Will the Fed Buy Stocks? (EP.473)

7:50Michael Batnick:What's Ben Stiller's?

7:53Ben Carlson:He's for the part of the Spanish only. No, what's his name? I can't remember. But so I guess my question is, what happens when this turns into an all-out brawl by the hyperscalers and they go and they turn on each other at what point does because it seems to me like if meta is going to release this low price version it was arturo mendez i never would have remembered that so if they all turn on each other eventually and it seems like so i don't know how meta releasing a new lower priced agentic coding model to me i don't know how that makes these any of these companies more profitable if they all just start undercutting each other and it's like wait we're spending all this cash flow and we're not going to be as profitable?

8:33Ben Carlson:Like when do these firms that have seemingly gone in hand in hand, when do they start turning on each other? Because this chart cannot continue. It just can't. A reasonable person would think this cannot continue.

8:47Michael Batnick:Yeah. I don't know. I don't know. But you're right. This is the chart of the earth for sure. Yeah. What to say? I don't know. I mean, I feel very unqualified to have an opinion on how long this can continue.

8:59Ben Carlson:I guess I'm trying to think of what are the second order effects of these companies do decide to turn on each other and say, all right, fine. Every man for himself now. That's it.

9:09Michael Batnick:Well, Apple is suing OpenAI. Microsoft, Satya Nadella has spoken out against the power that these companies are now yielding. Yielding or wielding? Wielding.

9:22Ben Carlson:Obviously, the simple answer is that these semiconductors, they've already started to fall. maybe in anticipation of this, that they'd be the ones that get hit the worst. Well, hyperscalers have already gotten hurt.

9:33Michael Batnick:This book has a chart showing the average absolute one day change in the, in the socks index. And the absolute just takes the negative numbers and flips it positive. So we're just looking at how much these stocks are moving. I did the sixth grade math. What's that? Yeah,

9:49Ben Carlson:I went to sixth grade math and what absolutes are.

9:51Michael Batnick:There's an audience bend. Okay. Um, Um, so 3.36 % has been the average daily change, the average, absolute daily change over the last 50 days. And you only see spikes like that. You saw that during the COVID crash, during the financial crisis and, uh, during the, the.com bubble unwind.

10:18Ben Carlson:So it's kind of crazy that I'm surprised that these numbers aren't closer to the.com with as much as these stocks have been moving, I'm surprised that the dot-com bubble still makes this current iteration look kind of tame.

10:31Michael Batnick:Yeah. Well, who knows how high this goes? I think they were down 5 % yesterday, looking up 5 % in pre-market. And a lot of this is a result of the leverage that we keep talking about. So Mike Zaccardi tweeted, the Goldman Sachs shared the momentum factor had one of the largest three-week sell-offs on record. Comparing it to the rest of the market was down, I guess 8 % or so of the last three weeks. Which is good. Those stocks can't go forever. Last week or two weeks. No, it was last week, right? When Samsung, yeah, we talked about this last week. And I said to Josh, stocks top on good news. Right.

11:11Ben Carlson:Good news. That's just not as good as people were expecting. So would be fair to say that this is like a top, right? right?

11:22Michael Batnick:Like maybe the semiconductors got ahead of themselves and are going to, but the question is like, is this the top?

11:28Ben Carlson:Right. Which is obviously hard to know. All right. Last week on the show, we talked about truck and Matt had a great piece on 10 reasons to be bullish. So I decided to write a follow-up piece called 10 reasons to be bearish. I'm guessing you didn't read it. So I'm going to go through the 10 and I want you to let me know what you think.

11:43Michael Batnick:Okay.

11:44Ben Carlson:Okay. And honestly, it was harder than I thought. So the first chart is a good one to the hyperscaler. So point one would be most of the hyperscaler CapEx is just circular. That's reason to be bearish. Two is the MAG-7 are underperforming. They can't keep underperforming.

11:59Michael Batnick:Hold on. I just have a question. You know what? Just keep going.

12:01Ben Carlson:Who cares? The MAG-7 are underperforming. If they keep underperforming like this, eventually that's going to impact their free cash flow usage, I'm guessing. Three, AI is bleeding into the economy. You guys had Michael Sembliss on TCAF last week. He talked about how the change in GDP is being more driven by AI and the spending on AI. So if we actually do see a slowdown in spending on AI, it's not just a stock market thing. It's bleeding into the economy. It could lead to an economic slowdown. Number four, retail is all in. We've been talking about a lot of these charts for Citadel Securities, leverage, all this stuff.

12:33Ben Carlson:Retail is in, right? Five, inflation still remains relatively high. It was 4.2%. It's still 3.5%, way above where people think should be reasonable, right? This is way higher than it was for much of the 2010s. Six, mortgage rates are still high. We're back to the highest mortgage rates of the year again. and we're closing in on 7 % yet again. I know this hasn't mattered yet, but people probably say housing is the economy. At what point does this start? Okay, seven, complacency. The S &P 500 was up 10 % for the first six months of the year. That was following gains of 18 % last year, 25 % the year before, 26 % in 2023.

13:11Ben Carlson:We could have a Minsky moment, stability breeds instability, okay? Eight, AI checks all the bubble boxes. We talked about this with Eric Thompson. It just does. Nine, we're due for a recession. We haven't had a real one in 17 years. It's been way too long since we've had a slowdown. And finally, 10, the returns have been too good. 24 % annualized since bottom of 2022. Huh? That was 10.

13:35Michael Batnick:No, but what did you say for number eight? I feel like you just talked about returns being too good.

13:38Ben Carlson:Number eight was complacency. That's part of returns being too good. Sorry. I mean, it's all part of the same pie. It is. So it's funny because I took both of these pieces and I put it to Claude and I said, here's 10 reasons to be bullish. Here's 10 reasons to be bearish. What do you think? What's the better argument? And Claude said the bearish arguments are way flimsier because the bullish reasons are happening now. The bearish reasons are things that could happen, but they're not happening. So it was like, actually, the bullish argument makes way more sense. Yeah, I buy that. You'll notice I didn't, I mean, I don't know what else I missed, but I didn't include valuations, right?

14:15Ben Carlson:Deutsche Bank has this thing on, And the CAPE ratio, I couldn't bring myself to do this.

14:18Michael Batnick:Yeah, I'm surprised at you that you didn't include that.

14:20Ben Carlson:Because the valuations, the valuations that matter, not the CAPE ratio, the valuations that actually matter, have been improving for forward earnings. Right? You've talked about, this is your one reason we're not in a bubble. Bloomberg had a chart that shows NVIDIA's valuation is the cheapest since early 2019 on a PE ratio, which is kind of nuts to think about. the valuation just keeps falling as this becomes, I guess, we supercharged the cycle for NVIDIA, and it got so big so fast that it's now turning into...

14:52Michael Batnick:I wonder if... I'm very curious. Is the market wrong on this? Is there an opportunity on the long side of NVIDIA here? Or is the market getting this absolutely right and saying, no, no, no, no. Peak NVIDIA happened in 2024. It's not going to continue to surprise the upside. We know it's printing gazillions in cash, but we doubt the sustainability of this. And we're going to put a lower premium. Like I think, I think the market is probably right.

15:18Ben Carlson:So per my thesis of everything getting pulled forward faster, again, NVIDIA was not in the top 10 for the S and P or the NASDAQ 100 as of 2020.

15:27Michael Batnick:Wow.

15:27Ben Carlson:So it, it, I think we, what if we pulled forward a cycle of NVIDIA that took Apple 15 years to live through and NVIDIA, I don't remember Apple had the cheap period now. Maybe that is what's happening.

15:39Michael Batnick:Can I blow your face off for a sec? Do it. You spoke about retail being all in? Yep. Have you taken a look at, so we have a DGEN DAO index or it's a fake index. It's like the meme ETF. Right. Looks terrible. Oh, rolling over? It looks terrible. So look at this chart from Vanda Research via Kevin Gordon via the daily chart book. How's that? A threefer. Retail investors, net single stock buying has fallen to a new post-COVID low. We're looking at the one-week rolling net retail buying of single stocks.

16:17Ben Carlson:Do you think that's partly because you can buy single stocks in ETFs now? That's what I was going to say.

16:24Michael Batnick:It's still somewhat surprising. But it's still, it's not, it's still, like, I don't think every single person that's buying this is now buying the levered ETFs. I still think this is an interesting data point.

16:36Ben Carlson:so here's another one on the why i didn't include valuations in my thesis i'm being bearish this is from duality research they have the forward p.e ratio for the tech stocks and it's down it's below the 10-year average it's well below the five-year average and it's been falling and it's basically near the lowest levels it's been since the start of 2025 so tech stock valuations are improving during what many think is a technology bubble. That's surprising. They can say, well, NVIDIA is a lot of that. But I don't think that the valuation thing that the market is obviously overvalued is such a slam dunk like people think it is.

17:13Michael Batnick:No, I don't think so either.

17:15Ben Carlson:That's why I didn't. What else did I miss on my bearish reasons? Is there anything else that I missed? Reasons to be bearish.

17:24Michael Batnick:uh i don't think you said the ai white collar potential recession yeah okay well we're going to talk about that later how that that one is way down my list of worries because it's not happening yeah all right this is not a bubble the only thing that you could say is in a bubble that i think is is potentially credible to at least argue is the memory stuff

17:50Ben Carlson:Well, it's the CapEx. You'd say that the bubble is the spending by these hyperscalers. You'd say that is the bubble. Fine, correct.

17:56Michael Batnick:Because it's not in the prices of the stocks. Again, memory, micron aside, maybe. And I don't know that micron's a bubble. Who am I to say? But Oracle is down almost 60 % still. That's pretty nuts.

18:10Ben Carlson:Microsoft is down 35%. Wait, can Netflix come back in and buy Paramount now? Since Oracle's down 60 %? Can David Ellison still afford it? but that's piggy bank.

18:20Michael Batnick:That deal's not done. Did you watch the fight, by the way?

18:23Ben Carlson:What fight?

18:24Michael Batnick:Conor McGregor. Oh,

18:26Ben Carlson:no, I don't really watch UFC anymore. Okay. Not for, I just, it's been a while since I watched UFC.

18:32Michael Batnick:Um, well, didn't it last 10 seconds? Uh, it did. Yeah, it was fast. Um, all right. Aside from technology stocks, there's a lot to be optimistic about in the stock market. I'm talking about the stock market right now. Alfonso De Pablos tweeted. Great name. Yeah, it really is. The S &P 500 X technology index closed the week at a new all-time high. I didn't even know that this existed. The thicker is SPXT. Here's another one from him. His handle is, he's got great charts. It's at alpha charts, A-L-F charts. The advanced decline lines for the S &P 500, 400, and 600 have all pushed to fresh all-time highs.

19:20Michael Batnick:And this is with what percent of the technology index is in a bear market? I don't have that number. Is it 20 % or 50 %?

19:28Ben Carlson:Josh and I were just talking about this last week. I can't quite remember. Equal weight, also at all-time highs, RSP. Yeah. Breaking, if I'm a, do my, what are you looking for the base and the uptrend?

19:40Michael Batnick:The longer in base, higher in space. All right, here's another one. So let's speak about where the bubble is. If it's in the memory names, then it's in their earnings per share, right? Because Micron's earnings went from$9 in January, 2025 to$135 today.

19:59A 15X, something like that.

20:02Michael Batnick:Huge number. So Chartkin Matt showed the S &P 500. So oftentimes when analysts are talking about earnings, you're talking about forward estimates. Okay? So when you're looking at like, when all these analysts are posting charts, it's always the estimated EPS over the next 12 months. So the question is -

20:25Ben Carlson:Who cares about what already happened?

20:27Michael Batnick:So the question is, all right, well, are these estimates any good? Like, are they just completely - How accurate are they? Should we take them to the bank?

20:37Ben Carlson:The other thing is like these earnings are not a mirage. They're happening, but can they last? That's like, that's the idea.

20:46Michael Batnick:So the answer is yes, they are quite accurate. 67 % of the time, actual earnings are within 5 % of estimates.

21:00Michael Batnick:furthermore the only time that you see a the uh this uh these lines divert is in any meaningful way is when recessions happen and when recessions happen the gap is

21:14Ben Carlson:very large this is this is a very good chart so yeah you're right so if you want to say that earnings are way overdone you basically have to if you really want to be bearish you have to say okay we're going to have a recession that's going to do it that's what everyone is wrong because we're going to have a recession and that's going to cause earnings to crash based on this data. It's also funny. Matt said that he showed me this chart yesterday and he said, it's interesting that the E is easy to estimate, not easy, but analysts are pretty good at estimating the E outside of recessions, right? Take recessions off the table.

21:42Ben Carlson:No analysts are good at predicting recession. They're good outside of it, but no one can predict the PE. That's what's interesting. Like the earnings, it's kind of forecastable most of the time, but no one knows what people are going to be willing to pay for those earnings. But look at how high those forward earnings are going on this chart. This goes back to 1995. We've not seen something like this outside of the jump after COVID.

22:13Michael Batnick:Well, also, I don't know if that's sure or not. We did a log chart.

22:17Ben Carlson:Yeah, fair.

22:18Michael Batnick:Because right now, you're right. Looking at this, it looks scary. Right.

22:24Ben Carlson:But again, if you really want to be bearish, I think you're banking on a recession. That's what you have to bank on right now. If you really want things to be really bearish and this to get kind of ugly, even a mild recession, that's what you need. So the trillion dollar question is, recessions are caused by something.

22:39Michael Batnick:They don't just happen.

22:42Ben Carlson:Yeah, but there's a perfect reason for a recession to happen, though. AI, I think a slowdown on AI spending can absolutely cause a minor recession. Yeah. So it's a legitimate, I think it's a legitimate fear. It depends how far. So that's it.

22:57Michael Batnick:We're all waiting for that to happen. Feels like.

22:59Ben Carlson:Yeah. How long are we waiting for? How long are we going to wait for it though? Probably a while. I mean, they haven't, the hyperscalers, if they really want to take this to the next level, they haven't really even started borrowing that much money yet. I know they're just dipping their toe in the water to borrowing money. They still have so much capacity to borrow if they want to keep putting their foot on the gas pedal. Correct? Yeah.

23:22Michael Batnick:If they want to. There's so many other areas of the market that look so good, like we just discussed. It makes me optimistic.

23:27Ben Carlson:Speaking of, small caps. Last week we talked about, we couldn't figure out why small caps are doing so well. Sonu from the Carson Group and Facts and Feelings podcast has our back. Why is it? Drum roll, please. AI. Even small caps are kind of an AI trade. Really? Which is surprising, right? I didn't really know that either. Okay. he broke these down into, because tech makes up a much smaller percentage of the Russell 2000. It's like 18%. Industrials is the next biggest one at 17. He's saying a lot of the industrials are also AI. So he said 24 % of the Russell 2000 index is tied to AI in some form.

24:10Ben Carlson:52 % of the total first half return comes from companies tied to AI. So it's not everything, but it's a big part of it. So he's saying it's basically industrials and tech stocks. And it's a lot of AI exposed stock. Like they're somehow exposed to the AI trade.

24:26Michael Batnick:Yes, but the other half is not AI. And that's, you know, the index is up quite a lot. Right.

24:33Ben Carlson:But that's, yeah. So anyway.

24:36Michael Batnick:Good line from, so Jason Zweig, one of the greatest financial writers of all time, wrote a simple sentence, but a good one. Investors keep chasing performance, but they never seem to catch it. Yes.

24:53Ben Carlson:So we've been talking about the fact that I think investors are becoming much better behaved. That doesn't mean to say that all poor investor behavior has been rooted out of the system, obviously. So Jason looked at a bunch of different funds and asset classes and basically showed that the behavior gap is still real. right the the performance of the fund versus the performance of the investors in the fund there's still a gap there he he used some work from uh jeffrey patak who we've we've highlighted before and he talked about how so bitcoin was trading at 46 000 when all the etfs were launched it's now what is it around 60 ish so you'd think people in those funds did okay but in aggregate people who started out in the Bitcoin funds lost an average of 5.8 % annually, jumping in and out of these funds.

25:46Ben Carlson:So the people who started out in those Bitcoin funds when they were launched in January of 2024. On a dollar-weighted basis.

25:52Michael Batnick:I don't, not to pick nits because directionally I definitely believe in it. I think it's right. This is like an extreme example to prove the point.

26:00Ben Carlson:Yes, it is. But I think the point still remains. The point remains. People chase the hot dot. I think that's still obviously a thing. Holy cow. Some people do it okay. Some people are momentum traders, and they've done okay trying to find the next thing. But a lot of people are finding the next thing after it already became a thing. And that is still happening.

26:26Michael Batnick:Ben, we got the opening bell. And IBM is down 23%. Your thoughts? I'm just kidding.

26:33Ben Carlson:1987 crash for IBM. Okay. I love that the stock market can still do that. How's that? I love that the stock market can still say, you know what? You're going to get punished bigly. You're going to just see you later, right? 20 % plus for a single day.

26:51Michael Batnick:Yeah, not for investors in IBM, but the general idea of the stock market is just, it's cold, Ben. It is cold.

26:59Ben Carlson:It's heartless. All right. Really good chart from Joe Weisenthal. He shared, they had a podcast last week and he shared a chart from that episode. He said, it's not just that U.S. household exposure to equities is at a record high, but that the stock market is significantly greater component of total household net worth than real estate now, which blows my mind. The stock market is the economy. So a lot of people look at this data and they go, this is reason to worry. Because almost every other time when stocks kind of peaked and took the lead, they crashed and these things are cyclical and I understand that sentiment.

27:33Ben Carlson:My takeaway from this is that this is the new normal. We're never going back to a period before where stocks aren't the biggest asset as a percentage of U.S. household net worth. And obviously this differs among different stratas of wealth. Obviously, this is aggregate. But I don't think we're ever going back to a point where in the early 1980s, stocks made up 10 % of aggregate household wealth. That's never happening. I could, I could, I mean, these lines will cross if there is a bear market. But think about how this, this happened to equities in the same decade that housing went on its best run ever.

28:14Ben Carlson:Yeah, I agree with you. Housing kept up a little bit. I think that if you fast forward.

28:18Michael Batnick:This is the new normal. I totally agree. Fast forward 20, fast forward 20 years and barring something entirely unforeseen, stocks will be above real estate for the majority of the next 20 years.

28:31Ben Carlson:Yes, unless we have like 10 % interest rates or something. But the thing is, so I'm fascinated by how people own stocks and how it can change. And Josh has written about this with a relentless bid. 401ks and IRAs absolutely changed this. And I wrote a whole chapter in risk and reward about the history of equity ownership in this country. So in the 1950s, it was like 4 % of people own stocks. By 1983, it was 19%. So people were way underinvested in equities before. Now, you would say, what about pensions? Pensions made up a bigger piece of it. But here's the thing. A pension really is like a bond.

29:04Ben Carlson:It's not like an equity. And the pensions back in the day, in like the 60s and 70s, they didn't really invest in stocks very much. They were heavily invested in fixed income. They were like rules that said you couldn't have more of than like 50 % or 30 % of your money in certain states invested in stocks in a pension. Like most of the pensions invested in bonds too. So this is the new normal. And the stock market is just more important than ever. and we're never going back to where that isn't the case. Okay? So Eric Belchunas, kind of on a similar note, he published this note in Bloomberg that basically said, is the stock market too big to fail?

29:40Ben Carlson:And he said, you know, 55 to 60 % of people own stocks and he gave all these rules or all these reasons why he thinks that the Fed could step in and buy stocks during the next downturn. And I think he's absolutely right. I think it could happen. It would not shock me. People would be so angry. Japan already has already done this.

29:57Michael Batnick:Japan did that for years.

29:58Ben Carlson:China has done this. So here's his six reasons why the stock market is so important that we would maybe step in and buy. And in a financial crisis, that would not shock me at all. People would be so angry. And I wouldn't surprise me if it happened. So he said the stock market is our retirement fund. Totally agree. We have the biggest stock market in the world. It's outsized, 60%, 65%. However, he says the Trump accounts are going to add a bunch of new investors. I don't think that's as big of a deal as he does. like all the new babies are going to get account. I will see. I think there's so many accounts out there.

30:29Ben Carlson:I think adding one more account is not really going to move the needle. We already have 401ks and IRAs and Roth IRAs and HSAs and 529s. Can I say something? So many accounts.

30:39Michael Batnick:Speaking of making people mad, that might make people really mad. Do it. I think that sending people checks during an economic downturn is the most effective way to fight a recession.

30:54Ben Carlson:now i don't know johnny maynard canes think that i know what happened last time it caused all of the shit that we're living through right now inflation destroyed the fabric of our society hugely unpopular obviously it was terrible the way that you described inflation there it sounds like it's like a bad guy in avengers worse but part of the reason why we got the inflation was

31:19Michael Batnick:not just the checks, it was that the supply chain was turned off. Right. And there was a huge imbalance of way too much demand and not a supply. Assuming that is not the case in the next recession, assuming things are functioning normally, I don't, I think that it, like obviously it will be inflationary to some degree. It's never gonna happen because the political impulse will be so dead.

31:41Ben Carlson:Yeah, Comrade Batnick, welcome to the socialist side of things, eh? I love it. Let's do it. All right. He also says rich people just own so many stocks. The top 10 % owns 87%. But wait, hold on, Comrade Batnick.

31:53Michael Batnick:This is a very important thing.

31:56Ben Carlson:I agree with you. If you want a slower recession, giving people money, you're right. It totally.

32:01Michael Batnick:But there is a huge school of thought that thinks that the economy, that recessions are healthy, that people just need to take their medicine. And things need to die. in order to be reborn. And I totally get it. I'm not saying that I disagree with that sentiment entirely. But I am saying, what if you could ease the pain a little bit and make people's lives a little bit less horrific?

32:34Ben Carlson:Especially for those who need it the most.

32:36Michael Batnick:Because the people that say that the economy needs to take its medicine are never the ones that are going to be collecting unemployment checks, whose lives are going to be turned upside down in a recession. it's think people, right? It's people, whatever, on Wall Street.

32:49Ben Carlson:People who will have the means to buy stocks when they don't. All right. So the question is, let's say the stock market is too big to fail. What is the second and third order effects here? And I don't know exactly what the risks are. Like we lap off the left tail. It's gone. The left tail of Great Depression, see you later. What does that mean? Now, here's my thesis of what this means. It means that markets will punish bad behavior way faster. And I think flash crashes now are not just going to be daily events. They're going to be bear markets. Like bear markets in the future are going to be flash crashes.

33:19Ben Carlson:We've already had them this decade, essentially. Look at IBM. Look at IBM today. IBM. Liberation Day was essentially a flash crash. Where the stock market, so this started in 2008. When they did not pass the TARP bill, and the stock market went down like 10 % in a day. And they essentially forced the politicians to come together and pass that bill. The stock market said, no, no, no. You're going to do this, or we're going to cause more pain.

33:41Michael Batnick:Yeah.

33:41Ben Carlson:The same thing happened in COVID, right? The stock market went down so fast and forced the hand, the government had to send out money. SVB. Liberation Day. They forced Trump's hand into saying, you know what, I think I'm going to do a 90-day pause on these tariffs. This is what's going to happen. The stock market is going to hold everyone's feet to the fire and say, if you don't do this, see you later. The market is going to be that. You're going to get way faster downturn. So the market makes people make decisions to do so.

34:09Michael Batnick:Yes, I agree. and it all works as long as earnings are going up. Because if corporate America slows, there's nothing politicians can do to make the stock market go up. That's true. It's just earnings growth. It really is.

34:28Ben Carlson:And guess what? Corporations are really good at producing earnings. Yeah. Especially when we have a 6 % deficit from the federal government. Yes. All right. The K-shaped economy narrative seems to be dying. Mike Sicardi. In June, higher income households after-tax wage growth eased, while that of lower income cohort improved to a similar level. So you had this thing for a while where, uh-oh, higher incomes are having faster wage growth. Now it's caught up. Maybe, just maybe, all of this stuff is cyclical, and it changes. And you can't make a narrative to everything about, like the K-shaped economy thing I think has been kind of, it was kind of a flash in the pan, just like lower income households doing so much better was a flash in the pan.

35:10Ben Carlson:These things change. I think the cake-shaped economy has been kind of debunked in a lot of ways. No. We talked about last week with the guy or a couple weeks ago with PNC, how lower-income households are spending more on their credit cards. All right, so, okay. So, to be clear. And the whole idea that the top 10 % are spending 50 % of the money, that number was debunked. It's not as bad as people think it is. It's a lot of the money. But it's always been that. I just think the cake-shaped economy stuff, we took it too far.

35:39Michael Batnick:Okay, so the economy is absolutely K-shaped. Always has been.

35:42Ben Carlson:Yes, it is and always will be.

35:44Michael Batnick:So I think you're saying just the narrative has gotten too far.

35:47Ben Carlson:We took it too far. It's the same as it's always been, essentially.

35:50Michael Batnick:Yeah.

35:50Ben Carlson:Thing is, if we really want to do a deeper dive on this, the biggest anomaly in US economic history of the past 100 years was the middle class being formed after World War II. We had a huge surging middle class. We built a bunch of homes. Everyone moved to the suburbs. That whole period in the 1950s and 1960s is never happening again. That was a one-time economic anomaly. And I don't think people have wrapped their heads around that yet. It was because of the aftermath of World War II. Yeah, good point. I've got all my yarn on the wall, like the guy in. All right. Something else that's wrong. For now, at least, the AI doomers are wrong.

36:31Ben Carlson:Well, if Sam Altman says it, sure. So far, at least, I'm pretty sure AI has been net job creating. This was not what I expected, although I was much less pessimistic than others, I thought by this level of capability, we'd have seen some impact. It's possible this direction keeps going. So I think you could say, as a fact.

36:47Michael Batnick:I think he's just doing some, I think finally the PR people got to him.

36:50Ben Carlson:Of course. And said, hey, asshole. But Dario from Anthropoc last year was saying, in six months, white collar employment, like they were making these drastic claims.

36:59Michael Batnick:And then people started throwing Molotov cocktails at their house.

37:03Ben Carlson:But yeah, but we're not seeing any of the predictions. So I think you could say that the models are now performing probably better than anyone would have assumed two to three years ago. Okay? Is it possible, I'm throwing a theory out, is it possible that people who sit in front of their desk and do computer coding their whole life don't understand how other white-collar work actually happens? Is it possible these guys made a wrong assumption about how this stuff actually works? And they don't really understand people. That's on, okay, this is from LinkedIn. Head of, chief economist at Indeed. U.S.

37:37Ben Carlson:software development job postings are up 15 % since the launch of Claude Code in late February 2025, while overall job postings fell by 7 % over the same period. And it's not a junior rebound. 71 % of the gains came from senior roles, 37 % from postings with AI in the titles. Okay? Software job postings are rising while we have the biggest software defeater ever that's been created that was made. This is what AI was best made for, is doing software role. And there's more jobs available for that. Look at the unemployment rate for ages 20 to 24 in the US. It had that little uptick from 2023 to 2025.

38:17And people go, see, this is it.

38:19Ben Carlson:It's essentially unchanged since the start of 2022 when ChatGPT was launched. Ages 20 to 2024, the biggest worries that people have. So all the AI doomers, Conor Sen. Wait, question, question, question. Are job postings the right metric here? Why would there still be software job postings?

38:43Michael Batnick:But isn't there a chart that shows the number of people, the number of software engineers has gone way, way, way down? Or am I thinking of a different chart?

38:54I don't know.

38:54Ben Carlson:I got another one for you. Conor San, if you look at the chart of year-over-year growth in professional and business service jobs, it looks more like pandemic overhiring bullwhip normalization than anything related to AI. So you had all this hiring, and then you had this decrease, and now it's coming back. He said, the thing I find interesting about these charts now is every month that passes, we get more powerful models, more token consumption, more familiarity with how to use these models, and yet white collar employment trends look better now than they did a year ago. The AI doomers are wrong.

39:24Ben Carlson:It would be so awesome. They are wrong.

39:26Michael Batnick:It would be so awesome if they proved to just be totally wrong.

39:32Ben Carlson:As of right now, they are. Now, everyone keeps saying, just wait. These models are going to get better. People are going to use them more. Companies haven't even started to invest in them. But that's true. That's true. But how long can we keep saying that?

39:43Michael Batnick:I don't know. I don't know if it's a year or two years. I don't know what the answer is.

39:47Ben Carlson:We know that corporations prize profits and efficiency over everything. If they could use these models to replace people, they would. If they can, they will. I just think it's surprising that we haven't seen all the AI people that are making predictions. Six months from now, just wait. Six months from now, just wait. Those predictions have not been coming true.

40:10Michael Batnick:Okay. True. All right. I've got some good news for you. All right. This segment is brought to you by PIMCO ETFs. They publish a market commentary piece called Ahead of the Curve. And right now, they say bonds are offering investors attractive opportunities right now. Now, they are a bond shop, but it doesn't mean it's not true. So they have a chart showing yields across most fixed income sectors are high versus recent history. Ben, we've spoken a million times about how Alley came to bonds in 2019. It was just, it wasn't easy.

40:41Ben Carlson:Part of the reason - For most of the 2010s through the early 2020s, bonds were offering paltry yield.

40:47Michael Batnick:People call them rewardless risk, right? That's how people refer to bonds. part of, and that's part of the, well, that's not true. I was about to say that's part of the reason why people flock to private credit. Part of the reason people flock to credit, it's well-trodden. We've spoken about this a million different times. Now, because yields have come down, overnight rates have come down, rates in private credit have come down, and because interest rates are going up, look at the taxable equivalent yield in high-yield munis. 9%. compared to private credit, also around 9%. What would you rather own?

41:29Michael Batnick:And I know it doesn't have to be an all or nothing decision. High-yield munis or private credit? Right.

41:36Ben Carlson:One in a more liquid wrapper, one of not in a liquid wrapper. So they compare rates in Q4 of 2021 to today. And so the range of rates today is probably somewhere in the 5 % to 8 % or 9 % range, depending on your level of credit quality and risk. And the funny thing is that I'm getting constant questions for Ask the Compound about, can I just own cash instead of bonds? People are still so traumatized from the bond bear market in the early 2020s that no one wants to own bonds anymore. Inflation is scaring me and cash has been a better place to park my money anyway because there's no interest rate risk.

42:14Ben Carlson:Can I just own cash instead of bonds? Well, you can. You can. There is a place, I think, for cash in a portfolio. you, I think people have learned in a rising rate environment with high inflation, cash is a really good hedge. But the yield curve, yes, the yield curve finally looks normal.

42:28Michael Batnick:You're actually getting paid. That's the thing. This is like a bond investor's nirvana might be too strong of a word,

42:35Ben Carlson:but people would have killed for these yields five years ago.

42:38Michael Batnick:Yeah.

42:39Ben Carlson:And you have, you just, people still worry about what if inflation and rates, you have a way bigger margin of safety in bonds than you've had for any time in the last 15 years. You know, that's so funny.

42:49Michael Batnick:You're 100 % right 80 20 was a six was it was a new 60 40 yeah for a while if you told investors in 2019 who were 80 20 what would your what would your uh asset allocation look like if you could get uh five percent on investment grade yeah five percent high quality bonds they would have said sign me up 50 50 yeah yes anyway um all right we got an email on this week's episode you discussed

43:14Ben Carlson:how firefighters and police officers i got a million emails about this oh did you go on a lot of people emailed about this.

43:19Michael Batnick:All right, so why don't you take the lead on this?

43:20Ben Carlson:You read this email and then I'll rebuttal.

43:23Michael Batnick:On this week's episode, you discussed how firefighters and police officers in San Francisco are struggling. Compared to tech workers, the average starting salary for a San Francisco firefighter is 100K. If they work 20 years, they get 95 % of their highest salary average, their highest average three-year salary. I have a family friend who is 58, retired from the fire department after 30 years and collects well over 200K in pension. Okay.

43:42Ben Carlson:A lot of people sent this to me. Someone even said like, hey, the median salary for a firefighter in San Francisco is$300 ,000. This obviously isn't true. According to the BLS, the median pay for firefighters is$59 ,000 per year. That was in 2024. In California, it's$83 ,000, and the top 10 % is like$140 ,000. Now, a lot of people say, listen, I've heard these stories of people getting overtime and firefighters. But what about in San Francisco? Yeah, I think it was like$100 ,000-something. Okay. But guess what? Good. Good for them. They're literally running into burning buildings. They should be paid a decent wage.

44:18Michael Batnick:What was the tenor of the emails? Like, what were the point that people were making to you?

44:22Ben Carlson:Well, I said, how do… I said, we should feel sorry for people like teachers and firefighters and police officers with having a higher cost of living in places like San Francisco. And what were the emails? No, firefighters make way more than you think. Okay. And they do make a decent… But guess what? They should make a good wage. They should get a good pension. they're putting out burning buildings for god's sake i just got a reminder in recent weeks about status symbols for rich people and why the whole idea of a status symbol will just never go away like personal finance people love to point out that like um true wealth is what you don't see right like the it's the stuff you don't spend money on which is obviously true if you want to build a big portfolio in a big bank account you're it's the lack of spending money it's very obvious but I have a guy I know who drives a very nice car.

45:09Michael Batnick:But why should true wealth be the goal? Well, that's fair.

45:14Ben Carlson:So my point is -

45:15Michael Batnick:No, seriously, like is the goal in life to hoard as much cash as you possibly can?

45:19Ben Carlson:Well, for certain personal finance people, it is, right?

45:23Michael Batnick:I know there's levels to that, right? Like the hoarding cash at a million dollars versus somebody with five or somebody at 10 with 20, you know, it's changing all the time.

45:34Ben Carlson:But if you say the person with$8 million is richer than the person with$6 million, you're not wrong. But if the person with$6 million has a really nice house and a fancy car and a boat, who's, who are people going to think is richer? The person with$6 million.

45:48Michael Batnick:Yeah. But I would say the person with$6 million is richer because they're living their rich life as Ramit says.

45:53Ben Carlson:Yes. That's the whole point is to use the money to enjoy yourself. But I got a good personal finance reminder of this recently. So I know a guy who drives a very, very nice car. convertible, like luxury, luxury. Um, and a friend told me, man, that guy is rolling in it, just rolling in it. Like, look at the car he drives. He's rolling in it. And I said, I can't argue with it. That's a great, he drives like a$250 ,000 car. Anyway, um, a couple weeks ago, I'm talking to the guy who drives a nice car. He's in, I'm the finance guy. So people talk to me about finance stuff. And he says, Hey, I got to get like a new roof on my house.

46:30Ben Carlson:It's going to be really expensive. It's going to cost like 50 grand. How should I pay for it? I'm a little light on cash these days. Can I borrow against my 401k to do it? I wanted to say sell your car. But anyway, this is just funny. That's one of those things where the status symbol will trump everything in the way that you perceive someone. There's a word for that person.

46:56Michael Batnick:And it's moron. That person's not rich. That person's a moron.

47:02Ben Carlson:Oh, yeah, but that's the hard part about understanding who actually is rich and who is just pretending to be rich. I'm sure that person has a very high income. Yeah, of course. You'd have to have a really nice car anyway. I thought it was just funny. Hey, you know what? As long as he's having fun. Okay. He's enjoying it.

47:24Michael Batnick:So Comcast is splitting up. Comcast is, you know, a lot of these media companies are basically like family businesses that are publicly traded. Obviously, Paramount was like the famous one, right? Some of the Redstone.

47:36Ben Carlson:I am so happy to have Comcast out of my life. I had them as my cable provider for years and years and years with their cable box. What did you switch to? YouTube TV. Oh, oh, oh. And I'm happy.

47:46Michael Batnick:Never looking, never going back. All right, we'll talk about this in a sec. I don't watch YouTube. Do you? Am I like the only person that doesn't watch YouTube? I don't mean YouTube TV. I just mean YouTube the service. Do I watch YouTube? I never scroll on YouTube.

47:58Ben Carlson:I know that's like the thing that... Oh, scrolling? No, I look videos up. I don't scroll. You're right. I don't use their... Their algorithm means nothing to me.

48:06Michael Batnick:Correct.

48:06Ben Carlson:I guess we're too old for that.

48:07Michael Batnick:Yeah. So anyway, I was reading about it and I learned... So Comcast is going to split the cable business and the broadband apart because the broadband is just... Whatever. One is an anchor on the other. Okay. All right? So I learned that they own Fandango. Did you know that? Didn't know that. I think the way that I discovered it was Rotten Tomatoes is owned by Fandango. I had no idea. So I said, is Fandango a good business? And Fandango was spun out. So Versant owns Fandango. Versant was spun out of Comcast. That owns CNBC and the Golf Channel? I don't know. It's weird. Oh, CNBC and MSNOW. Actually, CNBC and the Golf Channel kind of makes sense, actually.

48:49Michael Batnick:And MSNBC, which is now MSNOW. Anyway, Fandango, this is what Claude said. Fandango doesn't get broken out separately, but it's the biggest piece of Versin's platform segment. And that segment did$826 million in 2025, up 3.9%. The only Versin segment that grew year over year. And it's accelerating. Q1 2026 platforms revenue rose 9.5%, driven by Fandango movie ticketing. So anytime I go to the movies, which as you know, Ben, is... Pretty frequently. Pretty frequently. I go through Fandango. It's the easy pass of movies.

49:25Ben Carlson:okay i i don't think i ever really use it yeah i don't use fandango okay anyway uh people also but use them to buy like the video on demand and stuff right when movies come out early pay 25 bucks to buy a movie that just got out of the theaters or whatever so let correct last week

49:42Michael Batnick:we spoke about get in here my dog is doing that thing where the door is half open she keeps poking her head in an app and an app like she's gonna get hurt so last week we spoke about the fact that season two shows for netflix are crashing right and this guy anish munka had a good take not earth-shattering but it's obvious so people were saying that like part of the reason why these shows fail from season one to season two is because they're years apart. So obviously you lose the interest of the audience. But guess what? He said, look at HBO and the gaff theory falls apart. White Lotus grew its audience 63 % from season one to season two.

50:30Michael Batnick:And then another 57 % from season three. House of the Dragon only dropped 8 % between seasons. And House of the Dragon, I think the first, whatever. I think also that's years in between. Here's the reason why Netflix fails with season two. He says, the difference is the drop. Netflix gives you the whole season at once, and most people finish it in four to six days. After that, the show falls out of the conversation. HBO puts out one episode a week, so a season stays alive for weeks of theories, recaps, and arguments before the finale airs. By the time it returns, people have been talking about it the whole time.

51:04Michael Batnick:So, House of the Dragon, Cape Fear, two shows that I am watching on a weekly basis. Guess what I'm doing after the show? That's a really great theory. The other part of it is Netflix shows kind of stink. Well, there's that too. It's quality. There's that too. Because I'm watching The Agency, and I bet you that didn't have a gigantic drop-off from season one to season two. But HBO, Apple TV, I watch House of the Dragon, I watch Cape Fear, and I put on The Ringer, and I listen to the recaps. And with the binge method, it just doesn't... It's very ephemeral. It doesn't last. They might have to change.

51:41Michael Batnick:So they should experiment... with, I don't know, it seems like a radical change. All right, there was a long article.

51:50Ben Carlson:Also, House of the Dragon. It's just, I feel like they just pull these random characters that I've never heard of out of mid-air. Like, oh, this is the new bad guy and this is the new, like, they just bring people out and, like, I'm already confused enough.

52:01Michael Batnick:It's, yeah, but it's so good. So, episode four, like you, Ben. In this season, it's getting a little shaky to me. No, no, no, no, no, no. Hard to disagree. The first three episodes were 10 out of 10s.

52:12Ben Carlson:They were good. And then it kind of has fallen off a little because they're like, Like, hey, by the way, this is the bad guy now. I'm defending a show, which I would do. This random person. Episode four, yeah, it's cooled off a little bit, but there's only four episodes,

52:25Michael Batnick:and the first three were 10 out of 10. All right, but I agree with you. I have no idea what's going on. I still love the show.

52:30Ben Carlson:All right, I'm still watching. My recap of episode four,

52:35Michael Batnick:I don't know, Aegon got hurt. He saw his dragon, and who knows? You're not the bad guy anymore. You're the bad guy. Yeah, whatever. It's a great show. All right, there was a long article in The Atlantic, The End of Reading.

52:51Michael Batnick:So this is not a new story. Reading has been dying for a long time. A study analyzing 236 ,000 responses to the American Time Use survey found that the proportion of Americans who read for pleasure on any given day fell from 28 % in 2004 to 16 % in 2023. In 1975, about half of 20-something said they read the newspaper every day. today less than 10 % do. This is not a mystery. That was the only way to get information back in the day. Right. Books were the way that you learned anything. It was the way that you entertained yourself and similar with the newspaper. So I totally understand.

53:30Ben Carlson:There's nothing else to do.

53:31Michael Batnick:I totally understand the fears of, oh no, the medium is the message and the medium is bing, bing, bing, bing, bing, bing.

53:40Ben Carlson:The idea is people are probably reading stuff more than ever these days. It's just they're reading headlines and short snippets and social media.

53:47Michael Batnick:Well, so she said that in the article. But then she says, I think this is the key point. If TV crowded out the silent time necessary for reading, broadband, internet, and the smartphone make it nearly impossible. Not too long ago, at-home screen entertainment was finite. Shores aired on a certain day at a certain time. If you wanted to watch an old movie, you had to put your shoes on and go to a video store. Books could compete in that environment. Some people at least would turn off the TV and read a book before formal see. Wow, what a concept. Now entertainment is limitless. There's no hard stop.

54:15Michael Batnick:One show bleeds into the next. People watch TV with their phone in hand, monitoring social media, texting with friends. Netflix has reportedly told directors and screenwriters to assume that the audience isn't paying attention and to constantly remind viewers of what's going on. In this environment, people have to really be determined to read, and most aren't. So I understand the hysteria, especially like, oh my God, society is becoming so dumb. Nobody's reading books. Idiocracy is around the corner. and it's not entirely wrong, but books are just not an efficient way to digest information. Certainly not reading a book.

54:48Michael Batnick:So for example, last week we had a reader email me two book recommendations. One was a book about Jerry Weintraub, who I knew the name, but I wasn't really familiar with. It's called When I Stop Talking, You'll Know I'm Dead, Useful Stories from a persuasive band by Rich Cohen. So Jerry Weintraub was a producer. He started in music. He was Elvis's producer, manager, whatever. And then he worked with John Denver and Frank Sinatra in his later career. And then he produced Ocean's Eleven and that whole movie, that whole whatever saga. So had a very fascinating life. And I listened to the book. And he recommended that in the Portnoy book.

55:29Michael Batnick:Cancel me if you can. And I said, yeah, you know what? I actually haven't listened to an audio book in a month or so. I'll listen to the Wine Trout book. I'm not going to listen to the Portnum.

55:39Ben Carlson:The audiobooks go into a bear market during the summer, don't they?

55:41Michael Batnick:Yes. So I said, I'm not going to listen to the Portnum when I'll do the Wine Trout book. And guess what? I listened to the Wine Trout book in three days because it's so much easier. By the way, mild bone to pick with Spotify. What I love about listening to audiobooks with Audible is when you dial it up from 1 to 1.25 to 1.5 to 1.75, it tells you exactly how much time you have left in the book. It adjusts, right? So if a book is 15 hours and you're at 1.7, you know you're at nine hours or whatever the math is. And it motivates you to keep going. Spotify doesn't do that, which is kind of annoying.

56:18Michael Batnick:So anyway, I read, I listened to the Jerry Weintraub book and I enjoyed the shit out of it because I walked to Starbucks. That's 35 minutes a day, back and forth. I'm driving to the beach, whatever I'm doing. Like, you know, like you just, you fly through these books And then you said, hey, the Portnoy book is actually pretty interesting. So I said, hey, you know what? I'll fire that one up too. I already – so – and guess what? Finish with that book. Knock that one off. Reading sucks. It's hard. It takes a lot longer. And this is coming from – Ben and I love to read.

56:51Ben Carlson:Look at all these books behind me. I've literally read all these books. This is – so like a Franklin Roosevelt book? Are you kidding me?

57:00Michael Batnick:It's impossible. Yes. It's impossible.

57:02Ben Carlson:at our age to have time. I think you and I have both benefited from reading. Our careers were benefited because we read so many books. And I'm embarrassed to say, I probably finished less than five books in my entire college and below career of academics. And it wasn't until after college, I realized like, oh my gosh, I am so far behind. I need to read. And I read everything I could. The first two or three years I got out of school, I lived in an apartment by myself. My wife and I, we were dating at the time. We had a long-distance relationship. I read all the time. I still read a lot. I have a Kindle.

57:39Ben Carlson:I listen to books. But for most people, you're right. It's just not an efficient form of learning. However, having said that, a book, especially a nonfiction book, is typically like ideas and thoughts from someone that have been percolating for years and years and years. And they distill them down into one thing. that's why books are still such a great form of learning if you will put the time in to do it. Most people won't. Yeah, but it's, anyway, reading a book,

58:10Michael Batnick:too much for time to move in. I love listening to audiobooks.

58:12Ben Carlson:I can't believe it. Sorry, I still read fiction. I am the person who every single night reads for 20 minutes before I go to bed and it helps me sleep. I read for 20 minutes on my Kindle.

58:22Michael Batnick:Anyway, I guess my take is I don't think it's dire.

58:27Ben Carlson:I agree. People can now consume stuff on podcasts and on YouTube if they want to learn. And now LLMs, that will help them learn so much faster than it would be the whole book.

58:37Michael Batnick:There's better ways to learn. All right, real quick as we wrap up. Oh, what's Beach Club Wave been? Oh, that's me. I thought that was you. I was going to say, I don't know. You know what's funny? I thought that you were like, oh, there's like a wave of Beach Clubs. I don't know what this is. All right, I put that in here. so this has happened to me a couple of times this year and every time it's very embarrassing when you wave to somebody and they're not waving at you oh okay this is a good one so i get in my car lady pulls up next to me and i mean like five feet away from me and her car goes like this so i reciprocate i give her a wave and then she grabs her belt buckle and buckles her belt

59:25Ben Carlson:okay yeah how about this for waves i live in a in a neighborhood of probably 20 houses we lived there for 10 years am i supposed to wait when i drive and i drive by the same five or six cars every day where my house is of course you wave do you have to do i have to wave these people every day for the rest of my life because i feel like there's a couple of cars where we've decided like we're not going to wave at each other anymore like we've just we've both simultaneously made the decision like listen i see you you see me we're not going to wave each other every day Other people, they want the wave every single time.

59:54Ben Carlson:Every day I have to wave to these people? Every single day?

59:57Michael Batnick:I mean, it doesn't cost you anything. I'm a wave guy. Yeah, it's courtesy. I'm a courtesy. Okay.

1:00:02Ben Carlson:How about the Zoom? Here's something I've never done in my life, and I never will. I'm never going to wave after a Zoom. Bye. I can't do it.

1:00:10Michael Batnick:I mean, no, that's, come on, that's silly. Although Duncan is a big wave guy. So Duncan comes into the office, and he gives one of these. It's a quick, it's like a vibrating wave.

1:00:19Ben Carlson:Okay.

1:00:20Michael Batnick:I can see that. I like it. All right. Kevin Gordon tweeted, in this year's Gallup survey, 11 % of US adults currently take GLP-1. That's shocking. Too high or too low? And it's probably underreported. Right.

1:00:38Ben Carlson:So that number shocks you that that's high.

1:00:40Michael Batnick:It's so high.

1:00:41Ben Carlson:We need to crank it up.

1:00:42Michael Batnick:It's so high. So we've been talking about the impact on different companies, sells for Smucker's snack division, which includes Hostess. So they bought Hostess. Oh, I grew up on those Hostess cupcakes. The brown ones with a little squiggly on them. I had a Twinkie recently. You know, I'm a Yodels guy. I still love Yodels. I loved Hostess. I used to grow up on those. Anyway, nobody's buying Twinkies. This is the long and the short of it. US Snack Snails are down 4 % in the past four years. sales of sweet snacks generally have dropped 17%. How about that?

1:01:20Ben Carlson:That's surprising. I guess there are so many other snacks you can buy that are healthier. I guess it makes sense, but -

1:01:28Michael Batnick:So I think there was an article last week I missed about the crash in drinking. Did Derek write it or Derek Thompson or somebody else at the Atlantic? I can't remember who wrote it. People need to start drinking again.

1:01:41Ben Carlson:Yeah, we've been on this crusade.

1:01:43Michael Batnick:Yeah, I will not relent. I know some people don't like it. Speaking of drinking. I don't care. I will not relent.

1:01:48Ben Carlson:If you go to a concert, people are drinking. Okay, I have a quick story time. So when I was growing up in high school, Dave Matthews Band came out. They were huge. And when I was in high school and college, a lot of people loved going to Dave Matthews Band.

1:02:00Michael Batnick:You definitely hated Dave Matthews.

1:02:02Ben Carlson:No, no, no. I was a middle-of-the-road Dave Matthews person. I went to two Dave Matthews Band concerts in... I was not like a diehard. There was people who were diehard Dave Matthews Band fans. I had a friend who went to dozens and dozens of shows. and I want to be like, why do you keep going? He just loved Dave Matthews. So I went to two of them in college, and the only reason I went is because it was an excuse to go party with my friends. We went to like a cornfield in the middle of Indiana where they had a concert, and I still remember me and my friends shotgunning beers before the concert in a cornfield.

1:02:29Ben Carlson:Anyway, and it was a fun event just to go with like young people your age. It was all college kids at a time, okay? So this past week, there's a brand new amphitheater in downtown Grand Rapids. It's beautiful. It's like 12 ,000 people all outdoors. it they got like everything they've done right like it's it's a grab and go for your beers and you're like they they just did it right it's great so the first time i've been there it's a very nice venue and dave matthew's been playing and one of our friends said hey i'm a big dave matthew's band concert come with us we went with our one of our couple friends and here's what i was not expecting so i haven't been to a dave matthew's band concert since 2003 probably 2002 i couldn't believe the number of diehard fans there still are that are kind of like almost like deadheads in a lot of ways in it but it's people our age that have just grown up with them and continue to go to the shows in the intervening 20 years since they were such a huge act like they haven't had a good they haven't had a single in how long since there's a popular single 20 years probably you know and so i'd say 30 to 40 percent of the concert goers were these people who are diehards they have dave matthews band jerseys on and all the tour shirts and like they were vibing to every song and 75 percent of the songs were songs that I had never heard of before.

1:03:39Ben Carlson:So I'm expecting to go there and get the high school nostalgia tour.

1:03:43Michael Batnick:I want Ants Marching.

1:03:44Ben Carlson:I want Satellite. I want, you know, they did Ants Marching, which brought a smile to my face. But then I realized, so he had two shows in one week. Tuesday and Wednesday show or whatever. And he decided to play half the good songs one day, half the good songs the other day, on the assumption that all his Die Hard fans are going to go to both shows. Okay? So this concert was not for me. It was for the Die Hards. I was a little peeved that I didn't pay all the hits, but it wasn't for me. It just got me thinking, and I bring this back around to the economy. There are so many ways for people to spend their money on things they care about these days.

1:04:18Ben Carlson:And I'm not here to, like, judge these people either. These people were so, the Die Hard Dave Matthews Band fans were so happy, swaying, and maybe Gummies helped. But it just got me thinking, like, oh, these people have been going to, like, multiple concerts a year, like, for a long time. And it just got me thinking like, I don't know, 100 years ago, the ability to spend money on things you cared about just didn't really exist. It's a relatively new phenomenon.

1:04:43Michael Batnick:Like recreational spending.

1:04:45Ben Carlson:Yes, it really is kind of new. Yeah, what did you do 100 years ago? You went to the opera? Yeah, there was nothing like this for people to spend their money on. Anyway, interesting time capsule for me. It was like, oh, all the people I went to these shows without in college are now middle age and they're still doing it. anyway not my thing but

1:05:06Michael Batnick:I watched over the past couple of weeks I saw two watchable movies so if you see them on streaming they're watchable but skippable I would say How to Make a Killing is a pretty good plane movie is that a Glenn Powell one?

1:05:20Ben Carlson:yes he's had some stinkers actually surprisingly but people kind of give him a pass it's an airplane movie

1:05:28Michael Batnick:and The Mummy The Mummy was like The Exorcist It wasn't really a mummy movie. It was sort of like an exorcism movie.

1:05:33Ben Carlson:You can't do that. You can't reuse the name of another movie. Because I saw that. My son was like, oh, there's another mummy movie? He's like, no, this is a horror one. I don't like that.

1:05:41Michael Batnick:It was okay. It was totally watchable, but also quite skippable. So you're welcome for your service, for my service. All right, I saw, I told you this, Ben. I saw the invite on Sunday night by myself. And you know I love to raw dog movies. And in this case, it hurt me because I really wish that I brought my wife. In fact, I might take her to go see it. Because it was a date movie. This is a date movie. It was made for people our age. It is a husband and wife movie. I pay$8.24, I don't know,$10 a month. Duncan told me about this. And you get a free movie once a month. So I support the arts. I like to go.

1:06:21Michael Batnick:I knew nothing about this movie. Like literally nothing. It was written by Rashida Jones and Will McCormick, and it stars...

1:06:29Ben Carlson:They have a good one called Celeste and Jessie Forever. It's also a marriage one from 10 years ago that I really like. It stars Seth Rogen and Olivia Wilde are in a marriage that has lost its spark, and they invite their neighbors over, Penelope Cruz and Edward Norton, for dinner.

1:06:50Michael Batnick:And that's all I'll say.

1:06:52Ben Carlson:is it a movie that takes place in one night the whole movie is one night yeah it was it was

1:06:58Michael Batnick:i think my favorite movie of the year i laughed so freaking hard i can't remember the last time i belly laughed to the point where like i couldn't stop laughing at a movie it's been a long long

1:07:12Ben Carlson:time it was premise is not something i would consider a michael movie that's interesting that you say it's your favorite movie of the year.

1:07:19Michael Batnick:Well, I don't want to give away any of the plot, but it was so good. I had such an awesome time, and it made me happy.

1:07:28Ben Carlson:All right. Good to hear. A bunch of people reached out to me and said, Ben, your son likes the alien universe, which is funny. I don't know why we got talking about this. We started talking about our favorite movies, and I'm not a perfect parent by any means, but I think I've done pretty well in this area. My oldest daughter, Libby, her favorite movie is League of Their Own. My youngest daughter, Kate, her favorite movie is Goonies. She wants to watch Goonies all the time. And George, I said, what's your favorite movie? He said, I can't pick, but my favorite movie is the Alien Universe. Right?

1:07:55Ben Carlson:All the aliens. So a bunch of people emailed and said, your son has to watch Alien Earth. It's a show on Hulu. And Noah Hawley did it. He's the guy who did a lot of the Fargo shows, I think. So we pulled Alien Earth on, and he binged like half the season in the weekend. It's probably too adult for him as a nine-year-old, but whatever. Who cares? He likes the aliens. it's a little trippy for me. It's a lot of like robot, human, human, robot, cyborg. And it's, but he loves it. Absolutely loves it. Is this first season or second? First season. It's kind of, it's a prequel to the Alien movie, I think in some ways.

1:08:32Ben Carlson:But there's flash forwards and flashbacks and he's all in. He absolutely loves it. So thank you for the recommendations of that. And finally, we moved on to Adam Sandler rom-coms for my daughter and I, watching our nightly rom-coms together. So we did Just Go With It this past weekend and 50 First Dates, which are kind of funny. And the reason why I should just go with it is because Dave Matthews, Dave Matthews is in the movie, married to Nicole Kidman.

1:08:56Michael Batnick:Oh, oh, is this the Brooklyn Decker one?

1:08:58Ben Carlson:Yes. I mean, it's pretty, it's funny because my daughter, after watching two Adam Sandler movies, and I think 50 First Dates probably has one of the best endings of any rom-com that there is. I love the ending of that movie.

1:09:08Michael Batnick:I love that movie. What happens at the end? I forget.

1:09:12Ben Carlson:They're on the ship.

1:09:13Michael Batnick:By the way, this movie is 15 years old or 20 years old,

1:09:15Ben Carlson:so no spoilers. And his dream is to go to Alaska to study the whales or the walruses or something. And at the very end, she still can't remember. She wakes up. She's on a boat in Alaska. And she looks at the table with her life. And they got married. And then he says, do you want to meet your daughter? And every day she wakes up and meets her daughter because she can't remember the next day. It's a great ending. But my daughter goes, are all Adam Sandler movies just the same? Because in both movies, he's kind of a womanizer who changes his ways. And he lies to women to get them to sleep with them and date him.

1:09:45Ben Carlson:and both movies take place in Hawaii. Both movies, he has like a sidekick. One of them, it's, what's the guy's name? Rob. The guy from Grandma's Boy? Yeah, well, those guys are in them. Nick Swartzen is in the one. The guy from SNL. Deuce Bigelow. Whatever his name is. Oh, Rob Schneider. Rob Schneider. Anyway, and they both take place in Hawaii and I'm like, yeah, he just likes to have fun in Hawaii with his friends, I guess. Anyway, we're on the same on the rom-coms. Next is McConaughey. So, that's all I got.

1:10:17Michael Batnick:I've never seen any of the McConaughey rom-coms.

1:10:19Ben Carlson:Yeah, they're forgettable as far as I'm concerned. Okay.

1:10:24Michael Batnick:All right, then.

1:10:26Ben Carlson:We did it. I'm going to log off and now go watch IBM's stock price chart the rest of the day.

1:10:30Michael Batnick:I promise I won't bring it up again ever on the—as long as this podcast goes.

1:10:35Ben Carlson:Also, now that we've buttoned up the polo, very nice.

1:10:38Michael Batnick:Looks good? Yeah. All right.

1:10:40Ben Carlson:Okay.

1:10:43Ben Carlson:AnimalSpirits at thecompondnews.com Personal emails, personal responses Sometimes Michael responds and I say, wait, I wanted to respond to that too And we both respond That's happened a few times

1:10:52Michael Batnick:I mean, I do 95 % of the responding, so you'll forgive me if I don't wait for you to respond That is not true If I don't respond to the inbox, it will just It will just pile up That's a fact

1:11:04Ben Carlson:80-20 95-5 Thank you for listening, thank you for watching Thanks to the production team for their help as always. See you next time.

1:11:38Michael Batnick:We're a choir, but yes, we have that too.

1:11:42Ben Carlson:Straightforward coverage you can literally understand.

1:11:45Michael Batnick:That's what you get when you have farmers. Bum, bum, bum, bum, bum, bum.

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