Stocks Have Surpassed Dot-Com Bubble Highs… And That’s BULLISH

0:29Hello, everyone. We've got a lot to discuss today. Before we get into today's show, we are at 16 ,335 subscribers on YouTube, and I need your help. I'm trying to get to 1 million subscribers. So what I need you to do is go hit that subscribe button right now, help us get there, and let's continue rolling with the good times on this show. Let's get into today's topics. The U.S. stock market's been one of the greatest wealth creation vehicles in human history. Anyone in the world with a brokerage account could simply purchase shares in the S &P 500, They could sit back and relax, and they watched their investment portfolio grow to the sky.

1:02The economic mobility provided to equity holders is really hard to comprehend. For example, the S &P 500, it's up more than 13x over the last 30 years. It's not bad for a set-it-and-forget-it strategy. But now we're getting data that explains just how dominant the U.S. stock market has become. Global Markets Investor writes that the U.S. stock market is now over twice the size of the entire U.S. economy. The U.S. stock market cap to GDP ratio hit a record 211%. The ratio has risen a whopping 45 percentage points over the last three months. By comparison, the 2000.com bubble peak was way lower at only 144%.

1:37A big reason for this growth is the tech sector. GMI explains that the S &P 500 tech sector price-to-sales ratio that just hit 10x. It's the highest ever. Even the 2000.com bubble peak, the ratio was only 7.8x. Adam Kobisi writes that the Nasdaq's market cap relative to the US M2 money supply is now up to a record 145%. This ratio has now officially surpassed the peak of the 2000 dot-com bubble. Since the 2022 bear market low, it's more than doubled. And in other words, the value of tech stocks has surged twice as fast as the growth in the money supply. By comparison, this ratio fell as low as 25 % during the 08 crisis.

2:17So the question becomes, should you be worried? should be worried about your investment portfolio. The bears will tell you everything's overvalued and a big crash is right around the corner. The technologists will tell you we're accelerating into an abundant future. Calm down. The truth is probably somewhere in between though. Some companies are significantly overvalued. Some are still undervalued. And most companies are probably valued right where they should be. The sector exposure that investors have is going to be very important moving forward. Areas where AI can be used to drive real innovation and higher revenue with lower costs, those are probably gonna do pretty well.

2:49common sense. Sectors that use global crypto adoption as a tailwind, they're probably going to do the same. But there are plenty of antiquated businesses that will be left behind and the market will punish them in the coming months and years. The challenge for investors today is to be nimble in a dynamic market that is trying to figure out what technology is real and which companies can actually capitalize on the opportunity in front of them. Artificial intelligence, Bitcoin, stable coins, machine learning, defense, space, genetics, rockets, drones, much, much more. Welcome to the innovation age.

3:20Volatility is the rule, and investors who can see through the windshield clearly are about to make a hell of a lot of money. Ladies and gentlemen, there's a national crisis going on over corporate lunch. Let me explain what's going on here. So everyone's had the same experience. You're hungry at work and you want to eat lunch. You go down and you go find somewhere like Cava, Chipotle, or Sweetgreen. What they do is they give you a bunch of options. They throw it all in a bowl. They mix it up. They hand it to you at the end of the line. you go back and you eat at your desk, right? But now there is a major, major problem at these companies.

3:51Sweetgreen is down 70 % year to date. Kava is down 36 % and Chipotle is down 30 % as well. The problem is that these companies can't figure out how to sell enough food at a big enough profit to get investors excited. So why is that happening? Well, our friends over at Litquidity, known for great memes and great analysis, they say that it is not sustainable for consumers to regularly be spending$17 for a bowl. At some point, they're going to go back to making their own meals. But I actually don't think liquidity takes it far enough. The bowls, the menu price is$17. But you want meat with that? That's going to be an extra$3.

4:25Oh, when you wanted guac, that'll be another$3. Chips, that'll be$4. You want a Coca-Cola? That's another$5. Then let's pay tax. And oh, by the way, we're going to ask you at the cash register for a 15 % to 25 % tip to actually go ahead and make your meal that was supposed to be$17. Now it's 40. Joke's on you, fellas. So the problem here is that that's obviously unsustainable for people to be leaving their office, spending$40 on lunch, and going back and getting the experience of eating at their desk. My guess is these companies are going to have to do some sort of innovation in order to actually make this more sustainable, make it more attractive for people who want to eat healthy, get something quick, but not break the bank doing so.

5:04Let's see what happens. Seeing these companies down 30 to 70%, It's a national crisis, the slop bowl wars. Someone's going to have to figure it out or they're all going to end up losing. All right, team, I've got a very special treat for us today. I have Amir Fisher who is joining us. Amir is only 15 years old. That's right, he's in high school. He's going to be a junior in high school this upcoming year. He's one of the most impressive 15-year-olds that I've ever met. He's very interested in investing, but he took it a step further. He's got a podcast called Generating Alpha. And on that podcast, this 15-year-old has interviewed Steve Cohen.

5:36Howard Marks, Paul Krugman, Jim Chanos, and legends of finance. He knows more billionaires than probably anyone else you know. He's 15 years old and he's very, very focused on trying to learn about investing and understand the finance industry, but he's got a very unique seat. He's sitting in high school and he's looking around at all the trends of his friends. So in this conversation, we're going to get into what's going on with Gen Z, what are the trends to pay attention to, what's he learned from these billionaires, and he's going to give us a little insight into how he thinks about investing.

6:04Here's my conversation with Amir Fisher. All right, Amir, there's a bunch of different things that we could talk through here, but you're a 15-year-old who's been interviewing tons of billionaires and very powerful people across finance. Let's talk about you as a 15-year-old. You are like dead smack in the Gen Z-ish kind of demographic. And I think one of the things that you and I have enjoyed talking about over the last couple of months is a lot of public companies don't know how to actually reach your demographic. They know that they want you as customers, but they're making mistakes when it comes to marketing or understanding this demographic.

6:36What are some of the things that you think these public companies should be doing? And maybe some of the things that you've talked about with many of these finance professionals. I first want to kind of say a stat that on average, teenagers spend 4.8 hours a day on social media. And a lot of these big public companies are on social media, but they're not in social. They're on social media because they see young people are there, but they're not marketing to young people. They're using these old marketing strategies. They're doing these very fancy graphics that are sophisticated that they think looks good to them, but doesn't look good to my generation.

7:06They all look exactly the same. You see these elegant graphics, everything looks exactly the same from company to company. And I think the companies that stand out are the ones that really understand what we as kind of a generation like. So whether that be influencers marketing to us, whether that be something called UGC content, where you pay creators to make content about your brand, but something that really gets our attention because constantly scrolling, scrolling, scrolling, scrolling. And a lot of these things just don't stick out. There's a lot of marketing that, like I said, there's a lot of marketing that these people do that they think looks good to them, but they don't understand what looks good to us.

7:42And I think really observing trends on social media and ultimately doing things that can bring our attention to the post at any given time is super, super important. But yeah. When you think about these companies right now, how much of it is they don't have the right people, as you described earlier, it's really important. Like they don't have young people working in the company who understands this demographic versus they do have young people, but maybe those young people aren't actually being given the budgets or the kind of autonomy to go and actually do this. You need to be able to let them go out and do whatever they want.

8:12You can't keep them within these very strict parameters, telling them to do this, this and this. Their bosses who are older than them telling them to do very process driven things. you need to let them go out and do what they think is right for the company. And that's ultimately how companies will grow. Companies will not grow from the top down. They need to grow from the bottom up from these young people telling their superiors what works for their generation, because we are going to be the consumers in 20 years time. My generation is going to be the people that are buying these companies and buying the products of these, buying the products of these companies in 20 years time.

8:43So I think the most important thing companies can do right now is understand what my generation wants. and ultimately listen to their employees that are around my age that are in their 20s and 30s. Really, really, really listen to them. Don't say you're listening to them, but actually listen to them and implement their suggestions. Let's talk about some of the Gen Z trends, right? You're pretty unique in that you're young. You really have spent a lot of time, I think, trying to understand finance. You've talked to tons of people. You've got a podcast where you've interviewed all kinds of amazing folks that most people who are watching or listening to this would love to have had conversations with.

9:18And so I think you understand what investors are looking for. You understand what companies are looking for. If you go and put yourself in your 15-year-old seat and say, okay, what are the trends that my peers are really into right now? Are there certain apps? Are there certain technologies? Are there certain music or movies? What are the things that you think are really important? If you had a couple of minutes to explain to an investor, pay attention to these trends because this is what the teenagers are actually doing right now. So obviously, these trends are very cyclical, but I just want to spend, I just want to say as a person, and I know my friends, and as someone in high school, I'm going to my junior year of high school, the apps people spend the most time on being specific is Instagram, Snapchat, and TikTok.

10:00Those are the apps we spend the most time on just for just just just to put it out there and for everyone to know. And I think it's very important to be kind of aware of trends, especially in clothing for our generation. So for example, I think our generation kind of started the Birkenstock thing a couple of years ago. I saw ultimately in middle school and I was in eighth grade and I saw a lot of people wearing Birkenstocks and things like that. If you are able to tap into and see what my generation is using and likes, I don't think there's a lot of broad, very trends that are, can be dragged out over 10 years.

10:31One trend that I do think is happening outside of kind of normal high schoolers is I think founders are getting younger and younger. I think because technology is making it way more accessible to build incredible things, that founders are getting younger and younger, and there's much less of a barrier to entry to build things. That being said, going back to my point, I think investors need to be very, very aware of what we're using, what we're wearing, what we're doing, and not by looking at stats on a chart, not by looking about what Bloomberg says about what we're doing, but actually going and observing what we're doing.

11:03For example, there was this company Celsius six months back. I saw this girl, I was doing a project in social studies class and I saw this girl holding a Celsius can. And then the next week I saw a lot of people holding a Celsius can. And I wrote a research report on it and sent it to a couple of hedge funds. And that went from$26 a share to$56 a share. The ability to know what our generation likes can be super transformative for any investor. And going back to my point, it's not about looking at numbers on a chart. It's about actually being around us and understanding what we're using. You can't distill everything down to data.

11:38You still need narratives and anecdotes to really understand. Well, what's interesting about this is, you know, you and I have talked about some of the different trends that you've seen over time, and I always find it fascinating, you know, Saratoga Water, Celsius. There's a couple of these that you've seen, and it was very anecdotal, right? You were able to, because of your position as a high schooler, kind of look around and see it. But you just mentioned that you wrote a report and you sent it to some hedge funds. Talk a little bit about what was in the report. How did you think about it? Was it just like, hey, there's this trend going on, I'm seeing more Celsius, or was it more analysis on the actual company itself and you taking a view in terms of what was gonna happen to the stock?

12:13It was both. The catalyst was kind of my generation drinking a lot of it, and I see a lot of people kind of enjoying it and people talking about it. But then I analyzed the company and the company was in an okay position, but my kind of thesis, how I invest. So I'm invested in the S and P and I also hold a little bit of Bitcoin. I owe 10 % of my portfolio in Bitcoin. I recently actually bought 10 % of my portfolio in Bitcoin last week, but I invest 90 % of them in the S and P 500 and 10 % in a position. I really care about any given moment in time. And that's because I don't have the time to be able to pick.

12:49I think if you're my age going, you just can't go and pick 10 stocks or 20 stocks to holding your portfolio because due diligence, if you're doing it properly, due diligence takes one or two weeks. So my portfolio, 10 % at any given time is a company I really believe in. And that point it was Celsius. And so I kind of saw the trend going. And as long as the company's in a healthy financial position, as long as it's doing okay, and I see, and I really believe in the trend for my generation, I think it's in a company that's really great to invest in. And I think a lot of these investors overlook what we like, what my generation likes, and rather focus on the company itself.

13:24And I think these trends are ultimately way more important than how the company is doing at the moment in time, balance sheet related, income statement related, whatever it is. I think these trends are ultimately more important. And I was, yeah, in the research report, I was really focusing on how the company was doing financials. And then also the trend I saw, which you can't really put it into statistical terms. You can't put it. And I think that's hard for a lot of these investors to understand, especially when they're much older than you. if someone's saying, I see this trend, you can't really trust them.

13:52It's hard to. So I'm trying to kind of build up the reputation of being a trustworthy person and kind of a liaison to the investments industry of the trends that are going on in my generation. But yeah, I try to help where I can and try to kind of give my insights to people where I can. Let's talk about artificial intelligence. That's obviously a hot topic in public markets, and I think also in private markets, but you are part of a generation that people are like, oh, they're going to grow up with this stuff. They're going to use it every day. What are you seeing your friends doing with artificial intelligence, if anything at all?

14:26I think at this point, it's mostly used for school because obviously we aren't in the workforce right now, but to be blatantly honest, people just use it for school. So if they're getting an assignment that's really long and that's very kind of busy work, you don't need a lot of time to think about it. You don't need to be creative about it. People just do it on AI. I actually got in trouble in my Spanish class for using AI on a project. What did you do? Explain how people are using it. Use that example. Yeah. So it was a project I got. It was like 10 slides over two months. And you've got a story each day.

14:55You have to read it and you have to analyze it and write a summary in Spanish. So I just use it to do that. So it's very kind of simple things that I think schools are really scared of AI. And that's not, you shouldn't be scared of AI. You should kind of use it to teach these students how to utilize it and leverage it. Because ultimately, I want to explain a view I have for a second, is there will be a great bifurcation. AI is making you able to build things much more accessible. You can, like I said, you can build incredible things much easier at a much younger age. but also the advent of technology, technology getting, um, a lot of technology getting more and more advanced makes people lazier.

15:30You used to be able to, you have to have to hunt for your food. Now you have to go to supermarkets to get your food. And so there's gonna be like a tube going into your mouth to get your food. Um, so I think a lot of people are going to become lazier and lazier and let technology cater for them. And then there's also going to be a very small amount of people, smaller than we see today with like the wealth inequality that use technology to really get ahead, use AI to really get ahead and are kind of the people that control most of the wealth in the next 20 or 30 years. But going back to my point about school, it's really just used in busy work.

15:59And I think schools right now are teaching way too much kids how to think. I mean, teaching kids what to think and not necessarily how to think. I think the most important skill we can build up at this point in time and what these giants of industry, these titans of industry, what these billionaires think are the most important skills that us as a younger generation can build up is how to think, not what to think. They're teaching us too much what to think. We're teaching us too much to do these assignments, telling us what to think, but not kind of letting us explore our creativity, how to think, how to approach solving problems.

16:29And I think it's super important. I told a friend recently that it's hilarious to watch the same people who grew up on the Dewey Decimal system and railed against Google search, be the people who are telling the young kids don't use the AI stuff, right? Like they have this like nostalgia of like, well, how are you going to not find the information if you don't know how to look at an encyclopedia, or if you don't know how to use the Dewey decimal system, it's like, well, no guys, instead, they're going to use the new technology to do things faster and cheaper. And so, you know, calculators, how many times when I was in school, did a teacher say, you're not allowed to use your calculator.

17:05You have to learn how to do the mental math. And it was a good skill to learn for obvious reasons, but I use a calculator a lot more than I do mental math, right. And at any given day. And so I think that there's this balance between technology versus, you know, being able to do the skill. And, you know, maybe it's, hey, you want to understand what the technology is doing so that God forbid you need to fall back onto your own skill, but using the technology is where most of the value is going to accrue over time, right? A hundred percent. And I think making this kind of idea of AI kind of taboo and making it very scary to all these kids can ultimately be dangerous because if you kind of say, don't use AI, don't use AI and don't teach kids how to harness AI in the right way.

17:46Like some kids are doing all of their school using AI, like every single, even if it's creative work, even if it's something completely random, even if it's like takes five minutes of your time, they're just using AI, they're getting used to using AI for it. If you're not incorporating AI into kind of how we learn teaching us how to use AI responsibly, I think can be very dangerous. And I think it can make a lot of people kind of not learn how to think. I think it'd make a lot of people dumb to be like, to be blatant. AI is going to do a lot of things for a lot of people. And a lot of people are going to grow up thinking AI is going to do everything for them.

18:14And it's just not going to turn them into great people. What are the platforms that you or your friends are using? Are you guys just using ChatGPT? Are you using Perplexity? What are the actual products themselves? So personally, the two platforms I use most is Perplexity. I think Perplexity is just a better version of Google search because you have the ability to kind of compile all the information and it gives an answer. I think it's incredible. But the AI platform I most like right now is Gemini. The ability to be able to, like, I upload YouTube video links and it can analyze it for me. And because I'm on the whole Google ecosystem, I use Google Drive, I use Google Notes, I can tell to do stuff and it can access things across the ecosystem on the free plan.

18:55I think kind of the most used couple, if I had to name a few, is ChatGPT, Claude, and Microsoft Copilot. And then Gemini mixed in there. And perplexity, not a lot of people use it. I think a lot of these more advanced AI models, people are slowly, slowly getting a hang of and people are slowly starting to understand because there's so much, there's so many platforms out there for so many things. But most of us are using large language models. The big ones, OpenAI, Google, Anthropic. Yeah. Another trend I'm really interested in is what about like voice? So I use these AI models and I just talk to using voice mode and answers and I have a conversation back and forth with it.

19:34I find it very valuable. I noticed that my wife and her friends, they leave a lot of voice notes for each other. My kids have now gotten to the age where they can actually talk to the Alexa and get it to do things for them. It seems like the voice interface is only going to become more prevalent over time. Are you and your friends using a lot of voice or is it still pretty text heavy for most of these products? It's still pretty text heavy because I think the majority of the way we use AI is in school, like I said before. So like copying and pasting stuff into AI. I've been using voice more and more, and I think voice is incredible.

20:09But going back to kind of the point about using AI in education, I think it's extremely important for the teachers and for the administration to teach kids which AI to use for, which AIs to use for different kind of tasks. Because a lot of us only know the basic ones, the LLMs, the Chatsy BTs, the Geminis of the world, but there's so much out there that you can use to do so many incredible things. And honestly, we're not getting educated on that. You kind of have to figure it out by yourself, which I think is completely ineffective and honestly pretty dumb. There's so much great technology out there with AI getting bigger and bigger.

20:42And I think it's so important to teach people which AIs to use for what task, how you can use them, all these things. Yeah, it makes sense. And then help us understand, where do you learn in terms of books, podcasts, Twitter? What are the things that you're doing on a day-to-day basis? You're obviously very intelligent, but also very, I think, curious person. And being young gives you some advantages. You got a lot more free time than maybe somebody who's working 12 to 14 hours a day. So talk a little bit about your process of learning so much while you're young. Yeah. So I spend, I recently, first of all, I just want to kind of say a trend.

21:21I see less and less people my age reading books, physical books, and even online books. People don't really read books anymore. Sometimes I listen to podcasts, sometimes I scroll TikTok, sometimes I scroll Instagram. But I found that reading physical books, I used to read online books a lot, but I found reading physical books is extremely, extremely important. So kind of my process of learning is I don't try to sell myself to one thing. I don't try to learn only about finance because I think it's, like I said, it's ultimately very important to try to inform yourself on different perspectives. But a couple of podcasts I listen to within the world of finance, I think are very interesting, obviously my own.

21:53I don't listen to it, but I do it. but I listened to invest like the best by Patrick O'Shaughnessy. It's an incredible podcast. If you're kind of want to understand how these kinds of industry think Ted Seides has this podcast called capital allocators. And these are more kind of institutional podcasts, less driven for, I think it'd be very interesting for retail investors to listen to invest like the best in these podcasts, but most of their audiences, institutional investors and professional investors. I try to keep updated on the news from time to time, but I don't, I don't like to be super into what's going to happen with interest rates, all that kind of stuff.

22:28I'd rather just spend my time. I can worry about interest rates in 20, 30 years when I'm actually doing something that impacts that interest rates impacts, but I'd rather just kind of learn, read books. So it's ultimately boils down to YouTube videos, podcasts, reading books, and these clips from like clipped up podcasts on TikTok and clipped up podcasts on Instagram. I actually do a lot of learning from those things. I try to limit my time on social media to an hour a day, which I I usually do, which is good because it's much under the 4.8 hours a day on average by teenagers. But there's actually a lot of learning.