Why Gas Prices Can’t Wreck the Market

14:57Michael Batnick:Oh, so John, go down a little bit. So John, while you're looking for that. So it matters to certain industries. So for example, the consumer, we had retail sales yesterday. Relax, your chart is coming. We had retail sales yesterday and they were pretty good. United Airlines said the first piece of good news is that for now, at least, demand remains the strongest we've seen. The 10 biggest booked revenue weeks in our history have been the last 10 weeks. And also they said in terms of like where costs matter, where oil matters, the reality is, this is also from the United CEO, the reality is jet fuel prices have more than doubled in the last three weeks, if prices stayed at this level, it would mean an extra$11 billion in annual expenses for jet fuel.

15:38Michael Batnick:And for perspective, in United's best year ever, we made less than$5 billion. That's wild. So Delta said -

15:46Downtown Josh Brown:They have to pass that on. Delta said something similar. Five of their best days ever have come post the war. So the chart on the screen now is exactly the point Alex just made. On the left, that's consumer spending on energy goods as a share of total consumer spending. That chart only goes back to 2007, but makes the same point. It's been drifting down. And then on the right, when everyone inevitably says, yeah, but lower income brackets, what's that face? This is great. I love it. No, I'm, what did you bring on an amateur? So the chart on the right breaks it down by decile. And you can see that for every single income cohort, obviously lower income brackets bear more of this cost, but relative to 2012 in 22, which is the last date for which I have, I can assess data.

16:26Every single income bracket has spent less as a share of their basket on gas. So I was making a good face for listeners.

16:31Michael Batnick:I was making a great face because Dan aptly brought this thing where, because everybody says this hits the lowest income people the most. And yes, of course it does. However, this is instructive that in 2012, 14 % of their after tax income was spent on oil. And now it is down to what? Seven. It's a big move. I'll go with seven. Sure. That looks right to me. Maybe five and a half, six, something. Yeah. Even better.

16:56Downtown Josh Brown:And that's the lowest earner. And let's all be very honest about what's going on in the economy. The lowest earner almost doesn't even factor into S &P earnings. It's almost not even there. I have a difficult time talking about this because you don't want to be dismissive of people who are obviously having a hard time. No, I'm saying for the earnings picture only, I'm not saying it doesn't matter, matter. As investors, you have what matters for markets and that doesn't matter. So we're going to get to this point later, which is that we're trading shares of businesses and we're not trading shares of the economy.

17:24Downtown Josh Brown:And I think that that's writ large. It's obviously very painful to pull up at a gas station and the number has a seven handle on it. Like, and it's probably painful for like 90 % of people, but that's not the same as what is the S &P going to earn in Q2. I think also to your point, Josh, we always talk about how the big beautiful bill is going to be kind of a tailwind for the U.S. consumer, but all of that money that they're going to get back is probably going to be spent on higher gas prices. Yeah. So the average tax refund is a couple hundred bucks. It'll be boosted. Most people don't get tips.

17:57Most people don't get wages. But for people do, you're talking five or six hundred bucks. We can mechanically estimate how much more the average driver is going to spend on gas. And it's about five or six, seven hundred dollars. So they basically, so the boost that a lot of economists were predicting relative to the one big beautiful bill are now being eaten up. That's assuming gas prices stay elevated for the course of the year.

18:16Downtown Josh Brown:What a shame, Matt. It's like, oh, you got an$800 tax refund. But now everything is more expensive. And now you're going to spend$800 extra over the next, I don't know, three months filling your gas tanks for whatever SUVs you're driving. So it's a push. I bought shares in Delta. Delta has its own refinery. It's not a miracle that it's the better performing of the airlines. And it's not that you want them to make money on their hedge. because they bought a refinery, but it also doesn't suck. I mean, it's also the best airline. And if you believe, as you suggested at the beginning, that the market is telling you that they don't care anymore.

18:54So if you believe that oil is going to be lower, there's very few things, you know, I'm not recommending this by any way, shape or form. I'm just saying something that would be levered, obviously the lower oil prices quite dramatically would be airlines, cruise lines, those transport-type stocks.

19:08Downtown Josh Brown:If crude falls, those are the immediate impact as the airlines go back to their highs.

19:13Michael Batnick:I am a Delta snob.

19:14Downtown Josh Brown:What what did up? But what did Trump say last night specifically? He said, we're going to hit them hard over the next four weeks or something like that. I think investors really wanted to hear him talk about an offer him to this war. And it was the opposite of that. And we've also seen this pattern in the market since the war began where people are buying on Monday. We're seeing a rally on Monday. We're kind of trading sideways throughout the week. And then people are selling going into the weekend. I think they just don't want to be positioned for risk because, I mean, I've seen people on Twitter call this the weekend war.

19:41When the market is open, we're hearing the president say over and over again that he wants this war to end. He doesn't want investors to be selling stocks, especially in a midterm election year. But then we get a lot of the bad headlines over the weekend.

19:54Downtown Josh Brown:Down nine straight Thursdays. Yeah. And tomorrow. So if you're listening to this, we're releasing this Friday. The market's closed. And it's a three-day weekend, which opens up all sorts of possibilities. I will also say, getting back to your original point about the bombs falling. this is somewhat of a duh statement, but it bears repeating. The bombs falling are largely irrelevant. The straight passage is what matters. You went from 50 ships to now five or six ships. No, what will, right. What will be relevant is an expeditionary marine unit trying to take an island. That will. Yes, but I just mean, let's just say we signed a peace agreement tomorrow and we stopped bombing them.

20:33That's fine. And obviously preferable to people dying. However, However, if the strait remains, quote unquote, closed, then bombs falling or not is irrelevant. Or Trump saying that it's going to reopen naturally, I think, was the problem. Because if it's not the U.S. negotiating to reopen it, then who's going to do that?

20:48Downtown Josh Brown:Well, right. Well, he basically said if we cease military action, then the strait will just open. Yeah. And the Iranians have said, sure, just pay us a buck a barrel. I'm paraphrasing, but just pay us a buck a barrel, which nobody is going to want to do. They may have to do it, but nobody's going to want to do it. What does that mean? They pay us a buck? So Iran's going to tell everybody who wants to get a ship. And by the way, getting back to my original point, I forgot the most important part about oil prices. There are no ships there. You've got to get tankers into the strait to get the oil and then get them back out.

21:17That's going to take a little while also. But Iran's going to say, if you want to get a ship out of here, you've got to pay us a toll or a tax. Or we're going to launch one of our drones at your hull. And so someone's going to have to decide, the Emiratis, the Saudis, is it worth about a buck a barrel? per ship to pay the Iranians not to torch my ship.

21:39Michael Batnick:I want to ask you guys this. Alex, your colleague, John Authors, has a chart of the FTSE All World Index, and he highlights the question that everybody's asking. Is this it? Like, that's it? This would be the fifth largest drawdown this decade. It's nothing. So everybody's wondering, like, why are stocks not, where's the trapdoor? Like, we haven't had a down 2 % day. Are you kidding me? That's it. Which is incredible. It's bizarre. We haven't really had a VIX spike. I think I did 35 the other day. That's it.

22:09Downtown Josh Brown:He's making the point that the stock, the global stock market is underestimating the danger.

22:17Michael Batnick:Well, I think he's asking what we're all asking. Why aren't we down more? And I am a stock market truther. Like it dictates my mood and how I feel about the future. And what the stock market is telling me is that we will get past this. And all of the headwinds that are hitting the market today, higher interest rates, higher potential inflation, a higher dollar, all of that sort of stuff will subside and everybody will focus on earnings again. If you go to the next chart, I brought it for the S &P 500 going back to 2010 to contextualize the drop as well. So we got basically to 10%. You can see all the way there on the right.

22:52It's not usual, but it happens. But in the context of everything since 2000, it's not a very big drop. But let me ask you this.

23:00Michael Batnick:So the markets almost never underestimate risk, right? They do at key tops, obviously, by definition. And 06, yeah, we were whistling past the graveyard. But almost never do we like ho-hum risk. The VIX always spike, investors always dump stocks, and today they're just not. And so that makes me feel good because we are prone to overreact. And right now, maybe we're underreacting, but I view that as bullish, not bearish. Maybe I'm complacent. I don't know. It's very fitting, too, that it is the one-year anniversary since April 2nd, when Trump unleashed his tariffs. And we're up about 32 % since then, which is really incredible, given that we were on the cusp of a bear market.

23:38And it's really interesting to see that we are, you know, entering a war and we're not having much of a market reaction, especially before this war. We had everything going on with the private credit redemptions. At the start of the year, we had, you know, us capturing Venezuela's leader and Greenland and the markets just didn't react much at all.

23:55Downtown Josh Brown:Because I think the market has enough memory where the people that overreacted to the things that have taken place in the last three years, including Liberation Day a year ago, they looked so stupid so quickly that maybe it's a delayed reaction to this. I'll do you one better. And this has been a point of mine for a long time now. Forget the last three years. What about the last 20 years? Well, since the GFC, the debt ceiling, COVID, Ebola, forget COVID, I meant Ebola, the fiscal cliff, the Chinese devaluation, Brexit. We've had all of these headlines. Deep Seek. Deep Seek Monday. Silicon Valley Bank.

24:37All of these. Not that they don't cause short-term. Right.

24:40Downtown Josh Brown:He or she who reacts least recovers fastest. In all of these cases, however much longer later, we end up higher. And I think there is some, having seen what happened with Venezuela, where it was literally the weekend, I think a lot of investors are probably, well, what am I going to do here? We're going to be down 10%, but we're going to be right back up a minute later. And I would also add the market structure changes that we've all seen over the course of our career certainly plays into this.

25:04Michael Batnick:I'll do you two better. So midterm election years, going back to 1950, there's been like 20 of them, I think. The average max drawdown is 16%. I don't know why, but something always happens in midterm election years. What's an average max drawdown? So like the max drawdown in 1950 was 12%. The average in 1954, I mean the max drawdown in 1954 was 4%. So the average drawdown. The average of the max drawdowns. Yeah. Okay, fine. That's right. Was negative 16%. Oh, okay. I heard. And one year later, it's been positive 100 % of the time. Well, my one problem with that sort of analysis is one year later, the market is almost always high.

25:40Yeah. There's so many stats like that. 75%. Where if you take a long-term view, then the market is almost always higher. 75 % is a pretty good percent.

25:49Downtown Josh Brown:But I think the modern – We'll 7 % time. I think the modern asset manager – We've got a championship. The modern portfolio manager or asset manager is punished more for having overreacted negatively than they are punished for riding out a downturn. It helps that most of the downturns in stocks have been V-shaped. but like I think that's how you lose your clients. I don't care if you're a mutual fund manager or like whatever the wrapper is that you're managing money inside of, it almost doesn't matter. You will have a much harsher phone call with clients for having sold the bottom of a V and missed out on the recovery than you will calling people up and saying, we're in a 10 % drawdown.

26:41Downtown Josh Brown:It could be 20 or it could turn around tomorrow. We're just going to stick it out. You don't have as tough of a phone call or meeting or experience having to sit in front of a board or an investment committee. So I think that there's like an agency thing here where if that's the seat that you sit in, you have to decide buy or sell during a crisis. The easier call is I'm not going to I'm not going to panic. Yeah. And if you do, oh my God, you better be right. Because if nobody else sold, then you're going to look crazy. Yes. I think for your world, that's 100 % accurate. One of my least favorite times to be on TV is when I'm sitting next to someone who's in the process of describing how he positions his portfolios to be durable and long, et cetera, et cetera.

27:35And we don't overreact. But on the institutional side. I've been doing it for 27 years, but say more. By the way, I don't mean it in a dismissive way. I mean, that's what you're supposed to do.

27:44Downtown Josh Brown:Right. If I've got kids going to college and a retirement, where's that book? Just keep buying. You see, at Ritholtz Wealth Management, we celebrate durability. All right, go ahead. Risk is an opportunity. That's right. But on the institutional side of things. Did you know the Chinese have a character for crisis that also means opportunity? I feel like that was in an episode of West Wing or something. Did I just make that shit up? Why are you asking me? All right, go on. So Dan would say how he panic sales. Go on. Yeah, so tell us about all the panic sales that you make. Here's a tip for the viewer and listener at home.

28:13It's a tip. Hot tip. Hot tip. When you say something, it doesn't matter whether it's true or not. You better believe it. What Josh just did was waver, and you can't waver. That's true. But no, but on the institutional side of things, you get paid to avoid these types of downturns. Yes. And so the people I talk to, not that we're an advisor, but I was on the sales side for some time and still have people populated throughout. like there's a lot of uncertainty. I mean, people are, I don't know what the right word is, but shell-shocked from the volatility, not in the market, but in the headlines.

28:46It's one day we're leaving, then we're going to blow them to oblivion. And one day a ship gets through and that's great. And then the next thing you know, there's a fire. So there's just a lot of uncertainty that I would have thought, and we were saying before we came on, would have absolutely had the market lower.

29:03Michael Batnick:Are you feeling this day to day? because you're on TV all the time talking to people about this. Yeah, I mean, it's been pretty incredible to see kind of the lack of a reaction. I think it comes down to people having a confidence that President Trump does not want the stock market to go down. He is the stock market president. He views it as his report card. And as long as he keeps coming out and he indicates that he understands the implications on the economy, when investors get those headlines, then they don't want to sell. And I think ambiguity also, I think, is part of it. And until we get any kind of clear sign that the economy is going downhill or corporate earnings are going off a cliff, then people won't want to sell.

29:40We're not really getting that. Yeah. I do want to say, though, let's not get lost in the tyranny of the headline, so to speak here. And you guys know this. Beneath the headline, hundreds of stocks are down 10 % or 20 % or more. So while the headline index is not down that much, and some of the mag seven are doing some important work there in terms of being flat instead of being down, meta not being one of them. But a lot of stocks are really badly hurt in a lot of industries. So there are people out there who trade in individual stocks that are probably listening to this going, I don't know what these guys are talking about.

30:12Downtown Josh Brown:To build on that, the stocks that are hurt are the name brand stocks that people actually own. The stocks that are up are the ones that people don't even know that they exist. So you have a market that's being led by utilities.

30:24Michael Batnick:Industrials, great. Nobody heard of them.

30:25Downtown Josh Brown:Industrials, no one's ever heard of. Memory chip companies that, you know, do most of their business, build most of their product in South Korea. The name brand stocks that people know are in big, deep drawdowns, like the Microsofts, the Oracles. Meta. So the stocks that people care about are down a lot. To be fair, though, that was kind of anticipated going into this year. I feel like a lot of strategists were recommending that their clients move out of, you know, the Mag 7, the high flyers, and broaden their exposures.

30:54Michael Batnick:So we've gotten used to V-shaped recoveries. And I think often in hindsight, we look back on like, oh, it was a V-shaped bottom. Like April 9th last year was a V-shaped bottom. No, it wasn't. I mean, yes, if you zoom out, it was. Like today, it looks like it. But I thought I'd throw this tweet up from Mike Zaccardi. So as we saw a gap down this morning after a monster update yesterday, it's like, oh shit, we're going to roll over. And Mike says, April 9th captures all the fanfare 2025. But April 10th was a bruising session and the following week was no picnic. Bottoms are a MF-er. Like, they're generally not very pleasant.

31:26Michael Batnick:There's a lot of testing and retesting and anxiety. And, oh, shit, we're about to go over again. And maybe we're bottoming today, this week, next week. Maybe we're not. But they're not easy. In hindsight, they are. Everyone, on a long enough timeline, every bottom looks like a V. Sure. What I will tell you, trading through COVID, trading through Brexit, trading through the debt ceiling. What? Did someone? He does this thing where he points at Nicole as she shoots.

31:52Downtown Josh Brown:That was a no-look point. I noticed that. I was watching some previous episodes, and I noticed that you guys will be talking, and Michael will just do that. I should warn the— I was going to say, now we've— But you've been at long enough. But normally, when you point at a camera, you scowl because it's hip-hop. Can I show you? Excuse me? What do I mean by those scowl names? Let me show you. That's not a word. Like this. You ready? What Michael does— By the way, that's stunningly accurate. Correct. What Michael does is very off-putting. He goes like this. Off-putting. He smiled. Oh, boy. Forrest Gump wave.

32:28Downtown Josh Brown:All right. I don't know if you know, but that's how Mob Deep used to do it. Yeah. Nicole, you're disrupting. All right. Wait, wait. Where are we going? Are we doing this one? I want to see this one. This is good. This is good. This is good.

32:38Michael Batnick:All right. This is from Mark Ungerwitter. Yesterday, we had a rip roaring of a day. The S &P was up close to 3%. Momentum means we're up even stronger. And unfortunately, so we were below the 200-day moving average. and we all know this as market participants, unfortunately, these really big, strong days tend to happen below the 200-day moving average. As a matter of fact, 70, oh, there it is, 83%. 83 % of these up two and a half days happen in a bear market or in a below the 200-day.

33:08Downtown Josh Brown:A downtrend. Yeah. A lot of Wall Street trading desks yesterday were talking about how they viewed this as a short squeeze versus any kind of bigger change. Well, yesterday it was definitely a short squeeze. Well, stocks can't go down every day. Wait, why? Why was it a short squeeze yesterday? Because there was no actual change in sentiment around the war. It was just because we'd gotten washed out so much that people were buying. First of all, also, I can show you the baskets. All the short baskets were up 3%. Well, the short baskets, like SaaS software. Yeah, that's right. Goldman's most shorted basket.

33:42Most shorted healthcare. All those names. That was the stuff that was leading. And momentum. Small caps were doing well. Small caps did well. I saw somebody tweet yesterday. The unprofitable tech basket did very well.

33:53Michael Batnick:This was a good observation. He said, if your stock is up 10 % today, I'm sorry, it's going a lot lower. Yeah.

33:59Downtown Josh Brown:Oh, right. Because that's the pain trade just reversing itself temporarily. Yeah, for a minute. I did have one more thing on gasoline before we move on. This is from Neil Dutta. He says, I don't think it's that complicated when thinking about the economic outlook. Retail gasoline prices will continue to rise. Wholesale gas futures imply that pump prices likely advance to$4.30 per gallon. As I've noted before, gas prices are up 85 cents per gallon against last year. That works out to a$120 billion shock, which equates to 0.5 percentage points of disposable income. And let's put that chart up. Retail gas prices.

34:45Downtown Josh Brown:And, you know, I think that when we keep saying like the consumer's resilient, the consumer's resilient, almost like a mantra, like month after month, year after year. Well, we're going to hear from the financials. We're going to hear from the banks like very quickly. And that's maybe our first real read on whether or not they're seeing card spending pull back in one area because it's going up for gasoline purchases. And maybe that's not happening at all. but this is the thing that we've been waiting on every time they report. It's almost to the point now where the CFO, they jump out at the beginning of the call and say, let me just tell everybody the consumer's fine.

35:24It's like, well, it's like wheel of fortune where they just give you RSTL and E or whatever it is. Throw it out. Right. I, uh, I, this is probably too quick to be, to have any real macroeconomic effect. This is all, I mean, again, we're, this is weeks old. Uh, the, I always quote the Barclays had written a piece called, It's the persistence, not the peak. And so the length of time that you stay up here, I mentioned earlier about the mechanical way, and that's what Neil was doing. We can estimate how much of a hit this is. A lot of that's reliant on oil prices staying at four and a quarter or 435 for the course of the year.

35:56If you go up and you come back down, and this is why it's an oil price spike, not an oil price plateau. If you go up and you come back down, there'll be some short-term issues, but people will move on pretty quickly. So I doubt that anyone's going to say, and plus also remember the banks that have branded credit cards are now providing, since COVID, weekly data on credit card spending by industry, which is super helpful. So I don't think it will happen that quickly. But this gets back to, Alex said earlier, when he mentioned last night that this is going to go on for two to four more weeks, people didn't want to hear that.

36:28Because again, the longer this goes gone, the longer the trade is closed, the more you're going to work down those inventories, prices are going to start going up, et cetera, et cetera. I think while the market may not be showing it at a headline and indice level yet. The longer this goes on, the harder it's going to be to ignore. At the start of the war, he also said that this would be a fortified week conflict and we've already passed that. So I think when investors hear that he's talking about another several weeks, they know that it's probably going to be much longer than that.

36:55Downtown Josh Brown:All right. So the strategists haven't reacted yet. We're not seeing like across the board estimate cuts. Obviously, it's going the other way. We're not seeing price target cuts. We've seen a couple of them. Some have. But they've been very modest. They've been more like we're accounting for the losses that we've already experienced. One went up. Yeah. Barclays. Barclays. Barclays. Raised the spark, who's a great analyst, but he did take his target up. Yeah. We talked about that. We talked about that on what are your thoughts? Credit to him. I like when somebody, even if he's wrong, I just like that somebody is actually using their own.

37:27Downtown Josh Brown:Sticking their neck out. Okay. But retail investors are reacting to this. It really seems like a lot of the popular fun and games that the retail trader was playing the volumes are drying up yeah the flows are showing like the flows are in reverse now people want their money back and people seem to have had all the fun that they want to have for the moment even stuff like gold and silver which i know we don't associate with it's a retail trade but it totally was totally became palladium too um obviously crypto is cryptoing uh options volumes have dried up i think that's a really big part of the story is that and maybe that's not directly related to gas prices, but maybe it is.

38:10Downtown Josh Brown:People have to get the money to speculate from somewhere. And so if you do something, Neil's describing it as$120 billion shock. I don't know how much it's really costing, but if you do something that takes money from people's left pocket, then they have less money to do this other thing that they might've wanted to do. What do you think about that?

38:29Michael Batnick:Everything's a retail trade. John, chart 14. Grab this from the daily chart book, your colleague, Siddhartha, um, at Bloomberg, uh, investors poured$977 million into the pro shares ultra short Bloomberg crude oil ETF. The ticker is SCO. This is not, these are not hedge funds, Dan, is it? Ultra shorts? I doubt it. No, because they would drop through with futures. They use futures or swaps or whatever. These are the ultra short ETFs These are not good products. Okay. I highly doubt institutional guys are playing in any meaningful way. And these are daily trades. So that is one 95 % retail at least.

39:12I have a good chart for you that is kind of related to this. So I don't know if I can. Yes. This is the first person besides for me to pick up the computer. I do this all the time. The first time I was here, I brought paper. I had to come ready. I love this move.

39:24Downtown Josh Brown:John, retail single name buys at post COVID low. No, this is new. Vanda Research, look at this. So they keep talking about how the animal spirits that we've seen investors buying, like the single stock names that they love, Palantir, NVIDIA. We haven't seen that since October. So they're buying ETFs, but they're not buying single stocks.

39:43Michael Batnick:They're gone. So the animal spirits that we saw for so long are not here anymore. Well, I think that's a function of every pullback.

39:50Downtown Josh Brown:The retail stocks aren't doing well. This isn't right. We gave people lots of money and there's tons of anecdotal evidence of people sitting at home and - Oh, that dried up. Do you think that's still a thing? Yes, I do. No, that's what I'm saying. It was for a while. It was and now it's not. I'm saying now we are - people are - things are getting tightened up at the fiscal level. We're not giving out stimulus checks. That's all long gone. These guys will be back in two seconds. Okay. They'll come right back. Yes, but they need new stocks. Like Palantir is not Palantir anymore. You're right. Tesla is not Tesla.

40:24Downtown Josh Brown:So here's what's working, Josh. So like Corning, they're not buying Corning.

40:27Michael Batnick:They're not buying Sienna and all these boring names that are ripping. They're just not.

40:31Downtown Josh Brown:Yeah, they're not right. They're not interested in Constellation Energy. These are not there. The stocks that are going up in March are not retail stocks. Yeah. People don't even know that. Why not Sandisk? You know what? I don't even know what it is. You know what the best performing stock in March is? Akamai. Remember that name? Of course I do. It's a$16 billion market cap. You know how many retail traders are in this thing? 12. Like literally, like nobody, nobody is in the stocks that are going up right now. I don't know. There's a couple of, Dow, Dow is a top performer. Dow Chemical. Yeah.

41:04Downtown Josh Brown:That's got a big following on Robinhood.

41:05Michael Batnick:Very sexy name. So getting back to like, looking out the second half of the year, assuming that we're not having this conversation in August, because if we are, the market will be much lower, right? If the war is still going. Yeah, sure. Yeah, market will be much lower. So assuming that there is some sort of resolution to this eventually, and we think that earnings will hang in there, the CEO of Paychex said this week, what we're seeing is a stable macro environment. No signs of recession in any of our data or indicators. Nothing that would indicate that we would change what we're thinking in terms of pace on any of our segments at this point in time.

41:41Michael Batnick:They serve 750 ,000 small and mid-sized businesses in the United States. They know. And so absent like complete deterioration, yeah, the labor market's like soft-ish, but it's fine. Continuing claims are fine. Initial claims are fine. And S &P earnings, tech earnings, 15, 20%. Stocks should be higher in the second half of the year.

42:01Downtown Josh Brown:Yeah. Do you think the level of the stock market is a risk itself to the stock market or to the economy? Meaning we do have this huge wealth effect. We do have this K-shape. a lot of the gains that have happened in the economy have happened for equity shareholders really haven't had a sell-off that we haven't come back from quickly. But if we have a sell-off where we don't get back to a new high within a couple of months, does it sort of change the landscape for the way people are spending? I'm still waiting for that moment. I haven't seen it. I disagree. All of you, don't worry about it.

42:41Michael Batnick:It's the job market. Yes, it's the job market. By the way, just to color it in, we got earnings from a William Sonoma five below a couple of retailers who all said things look fine. Now, this was really before the war got going, but paychecks is not alone. The reason why I disagree with this with his assertion, clearly the wealth effect matters clearly for upper income brackets. He just announced he feels good or bad. The stock market's down. That's probably why he's wearing that sweater. That's all he could afford right now. That's right. So it certainly drives sentiment and spending. However, we all seem to memory hole 2022, when the stock market fell by a quarter, let's say 25%, 27%, over 10 months.

43:20And yes, it started, in retrospect, it looks like a V-shaped bottom, but it didn't shoot right back to the highs. A 10-month bear market down a quarter, down almost 30%. We obviously didn't have a recession through a company. We didn't have a recession. Why is that not? Oil went to$120. dollars. There was food issues because of wheat, et cetera, et cetera.

43:41Downtown Josh Brown:Oil ran up on the Russian invasion. What's your point? Right. We're talking about the wealth effect. You don't think the stock market wealth effect is as important. I'm saying it does matter. I'm just saying, to be intellectually honest, I have to look at 2022 and say stocks fell by a third, not a third, a quarter. And spending didn't. And the economy was not great, but it didn't go into a recession, even with a war that It impacted wheat prices, grain prices, et cetera, et cetera. And oil went to 120, et cetera, et cetera. So I do think the stock market matters. I do think it matters for upper income bracket spending.

44:11However, there is this data point that tells me maybe you're not 100 % right. Alex, what do you think? I will say now, though, that U.S. households now hold a record 45 % of their financial assets and equities. So I'm curious what that figure is back in 2022. I don't know if it was as significant.

44:29Downtown Josh Brown:Probably close, but lower. Probably close, but lower. It's more important than ever, would be the point that I would make. You mentioned the guy at CIBC. Chris Harvey, yeah. He said that equities are more important to the economy right now than gas prices. That how the stock market is doing is more important. And I think there's some validity to that. I sort of feel that way. But then a lot of people will say what Dan said, which is that we've had plenty of bear markets that didn't tip into recession. This is the saying that the stock market's predicted nine of the last five recessions.

45:01Michael Batnick:But both things can be true. those aren't necessarily contradictory things. Dan, I want to get your take on private credit with the headlines this morning that 41 % of one of Blue Owl's legacy funds got, you know, people want their money back, 22 % of the bigger one. As usual, the headlines don't tell all of the facts. I was actually shocked to see, so they sent a letter out to their shareholders. I was very surprised to see this. Okay. The 5 % tender offer represents$988 million, which together with gross capital inflows of approximately$872 million. Holy shit, that's a lot of money. I would have thought that would have been zero, honestly.

45:47Michael Batnick:$872 million in, 988 out, resulted in a modest net outflows of$116 million, less than 1 % of OCIC's NAV as of December 31st, 2025. And this is also very, very noteworthy, in my opinion. Notably, this activity was driven by a relatively small minority of the investor base, with approximately 90 % of our 90 ,000 shareholders electing not to tender. That's shocking. 90 % elected to stay put, and 1 % of shareholders representing the majority of tenders. So there's a lot to say on this topic. But the first is a lot of these headlines miss some of the nuances, and the inflow story is an important one.

46:32Every quarter, loans mature, get paid back. Every quarter, money comes in, and that offsets a lot of these outflows. Also, everybody's putting in a tent. I know what we just talked about. But in general, there's a lot of headlines out there. And if you own a non-tradable BDC, everyone's in your ear saying, put in, put in, put in. You're only going to get 5 % back. So there's some pressure there. in terms of a headline. But the other thing I would point out is, A, there's clearly problems in private credit, obviously. Money flew into the sector early in the 2020s. A lot of loans were made, particularly to software, for all the reasons.

47:11There's problems coming. Well, listen, sure.

47:14Downtown Josh Brown:There really aren't problems yet, but everyone knows that they're coming. Yes, and that's part of the redemption story. There are always more cockroaches, as Jamie Dimon. Sure. I think the part of what I've been pushing back on is the idea that this is somehow systemic and that there are a number of stories that get written, obviously for clickbait reasons mostly, but there are a number of stories that get written comparing this to two. This is the next stop prime. Give me a break. Come on. There's no deposit-taking institutions. Leverage is nowhere near it was. I brought a pair of charts, chart 38 on the difference between this.

47:4879. Here it is. Okay. The chart on the left is, this is commercial banks in the United States lending to what we call non-bank or non-depository financial institutions. That's called 14 -

48:00Downtown Josh Brown:Bank loans to regular companies that are not themselves banks. Yes. Now, it could be - That's private credit. Yes. But it is the headline number. It's not only, but it's good enough. But isn't there nuance here?

48:13Michael Batnick:Because wouldn't you rather JP Morgan be making loans directly to Blackstone as opposed to Blackstone's customers and then having knife fights with all these syndicated loans. But, but so there's, and this is the other thing is I don't think people get, not, I don't think clearly people don't get what's going on here. First of all, there's the leverage loan market. That's one and a half trillion in size. That's illiquid. Half those loans don't trade either. Those are your regular way loans. But, but by the way, just to finish the point, the chart on the right is residential real estate loans back in leading up to 2008.

48:44And that was like a third of loans. So let's just say twice as many loans as a share of bank loans in 2007 went to residential mortgages as did loans today going to private.

48:55Downtown Josh Brown:So real estate was a much bigger lending. Problem for the banking sector. Okay. Which obviously housing is the biggest part of someone's assets. You've also got more leverage. There's all sorts of – and the depository institution is the most important one. Apollo doesn't take deposits. But this is not to say there's no problems. There are plenty of problems. I'm just saying the likelihood that this is akin to 2008 is not nearly as dire. And that's sort of the point that Jim Zeltner and John Zito and those guys who are out there, the Owl Creek, not Owl Creek, I'm sorry, the Blue Owl guys are out there saying it's just not that.

49:28It's going to be something, but it's not that. But at the same time, a lot of loans are made to a lot of software companies. I mean, getting back to the broadly syndicated loan market, there's 1 ,200 loans in the broadly syndicated loan market. Nobody has heard of almost any one of them.

49:46Downtown Josh Brown:Yeah. 85 % of them are private companies. 90 % of them are private companies. They're just, you don't know. They're loans made in small amounts, a couple hundred million. There's all sorts of companies. No one had heard of First Brands. No one had heard of Tricolor. And they're not that big. relative to the rest of the portfolios of these companies, the risk is also very well shared. You often find the same loan in the books of seven or eight different private equity or private credit funds. And the final point I wanted to make about the lack of most people didn't redeem, the non-traded BDCs are a very institutional product because institutional people, I say guys, but institutional guys know the deal.

50:32You're not going to be able to get your money back in time. It became a wealth management product. I'm not. I was talking about retail. I'm saying that is a product that really was meant for people who have long time horizons. It was. And a lot of those people who are in it, a lot of the money are cool with that.

50:49Downtown Josh Brown:Yeah. But when you talk about$800 million coming in, that's money that's on autopilot at, at RIAs. They just say, nah, yes. They're not dollar cost average again. Those are conversations. I don't. so I don't think so. I think it's in the model. I talked, I talked to the people that run these gigantic firms. They all have private credit and private equity as a slice of the asset allocation. And so let's say they have 500 financial advisors, those 500 financial advisors on board. I'm just making up numbers, a billion dollars worth of assets over the last quarter. If they say 7 % of our allocation is going into this alt's sleeve, that money's just going in almost like a 401k.

51:34Downtown Josh Brown:You have small cap, mid cap, large cap. That's how they're treating it. I don't think that they're negotiating each time with a different client. Should we buy this or should we not?

51:45Michael Batnick:You're 100 % right. But I do think that in the second quarter, it's not going to be$800 million in because there's no way that those advisors are saying, well, the headline risk is too high now. Guys, I don't really, this is not fun anymore. Can we just like pause maybe for a minute?

51:55Downtown Josh Brown:You know what the most obvious trade on earth is that I will not make myself? If you think that this is a panic and a freak out. It's totally unwarranted based on the actual fundamentals. Just buy the publicly traded BDC.

52:09Michael Batnick:Yeah, buy OBDC. This thing's trading at a 25 % discount.

52:11Downtown Josh Brown:So you can buy it at a... So if you want to go lean the other way... What's NAV? Don't buy... But I'm saying, don't buy the private one. What are you, an idiot? Correct. Well, there are people who prefer the illiquidity of the... I mean, there's a reason why a non-tradable one exists. So an idiot. In other words, this thing has a ticker symbol. You have to live through it doing this every day, okay? This one has no ticker symbol. You never have to see the price. However, you can only get 5 % of your money out at a time and it's gonna be a really long time before you can get all of it. Oh, by the way, the public one, selling at a 25 % discount to NAV.

52:47Downtown Josh Brown:The private one, they're still marking it up like it's 1999. It is crazy. Why would you put your money into a private one now?

52:55Michael Batnick:I don't get it. But no advisor will say, hey, we're gonna get our money out of the private one and let's go headlong into the fire of the publicly created one. But that's the choice. Isn't that the choice? You're right, but nobody does it in real life. But you're right. So the big question is this. Ultimately, what happens to the loans? Because Howard Marks has famously said, the worst loans happen in the best of times. And there's no doubt that there's way too much money coming in. And the underwriting standards probably loosened up more than a little. So OCIC, Blue Owls Fund that we're talking about.

53:23370 companies,$36 billion.

53:25Michael Batnick:That's what, according to them, that's what it's worth. 31 industries with a 0.3 % weighted average position size. These investments are an average EBITDA of$297 million, 93 % senior secured loans, 40 % loan to value, and 91 % backed by private equity sponsors. So I don't know how much time these companies are going to need to prove to investors that the defaults are modest, that the distress is like calm before the headlines, before the ad flows subside, but it's not going to happen overnight. I can keep talking, but please do. I'm not a private credit expert. And the software, the software is the problem.

54:03It's 25 % of some of these portfolios. Throw up chart 98, the one with the, uh, the share that's in the software, just so we have it in the background. Uh, I think you said the important part of the conversation here, which is that these are senior secured. Now for equity people who don't know what this means, it means when you buy an equity, they could go to zero. When I 17, John, here we go. Thank you. Not 98. That's your share of software exposure by BDC. these are the publicly traded BDCs?

54:30Downtown Josh Brown:And this is how much software is in each of these products. Now, mind you, I have to double check my numbers, but is healthcare, I mean, some healthcare technology could be software. There's some nuance to this, but in general, the numbers call it 25 % on average. A lot. A lot about software made it very comfortable for these guys to lend to them. But the point about senior secured, I own you. And for me, loaner, To lose money, lots of stuff have to go wrong. The equity has got to get wiped out. That's got to go to zero before that happens. All sorts of stuff that's subordinate to me.

55:06Michael Batnick:So this is the hilarious part. We're spending so much time on the credit. What about the freaking equity? Are you kidding me? This is the famous line that guys have stumbled on, which is if you think private credit's in trouble, wait till I show you private equity. Now, mind you, I'm not saying either are in trouble. I'm just saying people are talking about on CNBC and in the newspaper are talking about a lot of these loans like they're equities. Like why are they still marked at 90? A distressed loan might be 85. Well, let me ask you another question, follow up. So I guess part of the problem is these private credit funds can show their defaults, de minimis, and the recovery is 90 cents on the dollar.

55:42Michael Batnick:What's the recovery? Well, the recovery is... Okay. So what's the recovery? Like a website? Like what do these companies have to recover? Well, some of them, a lot of like, so you could be secured by IP. Some of them could be secured by the ARR loans, the annual recurring revenue loans. If you lend to a business like a tangible business, there's property, plant, and equipment. It could be IP, as I said. So there's all sorts of stuff you can get secured by. And as long as you're a senior secured first lien lender, you're getting that. If things go wrong with Ritholtz Wealth Management, I'm selling these microphones.

56:17That's what's happening.

56:18Downtown Josh Brown:But I guess it's more obvious if a bank repossesses a building, it's more obvious that they have something that they can rent out and charge a rent and turn that into cash flow. Sure. It's less obvious that you can do that with IP or that you can do that with a room full of engineers who are going to leave anyway. So to that point, the recovery rates for private credit restructurings, particularly in software, are much lower than in the BSL market or the regular way loan market. They're in the, don't quote me on this, although I'm on a podcast, 30s, 35, something like that. Well, it's a good thing Anthropic and OpenAI and Google aren't in the process of disrupting everybody.

57:00Downtown Josh Brown:So, all right, can we move on? Here's New York Times. SpaceX, Elon Musk's rocket and satellite maker filed confidentially on Wednesday for an IPO. The company is committed to debuting in June. And Mr. Musk is aiming to raise$50 to$75 billion from going public. SpaceX values itself as more than a trillion dollars, would be one of the most valuable companies to reach the stock market. After Saudi Aramco's 2019 debut, which was at$1.7 trillion, Aramco raised$29 billion from that offering.

57:37Michael Batnick:So this will be the biggest raise ever?

57:38Downtown Josh Brown:I think this will be the biggest IPO of all time. Why do you think they filed confidentially? I guess because of what's going on in the market. I mean, ultimately, though, this is very positive for risk sentiment because if now's the time that they do it. Yeah, if it happens and it's estimated to happen as soon as June for now. Very interesting that it's now and it's confidential, I guess. He wants 30 % of the float to go to retail. He is, Elon Musk is the champion of the Tesla shareholder, and he's very anti-establishment. He doesn't care for the conventions of being a public company and having to, I don't know, report things and dealing with board of director issues.

58:21Downtown Josh Brown:He wants to talk to his audience, his fans, put the stock in their hands.

58:25Michael Batnick:So wait, how does this work? So they file confidentially as opposed to what, like a public S1?

58:29Downtown Josh Brown:Well, I think they will have to convert that to a public filing. but I think just for the time being, they file confidentially so that the whole S1 isn't in Bloomberg articles written by Alexandra.

58:41Michael Batnick:So Tesla's down 5.5 % today. I know they reported some of their car delivery numbers. I wonder, like, where does 50 to$70 billion come from? Obviously, institutional investors will be a big part of that, but is Robin getting a slice? I mean, they've all been marketing through these very ambiguous private funds, which is super interesting because they are marketing heavily to retail investors. And it makes you wonder, too, with all the fees, how much of that return retail investors would actually get.

59:04Downtown Josh Brown:Well, SpaceX is widely held by retail investors, to your point, through all these SPVs. So you're going to be reporting on this, or your team will,

59:14Michael Batnick:about some investors who thought that they held shares in SpaceX, so they bought an SPV, and uh-oh, the shares aren't actually inside the box, inside the box, inside the box. Only to find out that there are multiple tiers before that actual exposure.

59:25Downtown Josh Brown:Within SpaceX is XAI, which is Twitter. but it's also, it's the AI business of Elon Musk. It's Grok. And I don't know, you think that's a big part of the story here or is this really just about space, the rockets and Starlink? What do you think? Probably space as an asset class, as an emerging asset class, people getting more excited about that, I feel like across the board. The launch didn't, the launch this week, which was NASA, not SpaceX, but that didn't hurt. Yeah, absolutely. You think this would be the biggest IPO of all time? You think this is having the biggest IPO of all time? Is that a market top event that we look back at a year later and say, how do we not realize?

1:00:10I have no comment on anything related to SpaceX or this topic. Okay, fair enough. But what I will say about a market top, I'm always reminded of when Blackstone went public in 2007.

1:00:22Downtown Josh Brown:How about, yeah. I mean, it's, to me. But I will also say, how many times have we said so-and-so going public is the top? Alibaba was supposed to be the top. That was the top for Chinese tech stops. Everyone wants to call the top. That's true. We've been calling the top for the last three years. If we get SpaceX, OpenAI, and Anthropic hit the market inside of six months— Yeah, that would work. That would do the—I feel like that would do the trick because there's a lot of market cap that has to come from somewhere else to fund the equity being sold in those deals. My pinned tweet on Twitter, X, from August of 25, so something must have been going on then, is if people keep pointing to things as an obvious sign of a market top, eventually one of those will coincide with a market top.

1:01:05And so many are going to say, see, I told you that was the market top, ignoring the 50 other signs of a market top that were not coincident with a market top.

1:01:12Downtown Josh Brown:All right. All right. So, Dan, uh, so, so I look, I think that it would be poetic if getting three of the biggest IPOs ever inside of a six month period did coincide with a market top. It would make sense to somebody looking back years later who says, why did the market top or how did you know it was the market top? That would be like a top. That would be, uh, the type of thing that you'd say, oh yeah. But again, how many times everything is the top. I know. Jensen signing the bra.

1:01:45Michael Batnick:If that wasn't the top stop, I don't want to hear about it.

1:01:47Downtown Josh Brown:If that wasn't the NVIDIA top, then nothing is the top. It turns out you need more than that to make a market top. All right, enough of that top. So let's talk about bottoms. Snap has an activist, finally. This is the worst stock in the history of the stock market. Every time they report, they go down 20%. Do you know it's the worst stock of all time? Worse than Lyft? Oh, yeah. Worse than it? Way worse. Worse than Nike? Because they basically use it for stock-based compensation. They just - Oh, yes, that's right. I've heard the story. They threw themselves billions of dollars and the stock never goes up and they don't care and nothing ever happens.

1:02:17Downtown Josh Brown:And since it came public, it has been a net destroyer of more money than almost any stock you could think of.

1:02:23Michael Batnick:But doesn't Spiegel control the entire board? Of course.

1:02:26Downtown Josh Brown:Because he's like Diet Zuckerberg.

1:02:28Michael Batnick:So what is an activist going to do?

1:02:31Downtown Josh Brown:I don't know that an activist can actually do anything, but I just think the depth of the misery here. Does this have a dual share class? What's that? Does this have a dual share class? I don't think so. It might. No, it doesn't. Okay. I don't know the specifics of the board of directors, if they're staggered or if they even have any actual power. It might be easier. Does this look like a company that has an independent board of directors? Okay. So this company came public. It was like between 20 and 30. It's a$4 stock now. The high is in the 80s, which obviously happened in 2021 when the stock market was temporarily turned into a carnival.

1:03:08Downtown Josh Brown:It is in a 94 % drawdown. And this is multi, multi, multi billions of dollars have just been wiped out. Then you look at the compensation of the executives who run this company and they are paying themselves like they run Berkshire Hathaway. It is one of, I would say it's the worst stock I've ever seen.

1:03:27Michael Batnick:All right, so it turns out that Snap doesn't have a dual share class. It has a tri-share class. Okay. So the A has no voting rights. It just sounds. The B has one vote per share and the C's, 10 votes per share. And Spiegel and Bobby Murphy, I don't know who that is, but maybe his co-founder, collectively control over 95 % of total voting power. So there's your answer.

1:03:46Downtown Josh Brown:All right, so they have an activist now. This is a firm called Irenic and wrote a letter directly to Evan. We're writing on behalf of Irenic Capital Management, which manages$2.5 billion and we have become a substantial shareholder in Snap. we own two and a half percent of Snap's class A shares. He then goes on to, this is not like one of those activist letters where they trash the, this is way more constructive than that. But here's the headline. Snap should be worth a lot more than$7 billion. In our presentation, we outlined a path to$26.37, very specific. Call it the false precision of investment analysis versus today's$3.93 stock price.

1:04:34Downtown Josh Brown:That takes the company to$35 billion in market cap. And the main point here is it's the craziest thing. Didn't it jump like 10 % after that? Yeah. Everybody uses Snap under the age of, let's say 40 years old. Everybody, all day long. I was going to say like 25. Okay. But they can't, it can't stop using it. And this thing, this company can't find a way to make money. Do you know 38-year-olds using Snapchat? Yeah, I do. Well, they were 28 when it came out. You absolutely do not. Of course I do. Of course I do. People are 38. I don't use it. You're 38. Are you using Snapchat? I'm not on that. My kids never, the app is never closed.

1:05:15Downtown Josh Brown:Never closed. I have a 13-year-old. They have not been able to make money in however long this thing has been around. 11 years, 12 years. I don't know. How long should I get? It's$3 stock. Isn't it worth the risk that these guys convince him to do some of these things? And it actually -

1:05:31Michael Batnick:Your floor is only 100 % loss.

1:05:33Downtown Josh Brown:Yeah, the most you could lose is$4 a share. The most you could lose is everything. I think people want a turnaround story too. Look at Carvana, for example. Also super beaten down, saw a big reversal. If this thing turned around, it would be a big deal because I've never seen a stock in a 94 % drawdown not go to zero. Carvana. Carvana. Carvana. There you go. I mean, that's one. One example. I'm sure if I thought, well, I could give you a couple of companies that went bankrupt and then came back and did something. Totally different story. All right. You guys have fun on the show today? It was a great time.

1:06:07Downtown Josh Brown:Yes. How about you? Is this worth skipping Passover for? I didn't skip it. I'm just going to be late. He's going to rush home after this. I got a salmon in the oven. He's got salmon in the oven. I already spoke to you, Rabbi. You skipped it. All right. And then you came here and you ate an entire loaf of bread. I did. I absolutely did not. All right. I won the basketball game. All right. Guys, we always end the show by asking people what they are most looking forward to, right? How was Finland? It was amazing. Why don't you tell, yeah, tell us about that. I was going to say, now I have a really high bar for what I'm looking forward to because I just came back from the best trip of my life.

1:06:39I went to go, the goal of the trip was to see the Northern Lights. If you're ever doing a trip to see the Northern Lights, manage your expectations. It was very cloudy. And apparently those beautiful pictures that you see online, they're very rare to get to that extent. But it was amazing. Wait, did you see anything? Those photographs are enhanced. Yeah, I saw them very mildly through clouds, but it was still very cool. I was like in a small town in Finland on the border of Russia in the middle of the night trying to find them. Went husky sledding, fed reindeer. It was amazing. Highly recommend.

1:07:12Downtown Josh Brown:Big husky sledding guy. Yeah, yeah. How many huskies would it take to pull me out of sledding? Wait, wait. Huskies dragging a husky. Are reindeer friendly animals? Super friendly. So they're not like deer in the woods. No. They're like in an enclosure. They're still very shy, but a little bit more social, I would say. Okay. Like I was in an enclosure with them feeding them and they were all coming up to me. You're a big traveler, period. I am, yes. Okay, so where are you going next? I have to think about it. You haven't planned anything yet? I haven't planned my next trip. Okay. This time last year, I was in Guatemala hiking a volcano, which was a lot of fun.

1:07:44Downtown Josh Brown:Can I pitch you a trip? Yeah, please do. Looking for ideas. Aruba? Picture it. Boca Raton. Okay, perfect. Are you in? I knew that was going to be the recommendation. What about you? What are you looking forward to? She's in Guatemala going to Finland. He's going to the Upper East Side. I was looking forward to I'm going to keep the airlines running because I keep buying my next plane ticket. I was looking to from coming back on MGM. Where did I see you? Where did we see each other? I want to say Roseville Field Mall but it could be wrong. Oh no. We saw each other at the container store. Stop. In Roseville Field.

1:08:20We was with Pookie.

1:08:21Michael Batnick:Not Pookie. Sprinkles. Sprinkles. I hate the container store. Robin loves it. I hate it so much.

1:08:27Downtown Josh Brown:I have a college-age child, so you have to go to the container store once you have a kid in college. Worst parking lot ever. It's like literally the rule. In Roosevelt Field? It's not in Roosevelt Field. I mean, all over. Well, it's close to Roosevelt Field. It's in the Source Mall or whatever the new thing is next to the Source. What is that called? That thing.

1:08:41Michael Batnick:It's off the one top. That thing with the Trader Joe's.

1:08:44Downtown Josh Brown:This is the Long Island part of the show. Sorry. Worst parking lot ever. Anyway, how'd you do with those purchases? How'd your Tupperware turn? I probably returned to all of them. How'd your containers go? What did you buy? The container store? Containers. But what kind? There are so many different ones. Tupperware.

1:08:59Michael Batnick:The clear kind. They're drawers. Yeah, but there's ones that go in your closet. There's ones that go in your kitchen cabinet. No, my whole house is just container stores. Perfect. I have no furniture.

1:09:08Downtown Josh Brown:Just containers. Sounds very organized. All right. Guys, we're going to get out of here. I want to let people know how they can follow you two and where they can learn more and And what your preferred social network of choice is to be building your audience because you're both spectacular. Alexandra, how do people follow you? Very active on Twitter. Alexandra and NYC. Follow me there. I'm funny on there. You are funny. And what are you doing on Bloomberg? Do you have a set thing? Yeah, I'm covering U.S. equities on Bloomberg. So you can go and look me up and find my bio page on Bloomberg and read my articles.

1:09:46Downtown Josh Brown:And you're a future-proof regular. I am, yes. I should point out. Okay. It was my fourth time at Future Proof between Huntington Beach and Miami. So impressive. And hopefully we'll be there in September. You're going to come in September? Yeah. We just, I can't say who. I think we locked in our musical acts. I'm super excited. And oh my God. Well, you and I met for the first time at the fray. That's right. Oh, that's right. This is such great Future Proof memories. Yeah. And as a Future Proof, never. Are you going to make it there? I've never been invited. You're invited every single time. There's nothing for me to do there, to be honest.

1:10:16Funny enough, Dan and I met at a conference also. Where did you guys meet? We met at Diplo. Yeah, so Alex and I have raved together. At a hedge fund conference, funny enough. We were at a conference and - You guys have EDM'd together? Yeah. Funny enough. We both liked - Diplo was the weirdest act to have for this audience because no one in the audience knew who he was. It was like, well, except Dan and me. There was a VIP section that Alex was nice enough to escort me into when she was invited. No, Dan is forever indebted to me. And we were front row for Diplo. The group we were with, we knew who he was, but all the other people behind us didn't know what was going on.

1:10:53What is this? He's playing a set and it's just like tumbleweeds and a lot of like older finance guys. You know what's so funny?

1:11:02Downtown Josh Brown:Because you know what that is? That's like an event where they have so much money. Yeah. And they like ask somebody like, who should we get? And someone's like, oh, get Diplo. They're like, all right, just order Diplo. And like, you know, he's getting the check. It was in Miami. So it makes a little bit more sense. It makes a little bit more sense. It wasn't terrible. I mean, I think people. It was cool. Listen, Diplo is as good as you're going to get in that genre. Oh, yeah. You can't go. Jamie Foxx. I mean, I should say. Marshmallow. He's no Sugar Ray, but. Marshmallow maybe would have been more recognizable for that crowd.

1:11:36Downtown Josh Brown:I don't think anybody would have known who. No, but they've seen the head. Can we get a hint on the guest on the musical act? It is. You're obviously targeting Gen X. It's of the scene. It's of the scene. It is. Yeah. It's. Listen, it's perfect. It's perfect for us. I'm going to guess. Is it a band or like a single performer? Well, I have two, so. It should be Blues Traveler. We did that. We did that already. With Bush. Wake up. I wasn't there. You know, there was a rumor that they canceled because one of the band members got COVID, but then they were there.

1:12:05Michael Batnick:Who are we talking about? Blues Traveler? Yeah. No, he actually did get COVID. Oh. And he powered through.

1:12:09Downtown Josh Brown:And he recovered. Very nice. He recovered. Can't miss Future Proof. So, John Popper. Singer of Blues Traveler. they weren't sure if he was going to be all the way recovered. He was so good. They were so good. And I got to give him a hug after. So everyone was gone. He was coming out of the back. And I was just like, I have to say hi. True story. I've seen four million concerts in my lifetime. And Blues Traveler in 1995 at the Alumni Arena in the University of Buffalo was one of the best concerts I've ever seen. I think I saw, was that the Horde tour? Were we together? I might have. Is this when you invented them?

1:12:42Downtown Josh Brown:No, I wasn't in Buffalo, but I saw that same show.

1:12:44Michael Batnick:You claimed that he invented Blues Traveler on this show.

1:12:46Downtown Josh Brown:No, I really did. No, I really did. They're from New York. No, I honestly did. Are they from Eric? No, but I honestly, I knew about it before anyone, and I had all the CDs, and I was distributing them, like, to summer camps. That's how it happens. And it turned into a thing. That was like me with Cypress Hill. So, all right. I don't know how we got here, but Dan, where do people follow you on social media? It's fine. All right, guys, thank you so much for listening. We appreciate you. We'll talk to you soon. Very loud, David. Guys, that fun? That was so much fun.