Prof G Markets: Trump’s Memestock Goes Public, the Problem with DEI, and Daniel Kahneman’s Legacy

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0:39From afternoon coffee runs to stocking office supplies and even team dinners, you can earn miles on all your business expenses. Plus, you can earn 125 ,000 bonus miles for a limited time through October 29th. The Delta Sky Miles Reserve Business Card. If you travel, you know. Minimum spending requirements and terms apply. Offer ends October 29th, 2025. This week's number,$3.1 billion. That's the estimated amount Americans spend on Easter candy this year. Ed, do you want to hear my favorite candy poem? Please. Jack and Jill went up the hill so Jack could lick Jill's candy. Jack got a shock and a mouthful of cock because Jill's real name was Randy.

1:28From the Bucks Media Podcast Network. Do you think we're going to survive this? Do you really think we're going to survive this? Yeah, we always do. I don't know how. We always survive it. That beat out. That beat out. Do you know why? You know what people call me? Because I love rhesus. Sorry, what? Do you know what people call me? Because I love rhesus peanut butter cups. I don't know what they call you. They accuse me of being a rhesist. Yeah, that's... Rhesist? Got it. That's a terrible joke. Yeah, the mouthful of cock one was definitely the way to go. Randy wins. Yeah, Randy wins. Okay. Every time.

2:04All right. Today we're discussing Truth Social's IPO, DEI failures. Oh, really? I thought DEI was totally immune from all scrutiny. Oh, my God, I sound like a fox host right now, don't I? I'm literally, I'm getting older. And the legacy of Daniel Kahneman. Here with the news is Profit Media Analyst Ed Elson. Ed, what is the good word? I'm doing very well, Scott. How are you doing? I'm actually stressed. For the first time in my life, I have this really nice lady. Nice lady, listen to me. I am a fox host. I have a doctor who comes to my house, and for the first time in my life, why is that a lot?

2:44Why is that? Just learning who the lady was. Yeah, it's a doctor. Doctor. I don't even know her last name. I just really like her. I just call it Doc. Anyways, my blood pressure was almost outside the normal range, and I'm clearly getting old. I've never had any doctor ever tell me they're usually like, oh, this is amazing, and this is amazing and you have good blood you have all the you know and she's like yeah your blood pressure is borderline i'm like what i'm like take it again so anyways the answer is uh how am i i'm clearly stressed out something's going on and i can't figure out what it is anyways i'll blame it on the ketamine or the weather or the weather it must be the weather is that what she said she thinks it's stress so no she said it's nothing to worry about it's still in the normal range i'm like i'm not used to being in the normal range i'm used to being in the you know perfect range Yeah, the right range.

3:30It's got me a little bit freaked out. Well, you're going to Africa next week, so maybe that'll help. I'm going to Egypt. Start investing in this relationship. I'm going to Africa over Christmas. I'm taking my sister and my nephew and niece. I'm going to Egypt on Saturday. Hold on. Do you think that Egypt isn't a part of Africa? Oh, are you accusing me of being a racist? That was good. That was good. Egypt is in the continent of Africa. I just want to make sure we're clear on that. I've heard. I've heard. But I thought you meant, I thought you were referring to my trip. I'm going to South Africa over the holidays.

4:02Different Africa trip. Yeah. Okay. Anyways. Well, yeah. Are you excited for Egypt? Yeah, I am. We're doing one of these flatboat river cruises. And it's great. You meet a, you like do all these cultural things, which I hate, but supposedly it's good for kids. So we're going to see the Sphinx and the pyramids and spend a couple of days in Cairo. I'm curious to see how my kids react to Cairo. Yeah, I'm excited about it. We're going with another family. The key, just a pro tip, once your kids get above 10 or 11, if you don't travel with other families and other kids, it's a nightmare. Your kids are not impressed.

4:35They don't want to relax. They don't care about food. They don't care how beautiful the place is. If you don't have other kids with you, they just turn on you. They just turn on you, and they turn awful. So anyways, we're traveling with another family, the Bjorgesons, who are with this wonderful family with cool kids, and the parents are fun. So it's not easy to find families you like who have kids. It is not easy. The mom's got to get along. The dad's got to get along. The kid's got. If you find a family you can travel with, hold on to them, Ed. Hold on to them. Anyways, get to the news. Let's do it.

5:08Let's start with our quarterly review of Market Vitals.

5:17The S &P 500 had its best start to the year since 2019, climbing about 10%. The dollar rose marginally. Bitcoin soared 60%. And the yield on 10-year treasuries increased about 8%. Shifting to the headlines. Boeing CEO Dave Calhoun is stepping down at the end of 2024 as part of a larger management shakeup. As we discussed in previous episodes, Boeing is dealing with a slew of safety concerns and its stock is down more than 20 % this year. Baltimore's Francis Scott Key Bridge collapsed after a cargo ship lost power and struck the bridge early Tuesday morning. The disaster will have sweeping impacts across the economy, disrupting ports, trade, and about 155 ,000 jobs.

6:00Krispy Kreme's stock soared almost 40 % after it announced it will sell its donuts at McDonald's nationwide by 2026. That news provided relief to Krispy Kreme shares, which were down 20 % year-over-year, largely due to Ozempic concerns. And finally, Reddit's stock fell 14 % after Hedgeye Risk Management said the stock is quote, grossly overvalued and should trade at about half of where it is now. The next day, Reddit dropped another 10 % after its CEO and COO disclosed they both sold about half a million shares each. Scott, thoughts? Look, the Boeing CEO, I think they did the right thing. Also, I believe the chairman of the board resigned.

6:41And we talk about this a lot. Crisis management acknowledged the issue, have the top guy or gal address the issue, take responsibility, and then overcorrect. And this is them overcorrecting. This is, if Boeing planes don't maintain the brand image, and I still think they have this, but the brand association of safety, I mean, that could literally take the firm out. The reality and the perception needs to be that they're taking this very, very seriously. From your experience on boards, how does firing the CEO or asking them to step aside usually go down? I'm not sure I've ever been in a situation like this, But I would bet there's a more than likely like an 80 plus percent likelihood that the call went down something like this.

7:21The board met and said, we just have to show the market that we're serious here. And my guess is the chairman or not the chairman, but the head of the lead director called and said, this sucks. We recognize a lot of this is out of your control. But given what's going on, we have to show the marketplace that we're making serious changes. We're going to ask you to step down. And he's a grown up. I bet he understands. At the end of the day, the buck kind of stops with him. So heads got to roll here. And my guess is heads are going to roll all over Boeing. But if the CEO or the top guy's head didn't roll, that just sends a bad signal about how serious the board is and just more like, okay, senior people who play golf with the board always seem to survive.

8:03Should we move on to this Baltimore bridge and collapsing? Any thoughts on that? There are so many ships, so many moving parts in our infrastructure. sure. I'm surprised more freak accidents don't happen more often. I used to, when I was going down to South Beach, I used to, I had a place in the Continuum down in South Beach, which was lovely, which was lovely. And I'd go down to the Smith and Walensky and I'd order one margarita, two margarita, three margaritas. After three margaritas, watching the ships come in and out of the cut there in Miami is fascinating, Ed. It's fascinating. These cruise ships, especially I on Friday afternoon would steam out of there.

8:41And you'd look at these things and you'd think, how do people not crash and die every day on these things? It's just amazing that they figured this shit out. So where I went was not knowing anything about the accident was, one, America always feels like it needs to find someone to blame. And I wonder if this was just a series of unfortunate accidents. And the other thought I had is that I'm glad the infrastructure bill passed because I think we take for granted how important our infrastructure is and how much upkeep it needs. And you hear about what happened to the apartment complex in Florida, where, I mean, the thing just collapsed in the middle of the night.

9:17That just shouldn't happen in America. Do you have any thoughts? Well, it was interesting that this coincided with the Carnival Cruises earnings report, which came out the following day. And they pointed out that they're going to lose 10 million a year because of this collapse, because one of their main ships is based in Baltimore, etc. But just a sort of a side note, the earnings from Carnival Cruises were exceptional. Like they had record revenue, five and a half billion, record net yields, record customer deposits, just kind of separate from this bridge collapsing. They're doing better now than they were before the pandemic.

9:52And it's just kind of staggering to think about how much these cruise line companies have bounced back from COVID. I mean, I remember when COVID hit, and that stock fell around 90 % and everyone was talking about how it was going to go bankrupt. And so just seeing these earnings, I mean, it's a crazy turnaround, which I was thinking, I'm pretty sure you predicted this, right? Didn't you at one point say that you thought that cruise liners were going to come roaring back? Am I right about that? I wrote a No Mercy, No Malice blog. That's our newsletter on Friday. I shouldn't call it a blog. And I wrote an entire post on how I thought Norwegian cruise lines and carnivals were amazing stock buys at that point.

10:31And literally within like two weeks, I think, of writing that, they got cut in half again. They went down 50%. It's always happened. You're too early every time. The key is holding on for a long time, I find with stocks. But anyways, demographics are destiny here. And what do you have? The fastest growing population in America are old people. And also the population that is aggregating wealth faster is old people. I mean, between Social Security being up to 9%, between the fact that they own real estate, they own stocks, their 401ks have exploded. It's just a perfect storm of good things. And cruising just gets more and more popular every year.

11:09And this is one of the ways I can tell I am getting older is a cruise doesn't sound like the seventh circle of hell for me. I actually think, oh, wake up in a different city. That sounds nice. 24-hour buffet. Oh, wait, they have trivia games and the dance hall? All of a sudden, like everything that horrified me when I was your age sounds like now kind of appealing. Quick story about my dad, which will give you insight into my dad. When my dad got fired for like the fifth time during reengineering and realized corporate America wanted nothing to do with him. He was like traveling around living off of different women through the U.S.

11:40And he decided he was living in Arizona. I think it was about 70, 75. And he worked for the cruise lines. And what they do is you could be, you could go on a cruise and they pay you a small amount of money, get to cruise for free. And all you had to do was dance with at least, I think it was eight women, different women a night. My dad was basically a man whore. And they have these guys, they have these older, charming gentlemen on boats because men die before women. And so these cruises are populated with a ton of older single women. and my dad, my dad was like a pig in shit. He likes to dance.

12:23He loves attention from women. You know, it's just all of this stuff. He's also very charming. And, you know, at one point was very handsome. We need to get your dad on the podcast at some point, by the way. I feel like we're hearing more and more about this guy. Yeah, yeah. But I just thought it was hilarious. And me and my sister and I would get on the phone. I'm like, yeah, dad's somewhere off the coast of Key Largo dancing the night away. That is so funny. Yeah, look, it's an amazing business. I like it because it's capital intensive, so you just can't spit out ships that quickly. That was just an unbelievable buying opportunity during COVID, just to make sure there wasn't a bankruptcy risk there, which I don't think there was.

13:00But Brits Carlton just launched cruise ships, Four Seasons is launching cruise ships. That business is just going to continue to boom. We should move on after this, but I just want to make a point about Reddit and ask you a question. I found it very interesting the fact that the stock fell 14 % after that short seller report came out, specifically because it's just such a significant drop on news of a barely important, semi-important investment firm saying that they're considering shorting the stock. And they didn't even confirm that they're actually going to short it. They just said, you know, we're considering it.

13:36We might. As we've discussed, you're a shareholder in Reddit. does it concern you at all that reddit stock is so sensitive to relatively insignificant news like this in this instance i think the market was probably at least on this trading day looking to take the stock down and use that as an excuse so i don't know if that report i mean first off the stock has been exceptionally volatile since its ipo last week and so i think the media tries to latch on to a reason i'm not sure we don't know we don't know if people read this report and started selling. It's also a low float, a fairly small float.

14:10It could be the meme of all meme stocks if Redditors decide to take it up for whatever reason. I don't think that's happened so far. It really comes down to the following. If Reddit can show progress against monetizing their traffic, this stock's going to skyrocket. If they continue to demonstrate an inability to monetize this firehose of traffic, it's going to get cut way down. We'll be right back after the break with a look at Truth Social.

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16:23We're back with ProfG Markets. Donald Trump's social media platform, Truth Social, went public with shares popping as much as 59%. The stock swung wildly through its first day of trading, prompting the Nasdaq to temporarily halt trading before shares closed up 16 % from the issuance price. Truth Social rose another 14 % on its second trading day, giving the company a market cap of$9.5 billion. Just a note, this stock is very volatile, so it will likely swing again by the time you hear this. Scott, speaking of meme stocks, we have our newest one. What do you make of Trump Media Group? I think it's insane.

17:02I don't, I mean, okay, ground zero for the hottest company in the world, NVIDIA. I mean, people think this thing is, most analysts say, it's near impossible for this thing to grow into its valuation. It's trading at 37 times sales. Reddit, you know, which is a lot of people think is probably trading at a very, you know, very lofty multiple. I think it's at somewhere between 9 and 11 times sales. Okay. Truth Social is trading at 1 ,500 times annualized sales. Do you realize, Ed, that – do you realize this year, Prof G, the Prof G pod, not Pivot, the Prof G pod, we're going to clock register more revenue than Truth Social.

17:43Yeah. And we'll be profitable, and we won't lose$59 million, and I'm pretty sure we're growing faster. Yep. So if you want to talk about the meme-iest meme in meme land, this is true social. And let me be clear, this is not financial advice. I wouldn't get near this thing right now because it has no basis in gravity or reality. And that is, I mean, the corruption here is so ripe for the potential for corruption. I wonder if a president who, say, lacked moral fiber and was under threat of going bankrupt might say to somebody, hey, I saw you're a big, big shareholder in ByteDance. I will ban the ban or, you know, whatever, figure out a way for you to make billions.

18:33if you maybe take 10, 50, 100 million bucks and go aggressively at buying True Social for the next six months until, I mean, this is a way basically of getting Donald Trump money or showing your support for him. Because anyone who's buying at these levels is not buying based on anything resembling. I mean, I guess you could argue if he becomes president, it might have a shot, but this thing has 5 million, I think 5 million users, monthly active users, I think. 1 million. I'm sorry, that was 1 million? I've seen 1 million daily active users, DAUs. Oh, here we have active users at IPO. Facebook, 845 million.

19:09Twitter, 215 million. True social, 1 million. Okay. So I don't know what to make of this other than I would tell someone, just stay the hell away from this. You don't know what's going to happen here. This thing is volatile, wild swings. And I just wouldn't be surprised if in several years or several months we find out that there was something weird going on here in terms of who was buying the stock and keeping it elevated. What'll be the most interesting point is Donald Trump, who owns 60 % of it, is locked up. He cannot sell for six months unless the board, which consists of his son, the CEO who's in his back pocket, Devin Nunes, the walnut farmer turned congressman, turned head of social media network that has 1 million people, to Linda McMahon, a failed Republican Senate.

20:02I mean, this is basically, this board makes the Tesla board look like a model of good corporate governance. And so he might just say, change the rules, get rid of my lockup, I want to sell tomorrow. But they have to disclose that. And the day either before he can sell or the day it's announced he can sell, oh my gosh, watch out what happens to this stock. Because while people love Donald Trump, I think the majority of them love their money more. And they might say, oh, who knows what's going to happen? I'll invest. Let's go Brandon, whatever it is. Let's take women back to old Spain with Donald Trump.

20:41I'm going to buy some Truth Social, whatever it is. But I think once they realized they could lose 90 % of their capital in 48 hours, which this could easily happen here. And that trigger, you were talking about a hedge fund issuing a report and it's sending the stock off 10%. The moment it is clear that in short order, Donald Trump could sell his shares, because I don't think he's going to do like a measured sale. I don't think he believes in the... He knows this company is just total horseshit. He knows it. Once he's able to sell, Look out below. I mean, so just for context, he's got a$454 million civil fraud case.

21:22He needs$175 million to put the judgment on hold. So he needs to find that$175 million somewhere. And so, you know, everyone's looking at this and saying, okay, well, this is going to be his financial lifeline. Maybe he can sell his stock. I mean, that's what you just mentioned. The other thing that people say is, oh, maybe he'll borrow. The thing to remember with this company, as you've mentioned, This is a company with a million users. That number is declining. It's doing less than$4 million in revenue. Its website traffic is falling nearly 30 % a year. I just don't think that any credible lender is going to let Trump borrow against this thing.

22:01I mean, it's barely a company. So I think he's stuck because he can't really sell and he can't really borrow. I think there is one thing he could do, and this is when they created the SPAC, They sold$300 million worth of shares to investors. And that money is sitting in the company right now in cash. So I think Trump, I mean, he's clearly aware of this. I think the question he's asking himself right now is, how can I get that cash out of the company? And the most logical answer to me, I think Trump media group's going to announce a dividend. They're going to give the money to shareholders. Trump takes 60%.

22:41It'll all be money that was in essence put up by, you know, his supporters who bought the stock and he'll use that money to pay off the lawsuit. So it would be one of the greatest grifts ever. The strategy you're recommending, I think the company lost$59 million. I mean, that's shareholder lawsuit crazy because what does it have? 180 million in cash. Is that right? Got around originally 300 million. I think they've lost around 75 million because of all of these lawsuits that they've been having to deal with, with those guys on the board who are now going to jail. So I think it's around a little over 200 million now.

23:15The dividend would solve some of his problems, but that's an automatic shareholder lawsuit because a company that's losing this much money with so little revenue, you're not acting as a fiduciary when you just push out. I mean, what you could do potentially, what would be more of a fiduciary is to say, this company makes no sense. We're closing it down and we're distributing the cash to the shareholders. But if you're supposed to be a fiduciary and ensure this thing's going to be an ongoing concern, then you can't say, oh, we decided to give... And there's emails. They would get the emails and I would say, the only reason you did this distribution is because you got pressure from your larger shareholders going broke and you've put every other shareholder at risk because we don't have enough cash now to operate for longer than 12 or 18 months.

23:57So this feels, you're right, he's painted into a corner. But the thing about President Trump is I think he probably says, don't worry, trust me, it's worth$10 billion. It will sell it all. It'll be worth$2 billion. I'll get my$1.2 billion. All you people on the board will get your$10,$30,$50 million. Yeah, it's going to go down 80 % or 90 % as we sell this stuff, but it'll be okay. I'm going to be president and I'll make sure that everyone's fine. That's kind of his thing. Trust me, don't worry. And then everybody ends up in a courtroom. One other thing you mentioned, you talked about ByteDance just now, and that we're going to find out something shady about this company.

24:37I looked at the shareholder list. The biggest institutional investor in this company is this investment firm called Susquehanna, and it's run by this guy, Jeff Yass, who's friends with Trump. susquehanna's it's largely a trading firm but it also does some private investing as well and in 2012 it invested in a small chinese tech company called by dance so susquehanna is the largest backer of truth social it's also one of the largest investors in byte dance it owns 15 and as we know just a couple weeks ago trump announced he was reversing his position on the TikTok ban. So it's clear Jeff Yass has Trump in his pocket.