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One of my favorite charts in here, they did, it's going back to 1984,
and they did the Russell 1000 growth versus Russell 1000 value,
and they have the rolling five-year total return charts, which is pretty cool.
The ability to do a rolling chart like this is cool, because you can see when the divergence
does happen, like in 2000, of course, and then in 2005, growth first in value, now back to growth,
but the average return for these, for the average five-year return,
is almost identical between growth and value.
It's a little over 11% since the mid-80s per year,
and I'm guessing that if you would have done a 50-50 growth value in rebounds,
you probably would have done it better.
I like these charts.
It's going to actually do that.
I make these by hand.
You see the one on the bottom pane?
So you've got the rolling five-year, and then you've got the difference to really bring it to life.
Yes, you like the spreads.
Yes, this is a really cool chart.
Yes, I probably don't use these rolling annualized returns enough on white cards.
Am I more of a spread guy or a dump guy?
You know, I've been to the dump like three days in a row.
Just cleaning house, I love it.
All right, love it.
Fall cleaning, good for you.
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Welcome to animal spirits, a show about markets, life, and investing.
Join Michael Batnik and Ben Carlson as they talk about what they're reading,
writing, and watching.
All opinions expressed by Michael and Ben are solely their own opinion
and do not reflect the opinion of Redholtz Wealth Management.
This podcast is for informational purposes only,
and should not be relied upon for any investment decisions.
Clients of Redholtz Wealth Management may maintain positions
in the securities discussed in this podcast.
Welcome to animal spirits with Michael and Ben.
Happy middle aged week to Ben.
Ben was, Thursday was your birthday, and you turned 40 what?
Two, 42.
How does that feel?
That's probably exactly middle aged, right?
If we're if we're
hedging here.
No, tech maybe literally middle aged, although we already
we already decided middle aged is your 50s.
I don't know, we decided that.
Well, we decided.
I decided.
No, the internet decided for us.
You know, I had something of a middle aged moment too actually.
I hurt my shoulder,
and I don't know how I did it,
so I'm just going to assume that I was sleeping.
Okay, this is what I was thinking.
Like, like, like, like, like, clicking thing?
Wake up, sore.
Five, no, it's been like three, three, four weeks.
Saturday night, it's 11.30.
I've already been asleep for over an hour.
I'm going to deep sleep.
I might have, might have drank earlier than that.
I'm almost suddenly here knocking on my door.
And I immediately credit to me,
pop up and run downstairs.
I'm like, what the hell?
So I get back up, open the door.
Nobody's there.
Get back upstairs.
Ask my wife, like, like, look at the camera.
Who was that?
Neighbors.
Little rascals.
Little rascals.
Playing, playing it.
What do you call it?
Ding dong bitch.
I call it ring and run.
Ring and run.
Ding dong bitch.
Same thing.
Ding dong bitch.
Yeah, you ring the doorbell.
Not going to the door when you run away.
So like five minutes later, they did it again.
At this time, I run downstairs and out the door.
Am I on these?
You yell at them?
Yeah, I did.
I couldn't find them.
They scattered like ants.
I saw them hiding behind the bushes.
And I said knock it off, kids.
Yeah, my ring camera has got you.
Let me show your parents.
All right.
I got no of the middle aged takes.
That's a, I did, I did read a blog post though about
I've been thinking about how much different entertainment options for me and my kids are
because I'm making the case in a blog that streaming services should be pricing higher.
Like there's those charts of showing streaming prices going up.
They should be way higher.
If you think about how we consumed entertainment in the past,
you'd walk around blockbuster video on a Friday night.
And there might be seven copies of a new release movie.
And if they're all out, you'd have to go like look through the return bin to see if it was there.
They might have one copy of an old movie.
Like I don't, I don't think people realize how great they have was streaming.
Definitely not.
Do you remember Columbia House for getting CDs?
You would pay one penny to get like kind of 12 CD.
Yeah.
And then they'd send you something every month.
And if you didn't send it back to them, then you had to buy the CD.
For like $24.
I would forget it all the time.
And I have to buy like the CD the month that I didn't want.
I'm just saying technology has improved so much for entertainment options.
That people don't realize how good they have it these days.
Over the weekend.
Way harder in the 90s.
My kids are getting into Ninja Turtles.
We haven't seen the new one yet, but I'm very excited to see it.
So I showed them the originals, at least as far as their originals to me.
One of the first ones like 1989, I think the second one was 1991.
Fun fact, I had my six birthday party at the movie theater.
We saw a secret of the use.
Okay.
Was that before or after you saw what movie did you see it five years old?
You feel the dreams.
You feel the dreams.
I mean, I'm like I'm I'm really.
So your fifth birthday was filled with dreams.
Your sixth birthday was Ninja Turtles.
I'm pretty sure I suffered the dreams of the theater.
Anyway, I had two thoughts watching that movie.
Number one, pizza is the best inflation hedge ever.
They got a pie for $13 in 1991.
Wow.
It is true.
Pizza.
Like if you put the inflation number on pizza.
I'm sorry.
Gold is regular pizza is $30.
It's $40 right now.
The other thing that I had, the other realization,
is it holding all these at?
Is that Sam Rockwell?
Went to the IMD base.
Sure enough, Sam Rockwell was like a foot soldier.
Oh, I'm a big Sam Rockwell fan.
All right, this is the week that.
But anyway, hold on, just to put it on this.
You're right.
You dial up secret to the US $4.
It's just everything's right there.
Whatever you want.
It's so easy.
Yeah, we'd take it.
Whatever you want.
I think we'd take it for granted.
How hard it was to find.
My other thing was in the summer,
TV schedule in the summer,
the TV channels used to literally say,
no more news shows this summer.
Go do something else.
It was like September to May was new TVs.
And maybe they had a pilot or a game show or something in the summer
or some repeats.
But other than that, there was like no new shows in the summer.
It was just kind of like,
hey, everyone just decides TV's done for the summer.
Oh, yeah, people are complaining right now
that there's no good shows on.
Oh, yeah, there's like four million.
Yes, yes, exactly.
Literally in the summer, there'd be no new shows.
It was crazy.
Although I had that by one of those people complaining.
But shame on me.
Fair.
Forgot how good we have it.
All right, new high in the 10-year treasury
going back to 2007.
I found that October 2007.
And this has been the story of the last month or so.
It seems like we have six week cycles now for the economy.
Right, we go from stagflation to hard landing,
to soft landing to now, I don't know, growth accelerating.
I don't know what we call this.
The Wall Street Journal has a story
that the era of historically low interest rates could be over.
And this is something that me, especially,
and I guess I could lump you into,
probably been the most wrong about over the years.
Where we thought rates were going to stay low for a long time.
Or rates couldn't stay high for this long.
Because something would break,
or the government couldn't afford it, or whatever it is.
A hand up, I was certainly wrong on that.
But they're saying higher productivity and increased deficits
could raise the neutral rate of interest rates,
limiting Fed cuts in the future.
So they're saying the potential growth could be higher,
swelling government deficits and investments
and clean energy could increase demand for savings,
pushing the neutral rate higher.
Basically, the neutral rate, I guess,
is just what the Fed settles into,
which is funny because it seems like there's never
like an equilibrium.
It's always just moving.
Let me ask you a question.
What about this whole idea that tech was the most powerful
deflationary force in the universe?
Is that over?
It seems like a premature
to make that claim in my opinion.
I totally agree.
I think trying to make any sort of secular call right now,
as opposed to cyclical is really difficult.
Because there really have only been three interest rate regimes ever
in the modern era.
It's flat from the 1920s to the 1950s
on all the 1980s and down since then.
So it's really hard to make one of those pivot turns.
I think it rates.
And if anything, I think things will be more cyclical going forward.
But I think it all comes down to government spending.
And if you're trying to hang your head on one thing or another
of higher rates and higher inflation going forward
or back to lower rates,
it really depends on what the governments are going to do
around the world and how much they're going to spend.
I think that's the tell.
And so if you're trying to guess politics,
which is probably more impossible
than trying to predict the markets,
here's my question for you right now.
With rates so high,
our bonds more attractive than stocks right now.
So this is from the Wall Street Journal, 10-year tips.
This is real yields are back to above 2%.
I've always been taught that anything above 2% to 3%
tips is like a screaming buy signal.
It's like, if you see on here,
it hasn't happened very often since.
A screaming buy for what?
For tips, because you get 2% above plus the inflation kicker.
So a lot of people wondered,
well, what the hell happened?
I bought tips because I was worried about inflation
and then tips got crushed.
But if you look,
tips had negative real yields from 2020 to 2022, basically.
Well, also, I mean, that's the inflation real yields.
So the inflation component is part of the pie,
but when rates go from zero to five,
you know, they're bonds.
Yeah, that's the thing.
People didn't realize that.
But now you have 2% real yields,
which is great.
Again, you're actually getting a yield plus the inflation kicker.
And if we're just talking regular nominal bonds,
rates go up, obviously, that's not good.
That's what people are worried about now is rates continue
to go up because the economy's accelerating.
But if we have higher for longer,
where like rates just kind of stay where they are
and maybe in a tight range, that's good.
If we have a recession in rates go lower, that's good.
Isn't, I don't know,
I'm not like a short term, intermediate term guy,
but I think if you put them side by side,
you'd say bonds probably have the better bet right now
with the understanding that-
When you say, when you say right now,
what do you mean?
Bonds are more attractive than they were three years ago.
Do you mean right now?
Relative basis.
Right now for the next 12 months.
Like, what's your time frame?
It depends on what happens to rates, I suppose.
But I think if we're looking at stocks and bonds right now,
you could make the case that bonds
are relatively more attractive than stocks,
which is that's something I would have imagined myself saying.
Relatively, okay.
I think bonds are relatively-
Like if we're going to play out the different scenarios,
there's probably way worse scenarios for stocks
than there are for bonds.
Yeah, I mean, bonds have a much bigger margin of safety
with rates at 5% than they did when they were at zero percent.
But I still think people are looking at the losses
and going, no way I'm putting money into bonds.
So I-
No, no, no, no, you keep saying this, but it's not true.
There's money that has been flowing into bonds
for like 35 consecutive weeks.
Then, why are rates rising still?
If money's flowing into bonds, why are rates rising?
Because, dude, the supply of bonds is not capped.
The treasure is issuing new bonds all the time.
It's our corporations.
But if there was high enough demand for bonds,
rates would be falling not rising.
It's not enough to like-
You're talking about mutual funds and stuff
where the bond market is enormous.
And if there's government selling,
the mutual fund ETF money is a drop in the drop in the-
Buying pressure is not enough to drive rates.
Well, it is if it's the Fed doing it, I guess.
Right.
But so I tweeted this out last week.
So the long-term treasury, TLT,
20 plus year US Treasury bond ETF,
is down 2.4% over the last nine years.
We're closing in in a lost decade.
And a lot of people try to actually mean say,
no, you must be looking at price returns.
There's no way that's possible.
And if you look on my chart here,
it says total return.
This is income included.
We're coming in on a-
And if you can see, it was close to up to,
I don't know, halfway through this period,
two thirds of the way through is up like 60 or 70%
from that blow off top and yields falling.
Now we're closing in in a lost decade
in long-term treasures,
which is kind of nuts considering
how great things were coming into 2020 with these.
Yeah.
So, the bespoke had one too.
Since February 19th of 2020,
which was the peak of the market before COVID hit,
TLT is posted a return of negative 32%
arc is down 31%,
which is again kind of crazy for how well
these things did during the COVID bump.
One of the things that I heard from a lot of people
that I've been writing off bonds lately
and talking about them is,
listen, I don't care about bond losses.
I'll just hold my bonds and how maturity.
That's my hedge.
I can just hold to maturity.
I don't need to worry about these losses.
You see the seven to 10 year treasury
is still down 21% or so.
To which I say,
that's a great psychological trick,
but it doesn't mean that you're not losing out in some way.
Like the whole bonds to maturity,
people think they have this like secret way
to make money in bonds and not lose money.
That's a good point.
People value principal protection a lot
because you're right.
If you're buying an individual bond
and you hold to maturity,
you will get your money back.
But what if you bought that bond at two and a half percent
and it was a 10 year bond?
So you hold that bond for 10 years.
Congratulations.
You get two and a half percent
you get your money back.
Rates go up to five percent.
What do you still hold in that bond
because you get your money back?
What about all the missed out?
What about the opportunity to cost
and not getting higher yields?
So you're 100% right.
Cliff Asnes had this thing,
it must have been 10 years ago,
like his big top 10 investing pet peeves
and he talked about the whole
hold to maturity,
individual bonds versus bond fund things.
And he said,
I always go back to this.
He said bond funds are just portfolios of bonds
marked to market every day.
How can they be worse than the sum of what they own?
The option to hold to maturity
and get your money back is apparently greatly valued
by many, but is in reality value-less.
The day interest rates go up,
the individual bonds fall in value just like the bond fund.
By holding the bond to maturity,
you will indeed get your principal back,
but in an environment with higher rates and inflation,
those same nominal dollars will be worth less.
The excitement about getting your nominal dollars back
alludes me.
Not me.
I totally get it.
And I get where Cliff is coming from,
but this is how people behave.
This is the thing.
This is the whole kicking group.
Yes, it's a business side.
It's funny to me that some people think like,
I've got it all figured out.
Like, I'm smarter than the bond market,
but this is not the way things work.
If you just sold your bonds at a loss,
or your bond fund at a loss,
you put it into shorter from bonds at higher, whatever.
It's a psychological safety plan.
Can I completely agree?
Yes.
So there's a chart from Bloomberg that we said like,
there's like hedge funds are short treasuries
as it managers along treasuries.
So there's a chart showing
asset managers net long positioning,
tenure treasuries futures.
Is it the highest level that it's been since,
whatever, 2006?
It says investors are positioned for yields to fall.
I don't agree with that sentiment.
I think it's rational to take advantage
of unlocking higher rates for a longer period of time.
So just because you buy a 10-year bond
at 4.4% or wherever the yields are,
it doesn't mean that you think
that they're gonna go down to 4% tomorrow, right?
It means that, no, no, no.
I'll take 4.4% for the next 10 years,
and if rates go down to...
I'm locking it in.
Yeah, I'm locking it in.
So if rates go to 4.7%, well, yeah, rather they not,
but that's okay.
I'm locking in today's rates.
It doesn't mean that there's a market timing call.
And again, it's the highest rates we've had
in over 15 years.
So I think that that totally makes sense.
Here's my funny thing about the finance world.
And I know why this happens,
but the 10-year yields of the highest in 2007,
meaning people finally have some yield they can earn.
Wage growth is up, GDP growth is accelerating,
and Wall Street absolutely hates it, right?
Like everyone is bearish now because,
but my whole contention is...
Wait, wait, hold on, hold on, I unpack that.
What even Wall Street hits what?
And when you say Wall Street,
what do you mean Wall Street?
Do you mean strategists?
Do you mean the bank?
What do you mean?
Don't you think rates rising has turned everyone bearish
on the last month?
But my whole contention is, wait,
rates are finally rising for the right reason.
Like rates didn't get this high during the inflationary
spike on some of these bonds.
And the whole Fed tightening thing,
like inflation has fallen, rates are rising
because growth is rising.
Isn't that a good thing?
Yes.
So on the one hand, I think that when you say
or bonds relatively more attractive,
they're definitely more attractive to themselves
than they were.
That's for damn sure.
But I do also believe that this should cause
a repricing of multiples for stocks.
I just do believe that.
Not saying it happens overnight,
but if stocks were trading at 20 times earnings
with a 10-year yield at 1%,
I don't think they should trade at 20 times earnings
with a 10-year yield at 4.4%.
Sorry, I just don't.
Now, I don't know where the right number is,
but I also simultaneously have a hard time
getting too bearish on stocks
because the economy is too good.
Yes.
And it's also that's the funny part, too,
that you're point about rewriting
and valuations totally make sense in theory.
But then why is the Nasdaq up 35% this year?
That's the part that...
And in Vittys at an all time high right now.
So you have to do the shit's hard.
Like we're trying to like make sense of it all
and it's just hard.
And if you look at the, this is through Monday,
the correction, I think these things just happened faster
where stocks are going up.
I'm everyone's bullish and stocks are going down.
Everyone's bearish.
This is a very, this is a, as they say,
a garden variety correction.
That's the fact.
100 is down four or five percent.
The Nasdaq is down five or six percent.
The Vix, the Vix never got over 20.
This, this was nothing.
I mean, whatever stocks, if rates keep going up,
maybe stocks do continue to roll over.
But it's not like this is like a terrible thing.
This is, this is, you probably average two or three,
you know, two 5% corrections a year and most years,
it's not like this is the end of the world.
But I feel like the sentiment shifts so much faster these days.
Yeah, yeah, yeah, yeah.
Even like what it was like.
It's social media.
It's social media.
Get used to it.
And maybe that's, maybe that's the point is that
that's where I'm getting my sentiment gauge from.
When there's a five percent pullback,
the crowd will never say no reason to panic.
You know what I mean?
Because the loudest voices rise to the top.
And that's just what it is.
But it's, but the same thing when stocks are rising too.
It's kind of like two months ago, it felt like there's,
this, this is a Teflon market.
Nothing can stop it.
And I, I guess it just, it's always that way,
but it feels more now.
I know you and Josh talked about Michael Berry
last week on what are your thoughts.
Adam Ku had this, this prediction chart,
which I think we can appreciate.
You especially like to do the annotations on a chart.
I like it too.
Just some of his, his, I forgot about the one,
the bubble in index funds in ETFs in September 2019,
which I actually wrote a big piece about saying
that that's overblown.
And I will always kind of say that.
My whole point here, Spencer Jakob at,
what is it?
Jacob.
Spencer, Jacob.
Yeah.
Did I do that?
Okay, sorry.
Well, that's like, that's like Sparring Jazz G-E-O-F.
Right?
Yeah.
Yeah.
I mean, what is that?
What is it G-E-O?
I mean, I hate mail mail from Jeff.
His whole point of this, this calling corrections,
he says every market crash or bottom has a BAPS.
And remember Roger Bapson was the guy called the 1929 crash.
Someone who can dine out forever on nailing it.
In 1987, it was Elaine Garza Reilly
who predicted a collapse days before the Black Monday.
She became the best based strategist on Wall Street
for a while and went on to run some poorly performing
mutual funds in 1982.
It was Elliott Wave theorist Robert Prector predicting
a roaring bull market after stocks spent 16 years
in the doldrums.
That Elliott Wave stuff still around, isn't it?
But the crash you see called never materialized.
And it said, I love this part.
In response to email questions,
Garza Reilly says her claims on her website
of 94.5% correct calls have been audited.
And while Prector was more humble,
emitting criticisms of his record are about right.
Good for you.
Which is kind of funny.
At least he's admitting it.
My whole thing is, remember the Buffett punch card
of like, you should have a punch card
in 20 times in your career.
You punch it and you make a change.
There should be like a punch card
of like five big predictions or the crash predictions.
And after your punch card is done,
you can't, you can't public and make them anymore.
I just, I'm a fan of having the public track records out
for people who make this kind of stuff.
That's what I'm saying.
And I think that's a good part about the internet,
even though some people fail to do their own research
on this of the person, the boy regret wolf kind of thing.
Yeah.
I don't know.
Ben, do you remember when like, weed stocks hit the scene?
Yeah, what's the till rate was the one?
Was that the big one?
TLRY, I think so.
Is it almost the case that weed going,
being legal was bad for potsocks?
Is that possible?
Yes, too much to play.
Oh my God, I'm looking at like,
Toke, for example.
This is a Cambria fund.
And that actually does this good thing where it's like,
if an asset class is down, I don't know if weeders
is an asset class, but you get the point.
Maybe sector, whatever it was.
He had this great study.
If something's down five years in a row,
almost doesn't matter what it is.
You just buy, you know, like.
Oh my gosh.
How is this even possible?
It's down.
So Toke is down.
What, is that what?
Oh no, so I'm looking at till array is down
every single year since 2018.
It was up 292% in 2017 and 310% in 2016.
And it's fallen every single year since then,
including this year.
I don't know, it was up in 2020, sorry.
I remember when these stocks came out
and I had like, I had one family member
who was like, not bugging me,
but you know, really curious about which one he should buy.
And I was like, I think I said, like, listen,
I don't know if these would be great business.
I told them about like the airline thing from Buffett.
I don't know if that fell in deaf years,
but I don't know that these year to be any,
that this may any winters here.
It's great for the consumer, I guess.
Not I guess, it's great for the consumer,
but in terms of investing.
Anyway, Jeff and Patak tweeted,
it's not every day you see a strategy
go almost all the way to zero unless in two years.
But this cannabis ETF, which is slated for liquidation,
has nearly done it.
It's down 90% since it's October.
Totally cow.
Reception, leverage in weed stocks, bad combo.
So there's a leverage weed stock play.
Anyway, talk, I mean, yeah,
it's still basically in the basement.
I don't know, stop going down.
I don't know, and you'd think weed investors
would have a little more patience
because they're a little more slow to react to things.
Right? Sorry.
So anyway, just getting back to the flows for bonds
from Daily Trooper.
U.S. bonds attracted $1.7 billion
on the weekend ending August 16th
for the 33rd straight week of inflows.
So people are buying stocks.
I mean, people are buying bonds, excuse me.
And then next one, again, from Daily Trooper,
neutral money market funds have dominated
your dated flows across asset class.
So this is wild.
It's money market funds, all bonds, U.S. government,
and then everything else rounds to zero
when looking against that scale
because money market funds have brought in a trillion dollars.
Now money market funds obviously can't move markets
because that's set by the Fed.
But even bond buying is not gonna,
the bond market is so gigantic.
It can't possibly influence interest rates.
What's the financial stock play here
besides a trellis Schwab that would benefit from this?
Because those money market funds make pretty decent fees.
Those are higher fees than an ETF.
Someone has to be benefiting from this.
Is there just every broker is benefiting from this?
In some way, plus they're earning a great spread.
They're all charging 8% on their margin right now,
even though they're paying 5%.
Yeah, what do we say?
What do we say, Rob? And it was getting?
So this whole thing that,
and I think we've done this bit,
so forgive me if I'm repeating myself,
this whole thing about bonds won't lend.
I mean, banks won't lend
when the curve is flatter inverted
because they borrow short and then long, not really true.
Sorry.
They're earning a great spread right now.
It just depends on the demand for loans.
Look at your checking and savings accounts.
They're not borrowing, I mean, yes, they're borrowing short,
but not it rates up by the government.
They're still paying zero effectively or close to it.
Isn't it also crazy how,
like this is like the immaculate handoff for baby boomers?
Like they had this wonderful,
I mean, retirees have been complaining for years
about the fact that they have no safe yield anywhere,
but the stock market went up a ton,
housing prices went up a ton,
and now all of a sudden it's like,
all these baby boomers were retiring and it's like,
here, on the silver platter,
here's this 5% yield for your safe assets, have at it.
I don't think the baby boomers,
you couldn't have drawn up a better situation
scenario for the baby boomers from like 1980 to today
in terms of how financial markets worked out for them.
Low starting yields, high starting rates,
20 year bear mark or bull market,
sure there was a lost decade in there,
but then a 15 year bull market
and now really high rates,
like you couldn't have scripted it any better for them.
See, I really wanted to interrupt there,
but as a co-host, I had to let you cook.
Thank you.
You're welcome.
So I'm actually working on a post about this right now.
If you are an investor,
or if you're a lender, right, slash investor,
these higher rates are the best things since sliced bread.
If you're a borrower,
this is the worst thing ever.
So Ben, is the Fed worsening inequality
by raising interest rates?
But I thought, but wait a minute,
I thought the Fed was worsening inequality
when they were lowering interest rates.
So which is it?
It's both ways, I guess.
But, yeah.
So interest rates are bad for inequality,
whether they're higher or lower, they're just bad.
And I'm being facetious,
but is there some truth in that?
I mean, you can't make the argument.
Certainly, the argument was made the entire time
that it rates when rates were low
that the Fed was widening the income inequality gap
or the inequality gap.
And all can you sigh with rates high now
is not the same thing playing out.
If you already have assets,
you're already locked into mortgage,
you have money to invest.
This is a huge windfall for you.
But if you are borrowing or you are accumulating
or you have credit card debt,
you're getting destroyed.
There's going to be a line in the sand
in like 2021 or 2022 in the future.
They're going to look back and go,
what happened?
It's like housing market, especially.
Speaking of that, I was looking at,
I was playing around with rocket money yesterday.
And I saw, I've got many bones to pick
with my recurring charges.
Bones to pick all over the place.
A graveyard of bones.
With how they are being categorized or what?
No, no, no.
Like, hand up this on me.
So I'm out.
I have three serious subscriptions.
I'm going to call them this afternoon
and find out what's going on.
The New York Times is charging.
New York Times is charging me twice.
It's charging my business account and my credit card.
My personal credit card, I can't figure out why.
I have no idea why.
Anyway, I saw an interest charge from American Express.
And credit card interest is like 20 something percent.
I'm like, wait, what the heck is this?
I'm an auto pay guy, right?
But my new, my new-ish card,
which I linked my old account, my existing account,
I never, I guess I forgot to set up the auto pay.
So I just assumed that, I just assumed, right?
Shame on me.
I just assumed that it was set up.
But I never got a notice that I didn't,
I never got an email saying that I had a late charge.
Isn't that weird?
So I had a late fee for $30 that I called the American Express.
They take it off.
They reversed it.
But the interest expense, the interest expense
are like, that's, you know, that's corporate or whatever.
$106.
And that was probably, I was probably,
I'm probably like, I don't know, 10 days to link with.
Can you imagine the people that carry balances over every month
and are looking at those charges?
Maybe they just don't look.
But I can't even imagine, let it all out.
No, it's back breaking, it's back breaking.
Ben, what's your number one rule in personal finance?
Pay for credit card debt.
Boom.
Always, every month.
Just live off the rewards.
All right, the GDP now has estimates for real GDP
at Q3 at 5.8%.
This is crazy to me.
It's the fastest, non-pendemic quarter in 20 years.
Like, so you had the big snapback of the pandemic,
but take that out of the equation.
And it's 20 years would be the fastest,
quarterly growth that we've had.
Which is, it really is amazing.
I don't know anyone who, in the right mind, predicted this.
It's impossible.
Connor sent it.
So I think that's why the narrative is shifting.
It's like, holy cow.
The economy really is accelerating.
So they're not going to cut rates.
It's going to stay higher for longer.
And okay, you reprice for scassets.
Makes sense.
Connor sent had this.
All of these are reasonable takes.
Inflation is still too high.
Fast growth is compatible with cooling inflation
due to supply chain improvement.
Growth is still too fast to be consistent
with 2% inflation.
Over time, the economy can't handle 5% Fed funds rate.
This all makes sense to me.
Like, there's so many different-
The last one to me is the most salient point.
There's no way.
There's no way.
So, remember, we said so much of the debt is already fixed.
Your mortgage is whatever.
I know this is like fantasy world,
but imagine you repriced everything at 5%.
Imagine you just wiped the state clean
and just said, replace your existing debt
with current rates, sunk.
And maybe this is the reason that everyone on a Wall Street
is so worried is because the thinking is,
if the economy continues to accelerate,
the Fed is going to have to accelerate again.
And that is when something eventually,
it's going to break.
Like, okay, it hasn't broken yet.
We had all these extended circumstances.
Things have been fine.
People lock in low debt.
Eventually, something's going to have to slow on it.
I think that's obviously the worry.
Don't can say I need a financial advisor.
I don't think financial advisor is responsible
for irresponsible subscriptions.
That should be, well, yeah,
I told you got to negotiate with them.
But I think, you know how you have automatic 401k
target date contributions and these things
and like the default choice for credit cards
or default should be automatically paid off every month.
And if you want to take that off,
you have to go ahead and turn it off.
How's that?
That's such a great point.
You know, that's like auto enrollment for 401k's.
Yeah, that's what I mean.
Yeah, it should be.
How much money, how much out, not opt in?
How much money do credit card companies make
because people don't get automatically opted in?
That will never change.
But you're right.
My sister, her very first credit card at a college,
she didn't really know what credit cards worked.
And so my dad looked at her bill after like 12 months
and was like, Sarah, what are you doing?
And she's like, what do you mean?
He's like, why aren't you paying off your credit card
every month?
And she's like, I don't need to.
It's a credit card.
You could just kind of let it go.
And she had no idea interest was accumulating.
And she had the money to pay it off.
I bet that's just didn't.
A lot of people probably don't know about credit card interest.
That's not me for being a finance brother
not teaching her the way.
Hand up.
This is a great chart from Bank of America.
US consumers are still super healthy.
Consumer debt as a percentage of GDP
is at 2001 levels, wild.
So even with all these rate hikes,
it doesn't matter because people already locked it in.
You locked it in.
It doesn't matter, you don't feel it.
Doesn't this go to our point of, okay,
the Fed takes rates to six or six and a half percent
if they have to really like snuff this thing out.
And we have some sort of slow down.
I still fall in like, even if it happens,
it's going to be, it's going to be pretty mild.
So a recession would happen, but it would be mild.
I think that would be, that would have to be your baseline.
With the caveat that things can always get worse,
but that would have to be the baseline.
Things aren't like, people aren't just over leveraged
to the hilt this time around.
To the hilt.
Right? Is that a thing?
Is it to the hilt?
You might be right, I'm not sure.
To the hilt.
It didn't sound terribly harmless to the hilt.
All right, to the hilt, I'm going to fact check you.
To the hilt.
To the hilt is a thing.
To the hilt is much as possible.
See we're mortgage to the hilt.
It's the utmost degree.
Okay, Ben, not only were you right,
but you were exactly right.
Credit to you.
I could hear people saying to the hilt
and with confidence and thinking they're doing it right,
but I know.
So you think to the hilt is one of the six people say,
but they don't know that it's actually to the hilt.
Right.
The more you know, I still get a grain of sand
and salt confused, but now I know it's sand.
No, all right.
Wait, is it salt?
Yes, it's salt, we've done this before.
God, I really thought it was sand.
All right.
Are you sure?
I can't take it with a grain of salt.
Okay, guess that one hasn't suck it yet.
Yeah, confidence level is pretty high there.
All right.
I don't know how to square the circle, Ben.
Worldwide spending on business travel
will top pre-pandemic levels next year.
Well, and expand to more than 1.78 trillion
according to the global, in 2027,
according to the global business travel associations
annual outlook.
How and when business passenger values
will recover to 2019 levels remains to be seen,
traveled by large corporations remain stuck in about 75 to 85%
of 2019 volume for US carriers.
That's way higher than I would have thought.
I would have thought the remote work
would be like 60% of pre-pandemic levels.
But it says spending was 47% last year to 1.03 trillion
and it's forecast increased 32% in 2023.
How much of that is inflation?
Okay.
You haven't even still.
Kind of like looking at the back office rates,
like this is the highest grossing thing ever,
but you don't adjust for inflation.
But I just assumed, I don't know,
that business travel was like dead forever.
Won't you have guessed it's down since 2019?
50%?
I would have said at least like,
why who's traveling for business?
Yeah, that's a part, well.
Well, I guess I've been traveling more, but.
That's true.
What idiots are traveling?
How much of it, how much of it you think is people
like getting excuse to get out in travel
because they just, they want to get out in travel again.
And it's like they don't need to, but they want to.
There's got to be a lot of people who that like fall.
Like I got to go to visit the manufacturing plant
over here and just get out of the house.
The Wall Street Journal had a piece called banks
don't love rich mortgage borrowers as much as they used to
saying like they're not getting deals
to jumbo loans anymore, but this is interesting to me.
So they look at interest on a new car loan by credit score.
And they go deep subprime, which I did not know is a thing.
Deep subprime sounds like a movie from the 90s.
Does it not?
Brendan Frazier probably would have been in it.
Deep subprime is much nicer than very poor.
Subprime, near prime, prime and super prime.
And look at the, look at the range of,
and they're showing that actually the super prime
have risen faster than the deep and subprime.
Look at how much higher these rates were
for having a bad credit score.
This is a way, so we're talking almost 15% for deep subprime
versus 5% for super prime.
You know how they do the FICO score, right?
I think it's, so I looked it's up.
One third is like your payment history.
So you're, you got docked already
because you forgot to make a payment.
So your credit score is going to go down.
The amount owed to the other one.
Wait, is that for real?
Look at it, look at it.
Persuade payments.
One laid payment?
No, it's not, it would have to be a series of them.
A amount owed is a one third.
Length of credit history is like 15%.
So get those credit cards right away and pay them off.
New accounts opened is 10%.
And then types of credit use is 10%.
That's how they determine your FICO score.
So having a good credit score,
would remember you got me the t-shirt, what did it say?
Like, not the brag, I have a great credit score or something.
I did.
You bought me a t-shirt, you had me like a printed t-shirt made.
Feel like you've never seen it, you ever wear it?
A few years ago.
Well, you got me like an Excel.
So I think I use it as a towel.
Which someone pointed out, large is in the middle, right?
You didn't want to be a large
because you thought you were on the upper end?
Oh yeah, somebody had a great take.
They emailed us and said, Michael, small, medium, large,
extra, large, extra, extra, large.
Largest smack day up in the middle.
Don't discount the number of XXL people out there.
It's true.
But I still say large is average.
Which I guess that's what he's making.
Here's an anecdote about how rates are finally starting to impact.
Chrissy Johnson, a marketing manager in Chicago,
has been looking with her family of four for House of the Backyard.
They wanted to put down 20% on a million dollar home
and take out a jumbo loan.
But they could get a rate lower if they put 30% down
and got a conforming mortgage.
And that would be like a more of a government-backed loan.
So they're considering putting the extra cash down.
And she says, depending on where the interest rates are,
we'll dictate what we are doing.
Like, it's certainly changing behaviors for people.
And that sort of thing, like paying down a loan faster
or trying to buy down a higher,
that's the kind of thing that eventually feeds any consumption.
Even if it's on the edges these days,
that slowly but surely that seeps its way into the economy, right?
Don coming in with the knowledge drop on lay payments.
A lay payment can drop your credit score by as much as 180 points.
However, London's typically report
lay payments to the credit bureau
once your 30 days pass to.
So I think I'm in the clear.
So you're not delinquent yet?
Not delinquent.
I'm just going to show up on the next Fed's court.
This blew my face.
We're getting back to the car stuff.
Car dealership guy, remind you that some people
are paying mortgages for fancy cars.
These are real active car leases in five states.
So an Acura NSX, beautiful car.
Not quite a Honda Accord, but still nice.
A 36-month lease, $5,600 a month.
Wait, for an Acura?
An NSX.
What's that?
It's their sports car.
It used to be really nice.
It was around the 90s and they discontinued it and brought it back.
Very sweet looking ride.
I'm not a car guy at all.
Who's bragging about an Acura?
That's all I'm saying.
It's very nice.
If you're going to do it, get a Ferrari or something.
Don't get an Acura.
That's all I'm saying.
Mercedes G63 AMG 5,100.
A Porsche 911 5,100.
A Land Rover, a Range Rover, 4,400.
Oh my God.
I know that these are really rich people,
but would you rather have a Porsche 911
or a vacation home on an ocean or something?
This is like the difference here.
It's unbelievable.
It's so much money.
I'm going to assume that these people,
I'm going to assume they can afford it.
You're not just casually getting a $5,000 car.
And honestly, if you have that much money,
what's literally what's the difference?
But Nappy said it's just a staggering amount of money.
So congrats to the rich people.
That's awesome.
Oh, I had a thought.
That's like, I don't really believe,
but I just wanted to talk it out loud.
My train ticket was, well, that's it.
I don't do monthly's anymore.
Let's see how much a monthly is.
I think my monthly train ticket used to be like $250.
And that's used as many times as you want to get into the city.
Let's just assume that a monthly ticket is $300.
That's not an insignificant amount of money.
And so when prices start...
You used to be enough for a car payment.
When car prices started to go crazy,
I think people were able to rationalize,
at least long island commuters or New York commuters.
Wait, I'm not paying $300 for my train ticket anymore.
So if I'm paying an extra $150 bucks from my car,
it's still, you know, it's still on the black.
I could see that.
So if people are working from home,
they probably also need an auto, it'll be a more too.
Yeah.
So I think that was easy to rationalize.
Yeah.
It is surprising to me if you look at the used car prices
are coming down,
but they're still way, way elevated above 2019 levels.
Another tweet from car dealership guy,
severe delinquency for auto loans.
This is the highest since at least 2006.
Yet the job market is strong,
so basically no one has any idea what's going on.
So this is a percent of asset,
let's ABS asset back securities, auto-based back security,
whatever, something like that.
60 days plus delinquent.
And it's a, it's over 5%,
which is, in fact, the highest it's been since,
at least 2009, at least it's 1060 says.
Not surprising.
Could there be stress in this market
without a broad read through to the economy?
And I'm going to say yes,
just think about how insane car prices were.
Do you think in the next downturn,
whenever we get a recession,
there's going to be like wonderful opportunities
to buy like used cars and used boats from people
that went way over their skis
and spent too much money
and just a fire sale price
like I got to get rid of this stuff.
Is there going to be a possibility?
Yes.
I think so too.
I think there's a lot of people
who probably over stepped
their spending in recent years
and are going to have to cut back and sell stuff.
All right, Jeremy Schwartz has a take.
All right, closing my week, pondering thoughts,
which he was great on compounded friends
last week of their built-chunis.
That's a good one to combo there,
as far as ETF and market knowledge.
Closing my week pondering thoughts
from an AI professor at Wharton
who thinks productivity acceleration from AI
will take 10-year bond yields up to 6%.
Why would productivity gains take bond yields so much higher?
Because growth is going to be so much higher?
I guess so.
Yeah.
Don't you think the hype cycles
happen so much quicker these days too,
where after a while,
the hype cycles happen and this is what we're going to have
and this is what we're going to have.
And then we're going to have this
and that stuff doesn't happen.
It's kind of like,
just kind of, you know,
drumming your fingers and waiting for this stuff
that like, I'm not saying
like the AI stuff is not going to happen,
but it's kind of like the hype cycle digest
this stuff so fast,
like what this is, what's really going to happen
and then you're going to have this
and the technology is going to be so great
and then you have this waiting period
until it actually happens
or for some other stuff like crypto
it actually doesn't happen.
I think we can move faster.
Yeah, we pull forward the hype.
Okay, here's another rates thing.
If you had told me this,
even 12 months ago,
hey, inflation is down to 3% now.
Inflation it fell for 12 months
and our own inflation is three.
What do you think mortgage rates are going to be?
There's not a single scenario I ever said,
oh, mortgage is seven and a half percent.
Right.
That would have broken my brain.
There's no, it makes no sense, right?
Mortgage rates are in all their highs, 7.5%.
The last time the 10 year was this level,
the 10 year in October 27 was 4.5%.
You know, the mortgage rate was then 30 year?
Seven over time.
So the 10 year now is at the same level
as it was in October 2007.
What was the 30 year mortgage rate back then?
Five and six eighths.
Well, it was six and a quarter.
Okay.
For using your mortgage terms.
But so the spreads are still so much higher today,
which again, I think the Fed kind of broke
the mortgage market when they buttled mortgage back bonds.
Now that's the function of the Fed, right?
Buying less bonds and that used to it.
That's why spreads are wider.
I think that's part of it.
And again, the fact that you're not getting any
prepayments because people aren't refinancing now.
So it's, I don't think the Fed ever thought through
raising rates as fast as they did
what the unintended consequences would be.
Now they could, they could easily bring that spread down
if they wanted to, apparently they don't,
they don't want to, but just the 7.5% mortgage rates
with three to two inflation.
It's too high.
It's way too high.
And yeah, I don't know how the housing market doesn't,
we talked a couple of months ago, like is the correction over?
Like if this, if this stays higher for longer,
like housing prices have to fall again.
They have to.
I know people keep saying, well, it's easy to see
because it's applying demand and that was, like no one,
I'm sorry, eventually this has to impact
the housing price market.
It has to, right?
Maybe nothing has to happen, but I don't know.
Well, there was, there was an article, I mean, yeah, listen,
it's hard to make the argument that it wouldn't, right?
Like I don't want to say that it's not going to impact
the housing market, but there was an article in Forbes showing
that like 40% of buyers get help from a family member.
I had that in here.
For the down payment.
38% of recent home buyers under the age of 30 use,
a cash gift from a family member or inheritance
to afford their down payment.
I talked about inheritances as the compound recently.
And this is the time where if I was a young person,
I'd be hitting up mom and dad and being like, listen,
I don't want it when I'm 50 or 60.
Help me now with a down payment.
I, and I'm sure a lot of parents are receptive
if you have the means.
Yes, you'd have to be a couple of interesting facts
that show like if housing prices fall, you know,
there's plenty of cushion, bank of America,
2.1% of mortgage properties have negative equity,
which is lower, it's down from 25% in 2011,
which is a crazy high number.
Only 0.88% of home equity is being used in Helox currently.
The lowest level since 1988.
It peaked at almost 7% a few years ago.
So there's plenty of room to maneuver here
for people who own houses already.
Yeah.
Michael McDonough made this great chart
on monthly mortgage payment using the median
existing home price.
Assume that you put down 20%.
This was $577 at its low in 2011.
In 2019 or so, I'm just eyeballing this.
It looks like it eclipse $1,000.
Again, this is a monthly mortgage payment.
Now it's $2,300.
He also broke down your first payment.
How much goes to principal?
How much goes to interest?
And look at how much more goes to interest now than principal.
This is why if you buy a home right now
and hopes of flipping it in a couple of years,
it's like a starter home, you're going to build zero equity
if prices don't go any more
because the majority of your money
is going to interest payments now.
Right, so yeah, that's a great point.
So a pre-pandemic, it was like $1,000.
It's $2,300 now.
What?
Yeah, that is insane.
Okay, we got a ton of emails.
Oh, dammit, I meant to throw some charts in here.
Oh, well, we got a ton of emails.
I'm not sure why this triggered such a response,
but the KFC versus Taco Bell pizza hut thing,
KFC is massive for whatever reason, massive.
It's the largest food, fast food chain in China.
Yeah, it sounds like Asia has a really big KFC presence.
I don't know.
I guess it may be just because it's so different, right?
Then most of the food they have there, that surprises me.
Someone says somehow the kernel took over China
better than Mickey D's did.
All right, great quarter, guys.
This is a great chart from the AlphaSense,
on who FTAV is, I'm sorry.
Who's FTAV?
Anyway, nearly here and over there.
The company call transcripts containing the phrase double click.
That's, this is a bubble.
Wait, what am I missing here?
What does double click mean?
Let's let me double click on that.
Oh, geez.
So if you did this for podcasts,
it would be let's unpack this a little bit.
Yeah.
That would be the podcast version of this chart.
Now, you know, Josh actually said double click last week.
I almost said something, but I didn't want to interrupt the flow.
Okay, interesting.
I didn't know that was even a phrase.
Oh, really?
Do you not, do you even conference call?
I mean, I don't, I guess I must miss.
I don't, I've never used that phrase in my life.
Let's double click on this.
That sounds like a very AOL 1990s thing to say.
No, obviously you're not going to use it in your life.
I mean, you're not going to tell your wife.
Let's double click on this.
That'd be very weird.
Try it to see what happens.
All right, call a container, tweet it from Macy's.
We experienced an increase rate of delinquencies,
the speed at which the increase occurred for us
in the broader credit card industry,
since our first quarter earnings call was fast on the plan.
We were working closely with our bank or bank partner city,
whatever, to mitigate rising bad debts.
Okay.
If you just read that, and you took them
out of faith value, you'd say, whoa, uh-oh, uh-oh.
We in trouble here, we in trouble here.
Or maybe Macy's just stinks.
I think their same store sales were down.
People are going to be blowing up their credit card scores
or their credit scores.
8% year over year, something like that.
So, Jeff Mackie had a great thread.
Macy's is hard to take seriously.
Hikes shrink allowance after physical count,
which raises a lot of questions.
Looking for a down seven percent comms
takes credit card delinquencies up.
This is what garbage retail accountant looks like.
Anyway, it's a whole thread on it.
So, glad that we have people like that,
setting the record straight in some shenanigans.
You're a bad company.
Don't play macro.
Don't play micro.
Have you ever been to a department store in recent years?
Yes.
A depressing place that can't believe that we ever had to shop
like that before the internet.
The last time I was in a department store, I called you.
I just, I don't know why.
I get like anxiety shopping, much or why?
It's so much easier to shop online these days.
When I was younger, this is another like walking up the hill,
both ways the school kind of thing for me,
as a middle-aged person.
Before school would start,
my mom would take me to Macy's or it was called
Marshall's or whatever back in the day.
And by all my clothes.
Macy's was not called Marshall's.
That's a separate store.
Marshall Fields.
Oh.
The original was Marshall Fields.
So, you know that if you're a Midwest guy, yeah.
So, now I shop on Instagram.
By the way, what's this, what's this brand called?
Is this homage, homage, homage, homage?
There's so many ways to say it, homage?
Yes.
This is where I shop.
You were up to the hills in Instagram shirts.
I am out to the hilt.
I was speaking on Instagram the other day,
oh, we were talking about like,
oh, Alexa.
Here's what I use Alexa for.
Alexa set a timer for 10 minutes.
When I'm cooking the kids white mac and cheese,
that's what I used it for.
That is not bad.
Or Alexa play whatever.
See, she's talking right now.
I guess she's not connected to the internet.
See, I don't mean use it upstairs.
Here's where voice,
and I was talking about how Amazon burned billions of dollars
on voice.
Here's where voice excels.
For the companies.
For the companies.
Cause they will send it on you.
Dude, I used to think that was nonsense.
Like, oh, like 90% of the time,
and I do still believe it's like 90% of the time
when people think that they're being spied on,
they just don't remember that like either they search
for something or their spouse search for something
and it's on their record.
But we've got, we had like a fruit fly infestation
out of nowhere.
They just came hard and heavy.
And I saw an ad pop up my Instagram.
And as I was talking my neighbor about it,
and then I came back and said, I'm scrolling through.
I'm like, what the, what?
So I asked Rob and he said, hey, did you buy any fruit fly
to the tournament?
Did he search?
She's like, no, why?
So I told her, anyway, listen, I bought it and it works.
So thank you for spying on me.
But nevertheless, how would you explain that?
The funny thing is, I don't even get mad about it anymore.
It's like, eh, whatever.
This is the price of the day.
No, I didn't, they're listening.
Okay.
Maybe they hear some embarrassing things,
but thank you for serving up that fruit fly thing.
Or I guess an alternate explanation
that is probably more reasonable
is other people in my neighborhood
are experiencing the same thing
and are buying fruit fly stuff
so they served it up like on a local thing.
Maybe Alexa detected the fruit flies in her house for you.
You didn't use your electric zapper on them?
The bug zapper?
Oh, I've been zapping to high smithereens,
but there's too many.
The noise is so, the noise is so, yeah, it's a great deal.
All right, let's get rid of this.
What's this, oh, this credit card thing?
Okay, I got a credit card thing in the mail
from city to the day.
It's like city simplicity card.
0% intro APR for 18 months, 21% after that.
But 18 months on balance transfers to
or purchases for me,
how are these credit cards able to still
roll out 0% credit cards?
I looked, there's no other.
So my finance brain says,
why wouldn't I put every single one of my purchases
on this credit card and just put all the cash
into five or six percent tea bills for 18 months?
And that's way higher than I could get
from my credit card reward.
Feel like there's gotta be some fine print in here
that you missed.
18 months, 0% intro.
I mean, I don't know what they,
maybe they would give you a low limit on it or something,
but that's like, oh, yeah, yeah, you know,
that's probably what it is.
Yeah, you probably have a thousand dollar limit.
And I mean, there's no other,
there's no other rewards you get with it,
but like in a high rate environment,
that 0% credit card, like if you're thinking about
doing a renovation or something,
why wouldn't you use this kind of thing
for a while at least before tapping in your home equity
or whatever it's, whatever you're thinking, right?
That, well, because I'm saying
the cap is probably a thousand bucks.
Okay, maybe it has to be it.
That's the only thing I think of.
Ben, I saw a chart from Fidelity.
Whoa, whoa, whoa, you can't post demographic charts.
Sorry.
Well, I wanted to serve this up to be a good co-host
and see if you get any thoughts.
Okay.
The percentage of population older than 55,
it's 27% in the United States,
30% in Canada, 36% in Germany, 39% in Japan,
expected to rise.
A lot of people keep talking about this,
like it's going to be the end of the world economically speaking
and these places are in trouble.
My default is we'll figure it out.
Well, guess what?
What about when 60 is the new 40?
That's true.
People are living longer.
I think that, and obviously the baby boomer population
is a big part of it, but.
I don't put it a lot of credence in here, as you know.
We got an email from a listener in response
to Ben's post about not needing as much as you might think
in retirement.
Basically, people who have a lot of money
don't end up spending it all.
They rarely do or come close to it.
So I did a file piece on this,
but the big takeaway that was pretty eye opening is like,
listen, I'm almost 60 years old.
Everything that I wanted to do with money
for the most part, I've done.
Been there done that.
I took trips, I had a nice car,
I bought a nice watch, whatever.
That stuff doesn't move the emotional needle.
At 60, the same way it does when you're say 40.
And so I think people severely underestimate it.
Now it's a balancing act.
But I think in large part, this is why people just
don't spend the way that they do when they're 70, 80.
I don't know, it sounds obvious to me,
but maybe it's not obvious.
Your conclusion of so spend some more on your young
and you can enjoy it or want to enjoy it,
because I agree when you get to that age
and you're kind of setting your ways,
you probably, there's certain things
you just don't want to spend money on anymore.
And I actually heard from one frugal millionaire
one time who told me like, he built a huge nest egg
and he couldn't spend it and he didn't want to.
And he's giving some away, but he said,
I gave myself certain rules.
Like if I'm traveling, I'm always going to pay for first class.
He's like, I cut back on so many of the things,
but if I'm traveling, I'm going to,
so I think find little conveniences like that
to treat yourself on, I think helps.
But there was another one who said,
this guy, he emailed us, he said he has a $4 million net worth.
He says, he's so many things about how much money
you'll need in retirement.
I have no idea how to answer the question I don't expect to.
So we keep saving and saving because digesting what life
will be like without kids' expenses,
limited to no mortgage and lots of free time.
So I just want and need more,
if that results in my kids inheriting a lot of money,
so be it, I just think the retirement discussion
has so many variables people don't like to admit
they don't have a clue about
and that's where a lot of the concern around money comes from.
So I think part of it is just,
there's so many unknowns out there
and people just want the safety net.
And they get rid of this thing.
That's a personality thing, I totally get that.
But once you get to a certain age,
you're like, I'm not going to spend that much money
if I just leave it to my grandkids.
True. And that's fine.
If you want to give it away to charity
or give it to your grandkids or whatever,
but I think you should also enjoy yourself a little.
I think it's okay if you've spent your whole life working
and slaving away and saving money over time,
like find little ways to treat yourself.
Don't you think I'm at least speaking for myself?
I am at the age where I think I am,
this is like peak money enjoyment for me.
Yes.
Where I'm able to do things with money
that I wasn't when I was younger,
that at some point will not be special
because that's how human beings work, right?
The things that were once a luxury become normal
or just the excitement wears off.
So I think I'm peaking right now.
And hopefully my peak lasts many years,
but I know it won't always be this way.
That's also why I've been okay to pull forwards
and expenses that with my kids now
is why I can enjoy this stuff with them now
because I know in the future,
they're going to be too busy
or not want to hang out with me and my wife.
And you're going to be older and real year.
So I'm okay pulling forwards on those expenses
and not thinking through like,
oh, if I would have just saved this money,
what would it be worth in 30 years?
That's why being a parent has led me
to pull forward a lot of that stuff.
One more feedback thing.
We got a lot of feedback on dishwashers too.
Regarding dishwashers.
It's a great email.
Do work without rinsing,
but you can't use pods.
I highly encourage watching this video,
the host breaks down a dish washer,
so inside it works.
TLDR, dishwashers have a pre-wash mode before the wash
and when using a pod,
there isn't soap for the pre-wash.
You need soap and a medication.
Wait, there's a wash before the wash.
Pre-wash.
So you need like the dish detergent.
He says use powder detergent
and the dishwasher works amazingly well.
So those pods are maybe it makes your life easier,
but they don't work as good.
So it drives me nuts.
When Robin will put like something with sauce
in the sink and she just refuses to rinse.
The money, how many times I'd say just please rinse
because of the morning, I'm like scraping it off, you know?
Like the pods leave like half the pods still in the thing.
When it's done.
I have a pretty high hit rate,
but I think I'm willing to go the extra mile
and do this pre-wrench or whatever
because it's annoying.
I'd rather listen,
if I don't know when this is, this is fantastic.
But in the past you would pour the powder in
and now it's the pod.
So I maybe you got to go back to the pour stuff.
Yeah.
I'll try it out.
I'll try it out.
All right, recommendations.
Ben, what do you got?
All right, we watched the whale on Paramount Plus
because there's just like nothing else to watch right now.
And I think we're going to be in like a bear market
for content for a while.
But there's everything to watch.
Don't we just talk about this?
Yes, but I'm saying new stuff.
Have you?
All right, go ahead.
So we watched the whale of Brennan Frazier
and this, this is a Darren Arnobsky movie.
And so this is a film and not a movie.
This is the kind of movie they make
because they want someone to get an Oscar.
Like in his performance was great,
but I didn't say anything to the whole movie
and my wife at the end goes, I know you didn't like it.
And I said, I don't think she liked it more than me.
And I said, what do you, how do you, why do you say that?
She said, you don't like sad movies.
And this was a sad movie.
And it's the kind of movie that is depressing
and it gets more depressing.
And another sad thing happens and it's kind of like, come on.
Seriously.
I love sad movies.
Really?
Yeah.
I'm a big emotion guy.
And I like this movie a lot.
You liked the whale.
I did.
When did you watch it?
On an airplane.
You like, okay, I just, I can't wrap my header.
It was well done movie.
I just, not for me.
I'm surprised.
I was gonna say you should not watch this.
No, I liked it.
Okay, your movie taste is just,
it's like a roll of the dice for me.
Like I can't ever tell something.
Something you're like.
You know what I mean?
I spent the last week watching
and like four times when I was like, are you,
you really doing this?
I went down the garbage fish rabbit hole.
I was talking about, they were talking about the podcast.
So I watched like,
I didn't watch Open Water or 47 meters.
But I watched 47 meters, the un, un, uncaged by accident.
This is a sequel.
I thought I was watching the original, I watched the sequel.
I watched The Reef.
I watched the one with Blake Lively.
The Blake Lively one was not bad.
What was that called?
Reef, they're all, I don't know, they're all blended together.
That was a good one.
Okay, I've never heard of any of these movies,
but the shallows.
Okay, yeah, that was it.
Yeah.
I can't believe you liked the whale.
I did like the whale.
Although I don't, I feel like I don't love
Darren Aaron Afske movies.
What else did he do?
I didn't like the black swan one.
Yeah, I liked that one.
Oh, see, it's that's films.
Yeah, he's a film guy.
Oh, the wrestler, great movie.
Reckon for a dream.
Mother, I did not watch.
I have no interest in that.
I didn't like pie.
How about that?
I actually never saw that one.
All right, what do you got?
I watched two things on top of all the fish movies.
The Johnny Man's Aldoc was pretty good.
I mean, it was quick, but, and he had a quote there
that I believe very strongly is true.
He said, when I got everything that I wanted,
it was the most empty I felt inside.
And I know people were refused to believe this,
but this seems to be like a common thing.
If you are very driven for money, fame, whatever,
whatever your purposes that you're obsessed with,
once you get it, like the chase is the fun part.
Yeah.
And then once you get what you wanted,
not everything that you expected, it's like,
it's like a massive, massive psychological blow.
I know you're not a big college sports guy,
but he was an amazing college quarterback.
And I'm not surprised he was a bus in the NFL.
I don't know why I watched this one,
but I watched the Johnny Depp and her doc.
What's that on?
Netflix.
Okay.
I was saying this to Josh.
You know what's incredible about Netflix?
You don't, the shows that are top 10, they just pop up.
I'm not like, you don't like see advertisements.
There's no marketing.
The advertising is on the platform itself.
That's it.
It's genius.
They advertise on the platform.
And it works.
So I watched it.
They should probably add more top 10 lists.
Like they have the top 10 movies and TV shows.
But if they added more top 10 lists,
it would drive more, if they could drive more stuff
if they wanted, I feel like.
So the biggest takeaway for me from watching that
is just have vile social medias.
And there's a strong opinion.
Basically everyone took Johnny Depp's side
because he's famous, I guess, and other factors.
She's amazing because he's not a great guy.
Not all accounts.
No, she, and you know, she, there are parts
where she admittedly did not come across well.
But it was so one-sided, so so one-sided.
And the social media, like, just people
spending their entire lives following this
and making money off the edges,
like really gross to watch.
And that's great.
You remember my, in my don't fall for it,
I wrote about Hunter S. Thompson and Johnny Depp
and how Johnny Depp blew through all his money
and he was spending $3 million a month on wine.
Wow.
Pretty good.
Not bad.
Guy likes to party.
Okay.
See, he would drive the actor NSX.
AnimalStreetsPod.gm.com.
We'll see you next time.