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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.
Michael Batnik and Ben Carlson work for RIT Holds Wealth Management.
All opinions expressed by Michael and Ben or any podcast guests
are solely their own opinions
and do not reflect the opinion of RIT Holds Wealth Management.
This podcast is for informational purposes only
and should not be relied upon for investment decisions.
Clients of RIT Holds Wealth Management may maintain positions
in the securities discussed in this podcast.
Welcome to Animal Spirits with Michael and Ben.
I went into my closet yesterday
to look for a button up shirt.
Is it button up or button down?
Are they synonymous?
Button down.
You go both ways.
Button down.
I've heard it referred to as button down.
I think it's because you start from the top.
Does anyone ever start with a bottom button
when they're buttoning their shirt?
No, you start from the top.
Yeah, that's true.
All right, button down.
There you go.
I've got a meeting today that I needed to be dressed for
and I went to my closet and I said, hey, wait a minute.
I had none of these, not that I have so many,
but I couldn't find anything.
Like, wait, oh, that's right.
I think I went to the laundromat
and dropped a shirt off a couple of months ago.
So I went to the laundromat and gave them my phone number
and they said, don't have anything.
I said, yeah, it was a couple of months ago.
And it's like, is there like an old pile or something?
So she goes, hold on.
Let me check.
Like, Lawson found.
So she brings back my stuff.
And these are the dates of the drop off.
I've got one from December, 2022.
That's not even that long ago.
For dry clean? Yes, it is.
You left your dry cleaning for five months?
Oh, yes.
I got one from February, 2022.
Wow.
What did they say?
Do they throw them away?
Like I say, left.
I own three of these shirts.
Like I own three button down shirts
and they were all at the dry cleaner.
So did you get a back or not?
I got them, but what do you mean?
Look at this. Where are you?
Okay.
I can tell you the last time I bought one of those kind of shirts.
One of the things I did in the pandemic was
I gave up on ties forever.
I don't care if it's a wedding, a funeral, whatever.
You've never worn a tie.
I've never seen you in a tie.
Yeah, I'm done.
Occasionally we're a tie.
I'm done wearing ties.
I've just decided.
Funeral.
A funeral is the last place I'll wear a tie.
Couldn't you just go sport coat, slacks, shirt, no tie?
I respect the dead, apparently you don't.
You know what I'm wearing underneath though.
I don't know if you can say.
You can't say.
I'm wearing khaki bird dogs.
You have a bird dogs below and yeah,
your party down low and business up top.
Looks great.
Thank you.
From the Wall Street Journal,
they talked about the Fed Pause.
Okay, this is from Goldman Sachs.
Going back to 1982, the S&P 500 returned
average of 19% in the 12 months
after the Fed funds rate peaked according to Goldman Sachs.
Goldman studied six Fed tightings cycles over that time.
Stocks rose after all, but one of them.
Which was the one where it didn't.
That's a good question.
I don't know.
Probably 2007, because didn't they raise rates
into the Great Financial Crisis?
I'm guessing that was it.
But I like stats like this just in terms of context,
but I feel like this is a throw it
out the window situation.
Don't you, where the market is so much better
at sniffing these things out ahead of time
and moving quicker and maybe not reacting the same way,
especially this cycle, where I would say,
not saying it's not going to work,
but just saying that banking on this type of thing
in this environment, I don't think you could do it anymore.
Just anything?
For this kind of thing, don't you think that the markets
just move so much faster these days with this stuff?
And if that was going to be the case,
hasn't the market already kind of moved ahead of it?
Back in the day, the Fed never talked about
what their approach was going to be.
They never said anything.
Now the Fed is telegraphing everything they're doing.
And so I feel like getting ahead of this stuff
is a lot easier than it was back in the day.
Yeah, that's a good point.
I think also this data wasn't available back then.
It's not like people knew how equities would react
to a pausing cycle.
No one talked about it.
But I think that once they do pause, it's intuitive.
It's because they've already done the damage
and stocks got killed.
This is why it's so difficult to use a back test
as set in stone because you're right.
Back in the day, people didn't have all of these tools
and data at their fingertips.
I think we learned the stock market itself,
the data that CRISP stuff was put together like the 1960s,
where people didn't really know what the long term returns
for stocks were.
They were just kind of guessing,
like gas stocks for the long when I get,
like that wasn't even a thing for people back then.
So I think that changes how the markets react to things.
That's all I'm saying.
Do you think most people at this point
understand the limitations of a back test?
I think that's been established.
Probably not.
Really?
Normal investors, I feel like if you see a back test tool
for the first time in your life and you put something in
and you feel like you have it figured out,
you look at that and you go,
I'm putting all my money in this.
I'm gonna pick like, you don't think so?
No, and what's a regular investor?
What's a regular investor?
Who are you talking to?
Our audience are not regular investors.
We've got some smart people out there.
We have a sophisticated audience.
They know better.
All right.
I do think that if you're a novice investor
who's just getting started
and you see a back test tool for the first time
and you run it, you probably go,
I've got it all figured out.
I'll just put all my money in this.
novice investors, listen, I'm gonna know,
I'm pushing back hard.
novice investors don't back test.
I'm saying the first time that you get into it,
I did this early in my career
I got this back testing tool.
It was called like Portfolio 123.
And I don't know, someone bought them,
but you use it.
But how about this?
You can create these amazing strategies
with these awesome like sharp ratios.
When you and I first discovered
the ability to back test stuff,
yeah, we probably gave those back tests
a lot of credence, but that was a long time ago.
I'm saying investors today
probably no better than we did.
I think you're giving people too much credit.
Agreeded this degree.
A little bit of this, a little bit of that.
We're arguing with each other here
because maybe my earlier point of their being more knowledge,
maybe you're right, maybe people do know it.
I just think it's easy to get caught up in that
when you try it for the first time
without some experience of letting a back test
live in the real world.
I don't know, I just, I vaguely remember somebody
in this podcast saying that investors have gotten smarter.
Maybe I'm misremembering that.
Maybe they're smarter because they don't use back test anymore.
Maybe that's it, I don't know.
But I want to talk to you about interest rates
because they had come down quite a bit,
especially we were like sort of scratching our chin
when the Fed raised rates in March.
The Fed raised rates to 475, 500,
the two-year drop below 4%.
Remember that?
They're coming back up and I wonder if it's
because people are saying,
you know what, rates are gonna stay higher for longer
or maybe the economy is actually doing okay.
Have you looked at interest rates by the way?
Is this news to you?
A little, I mean, they're all over the place
but three month T-bills are now at 5.1%,
which is a ridiculously good deal.
And I've been having a lot of conversations
as have we internally about, obviously,
T-bills is the layup right now
in terms of fixative exposure.
Why take more risk?
Unless you really are pounding the table
for a recession.
Why would you ever accept a 3.5% 10-year yield
when you can get 5.1% in three month T-bills?
The con or that would be, well, T-bills yield,
you can't lock those in, they're short term,
they could drop.
There's reinvestment risk and then there's also,
if rates do drop, you're not gonna eat any juice
and then you're gonna have to reinvest at lower rates.
But do you think that bond investors care about juice?
What's a bond investor?
That's like saying a stock investor.
People have different objectives.
Yeah, but if you're not a hedge fund investor
who's trying to gauge the macro
and guess where you should be on the curve,
if you're just a fixed income investor who says,
I want to diversify my stock holdings
and I don't want this part of my portfolio to get killed,
why would you be in anything other than
three to six month T-bills right now?
For stability and income.
If you think a recession is coming,
your stocks are gonna get killed
and you're not gonna get anything out of your bonds,
that's why.
You're gonna get 5% for a while.
I just think that being in short term T-bills right now
is the easiest decision you could make
for your fixed income allocation.
And the problem with that is,
is it gets really harder,
what happens if it goes from five to three,
then what do you do?
I think that's the hard part.
I'm just saying there's no no brainer, that's all.
I'm not disagreeing with you.
I'm just saying that like there are reasons
to take duration risk.
You say there's no no brainers.
I say it's a no brainer to be in three month T-bills right now.
At 5%.
I think that's a no brainer for,
if you have cash or fixed income needs,
I think it's a no brainer right now.
I think it's hubris.
How about that?
But here's the thing,
the Fed is not gonna drop rates for 5% of-
By the way, I can hear the YouTube comments already
really loving me this episode.
Of course, but fine, you take your 30 year treasures
and I'll take my 5% T-bills in my CDs at least 5%.
It doesn't have to be all or nothing.
Here, there is no all or nothing.
I'm just saying for people looking for stability
and what you think of for fixed income,
it hasn't been this easy in 20, 30 years,
probably fixed income investors in terms of,
I don't have to take any volatility
or duration risk right now.
I just think we haven't seen that.
Now we're on the same page.
Well, yeah, because the 10 year was 2%
or whatever for the last decade.
So that I completely agree with.
But my point is just look at this chart of the two year.
The two year got as low as like three, five, five,
two weeks ago and it's up to four, one, six.
I mean, that's a big, big move, no?
So anyway, where I was going with this is that
we were talking about a pause in March,
given the SVB blowups and all that sort of noise.
And now they're still pricing in a high probability
of another rate hike in May.
A month ago, Ben, a month ago,
there was a 21% implied probability
of rates being 500 to 525, meaning a 25 base point increase.
That went from 21% up to 91% today.
The market is pricing in a high degree of likelihood
of there being another hike.
Doesn't it seem weird though that in May?
Three month tables are still 100 basis points,
more than two year treasuries though?
I just think the bond market is confused
in the push and pull between.
Yes.
Wait, there could be a slowdown and a credit crunch
to oh wait inflation is still here.
I think the bond market is just utterly confused.
That's my only takeaway here.
We were talking last week, I think this was on T-Kef actually,
about whether or not we were currently in a recession.
And our team put this in the YouTube for like a vote.
55% of the audience says we're in a recession.
Is that higher or lower than you would have guessed,
the audience would guess?
That's higher than me.
I don't think I would have guessed that high.
I think you're doing too many podcasts these days, sir.
We talked about this survey on this,
it's very show last week.
And I said there was no-
Oh, is this show?
Yeah.
I'm sorry.
That's all right.
I said there's no chance in hell that we are in a recession.
That was my stance.
Okay, right now we are not in a recession.
Could we have a slowdown from here?
Sure, but I'd say right now my take is no recession.
Retail sales came out last week, not great.
But Spoke said the diffusion index is the lowest
since April, 2020.
And it has never been this negative
outside of a recession.
Now I feel like this sort of stuff
should be taken with a grain of salt
given fiscal stimulus that we saw
and given how wild people were spending.
And I gotta be honest, I don't know,
I've seen the word diffusion in front of an index
twice in the past week.
I'm not sure what that means.
I was gonna say that too.
I don't know what this diffusion index is.
Let's just say it's retail sales.
Let's just see.
But the great bars up there.
But we've been talking about this for months now
that all retail sales have to do is get back to normal
and that could mean a slowdown.
They're so far off trend.
The biggest collapse in retail spending,
this is just month over month,
was in gasoline stations, gas stations.
The charts is gasoline station, so I read the chart,
but I don't know if anyone calls it a gasoline station.
No, speaking of it.
I don't think so.
If I went to an interesting gasoline station
over the weekend on the way back from Hershey Park,
we stopped at, it was like a truck stop, I guess.
It was a gas station.
That's like in Pennsylvania somewhere?
Her truckers.
Yeah, we had a great time.
It rained like cats and dogs
and so that cleared out the park
because of down port for an hour.
And they have some big boy roller coasters, which was fun.
But anyway, we stopped at this trucker gas station
and there was like a subway in there,
which by the way, I love subway.
I haven't had them like, I don't know, five years.
Big fan of the people.
You love subway and Jimmy Johns.
Love.
I mean, I know subway's not really good, but I don't care.
It's good to me.
I don't mind subway.
On the loudspeaker, it's like shower number 78.
Your turn is up.
And then like five minutes here,
it's like shower number 79.
Your turn is up.
Because it's a truck stop?
Do you know that truck stop, they have showers.
Sounds like a prison, but what else are they gonna do?
They're on the life on the road.
Life on the road.
Bank of America, credit and debit card spending per household
moderated in March to 0.1% year over year.
The slowest pace since February, 2021.
Month over month, spending fell 1.5%.
Yeah, obviously the spending's got to slow eventually.
I mean, people are spending like gangbusters.
Does this mean that all the anecdotes
that you and I are talking about all the time?
Because we keep talking about the anecdotes
of people traveling and spending money
and going out into restaurants.
Are those anecdotes, are people substituting spending
and they're just focusing on these kind of areas
in their maybe not spending and other stuff now?
Because everyone talks about the anecdotes of gosh,
this plane was full and this theme park was full
and these restaurants are full and the prices are ridiculous.
But if you look at these numbers like this,
it doesn't seem like spending is continuing
to get out of control.
Out of control to the downside or what?
No, the upside, we keep saying that it seems
like people keep spending and how are these people doing it?
They must be going into credit card debt.
That's like the logical conclusion you'd think
from all these trips you see people taking.
But the data doesn't really back that up.
I saw a chart, I think I can remember
post to this dang it.
It was like credit card spending is I think still below
2019 levels are right there abouts.
So this idea that credit card debt is keeping
the consumer alive is.
It's back on trend.
It's hogwash.
Yeah, if you look at the credit card.
Oh, is this it?
Well, yeah.
Here we go.
It basically fell and came right back up.
But total credit card debt in the country
is back on trend basically.
Okay, so average credit card utilization rate
by household income just eyeball.
And this looks like what's back to where it was,
actually the under 50,000 cohort is still very low.
This is interesting.
We got Empire State Manufacturing data
and it was the first time that it increased in five months.
So I don't really know what to make of that.
But look at this prices paid chart, the fourth one down.
What is this showing me here?
The prices prayed for the Empire State Manufacturing survey.
The numbers are going down.
That's what I'm trying to show you.
So inflation, okay.
Here's an anecdote that I was talking about.
This is from the Wall Street Journal.
The Wall Street Journal had a thing saying,
basically everyone wants to travel to Europe right now.
And if you go to any of the resorts in Europe,
all you see is Americans.
I'm sure this is a little bit of an exaggeration, but.
Josh and Chris just went to Europe.
Reservations for European trips
rose 8% over last summer.
Delta Airlines president Glen Hollenstein said last week
that 75% of the carriers international flights
this summer already booked,
even with added flights and seats.
So I mean, what is the cost of a European trip?
If you go for seven to 10 days,
that's gotta be what?
15, 20 grand flights and everything,
80 to a little cheaper because of the Euro or something,
but that's an expensive trip.
So are we to assume that, I don't know,
is it just rich people spending money these days
and all this stuff about everyone spending money
and everyone's going to get a credit card debt?
That's just not true.
Well, look at this chart.
So if you have an income over 125k,
the credit card utilization rate,
which I'm guessing is how much people spend divided
by their max balance, that was like 28% or so.
In 2018 and 2019, that number for households earning
over 125k is down to 23%.
Or are we assuming that people are still
just spending down their savings?
It's like the excess savings things.
People are still spending down those savings
from the pandemic.
Dude, I don't know.
I feel like a lot of this data just doesn't match up.
That's my problem.
It seems like, because inflation is higher
and people are doing all this stuff and spending money,
it seems like all this stuff doesn't match up.
That's what I'm trying to get at here.
I have no idea what's happening.
I really don't.
I don't either.
Here's an analogy I wanna make.
If a recession is on the horizon,
this is a Crock-Pot recession.
It is simmering at a low heat.
The top is starting to bounce a little bit
from the liquid or whatever.
And this is a slow burning recession
that will be moderate, I guess, if I have to guess.
Can I have for a hot Crock-Pot take?
80% of stuff people making a Crock-Pot is gross.
Well, by definition,
there's some stuff people making a Crock-Pot that's okay.
Like my wife makes a great spicy sausage dip.
It's just Rotel tomatoes and cream cheese and sausage.
It's amazing for dip.
Oh, it sounds wonderful.
But most stuff people making a Crock-Pot is gross.
Okay, so I don't know if this is a Jewish thing specifically,
but Jewish people eat brisket.
I'm not saying Jews are the only people that eat brisket,
but we eat brisket.
A brisket needs to be cooked forever, forever and ever.
So it's gotta be done in a Crock-Pot.
But once you do, if you could cook it long enough
and it gets that texture,
I love it.
So you're right, it's not a great cut of meat,
but under the right circumstances, that's it?
Yeah, so I like brisket too.
But yeah, but brisket from a Crock-Pot is gross.
You want it from like a smoker or something?
Any thoughts on my analogy there?
No, I agree.
A Crock-Pot recession.
By the way, whilst you're journal,
you could take that one as opposed to the one
that Ben actually stole from you.
You could take this one.
So I do agree, I think a lot of people want it to be an event.
The headlines are gonna come out of that today,
we went into a recession.
And you're right, if it happens,
we're gonna slowly, it's the Jerry Seinfeld soda machine
where it takes a few pushes to get the,
if you wanna tip a pop machine over,
it's gonna take a few pushes, it goes back and forth.
That's what this recession is gonna be like, how that?
It's a soda pop recession.
And I don't say soda, it's a pop machine,
but I know the people in the coast like soda pop.
That works too.
Soda pop sounds like someone would say in the 1950s
wearing like a varsity jacket.
Adults say pop.
Okay, thread from Eric Batchunas,
Vanguard took in a billion dollars a day in Q1,
up against 10 year rolling flows to 2.3 trillion,
no one else is close.
30 bill went into its money market fund.
He says Vanguard was more or less
the only buyer of US equities in Q1.
Wow.
I don't know about that.
Maybe no one is doing a back test.
When he says that he probably means like,
he netted it all out in Vanguard was the net buyer.
He said they let ETF flows, 36% of the second place.
I mean, they're just, they're dominating.
So it says Vanguard took in 13 billion in Q1,
the rest of the industry combined saw outflows.
Wow, that's a great set.
That's wild.
That also just shows Vanguard's scale.
We're letting this bid staying well on this.
And the scale and the behavior of Vanguard investors
is truly unique.
But look at this next chart.
This is what we really wanted to get to.
Batchunas said, we expect Vanguard to dominate ETFs
for quite a while and surpass BlackRock
and market share in the next two years or so.
Not only do they have the natural demand,
but also look at the mutual funds.
This is where I'm going with this.
Mutual funds still make up three quarters of their assets.
That's crazy.
That is pretty wild.
Is that just because they're all buy and hold investors
and didn't want to change over or 401Ks?
Or what do you think the reason for that is?
I think both.
All right, here's a hot take for you.
Is Warren Buffett actually bad for investors?
What?
Remember we talked last week about outperformance.
And the funny thing was I wrote a blog post
about the outperformance thing.
Like would you rather outperforming a bull market
or a bear market?
And you said bear and a lot of people agreed with you.
But the funny thing was is I got a lot of people who said,
I prefer to outperform in a bull market and a bear market.
And these people weren't kidding.
And I said, well, if you can do that,
then you need to be charging three and 30, sir,
because you're an amazing investor if you can do that.
Anyway, Jason Zweig had this date.
And we've talked about this from Professor Bessonbinder
who I think is at Arizona State.
He talked about how half the stocks have ever generated
positive returns over their lifetime.
And 4.3% of stocks created all net gains in the US market
between 1926 and 2016.
That's when we were trying to reach for last week.
So he said that, unsurprisingly,
studies have shown that on average,
the fewer stocks a fund owns, the lower its returns.
So the more concentrated you are, the lower your returns.
Over three, five, 10, 15, 20, 25 year periods,
funds holding at least 100 positions outperformed
those with fewer than 50.
Over all those same periods, except the past five years,
the most diversified funds also earned high returns
on those with 50 to 99.
So the more diversified you are, the better your returns,
which a lot of people would think would be the opposite.
But the point is,
I would have thought the opposite.
That's interesting.
Because you have these grand slam stocks
like Apple and Amazon, if you aren't in those stocks,
if you missed one of those, you're screwed.
It's counterintuitive, but owning an index fund
and be more diversified increases your ads of outperformance
of all of their investors.
I just want to make one clarifying statement with this data,
which is what it is.
I trust the data, which is supporting index fund investors
buying hold, and I'm an advocate for that, I get it.
However, so what this is showing is like, basically,
if you buy a stock and hold it forever,
it's not worth owning relative to owning a basket of stocks,
just generally speaking, most stocks
or lousy investments, which I agree with.
However, active investors, obviously,
are not buying a stock at inception
and holding it for its duration.
Just because a company has a lousy lifetime return
doesn't mean that there aren't opportunities to make money.
Yes, I agree.
For example, I just sold Facebook, not to break.
A stock could be down 60% over a three-year period.
It still could have gained 100% over a three-month period.
I knew that you sold Facebook because you shared receipts
with us on Slack.
I feel like you were getting ahead of this.
I shared receipts because you asked for receipts.
So what are the numbers?
That's a fair point.
But I think the reason that concentrated portfolios
underperform is because you have an extreme,
the people who outperform, outperform by a ton,
and there's way more people who underperform
with a concentrated portfolio.
If you want to outperform,
a concentrated portfolio is the way to do it,
but very few people can be a buffet.
No, it depends how much do you want to outperform by?
The more diversified you are,
the less likely you are to significantly outperform.
Yes.
And significantly underperform.
The surprising one there is that Peter Lynch
used to own thousands of stocks.
He might have taken small positions.
He had a lot of holdings in his companies.
Yes, if you go back and read the Peter Lynch stuff.
I did not know that.
All right, I listened to a lot of conference calls this week.
And one of the interesting charts is from Charles Schwab.
By the way, I bought Schwab.
I used some of my proceeds from Facebook to buy Schwab.
You're pivoting from tech to finance.
Just as the piece.
But look at this chart,
transactional cash per account.
It shows cash per account
and cash is a percentage of the portfolio.
And it's as low as it's been.
This chart goes back to 2004.
Only 5% of a balance is in cash,
like just cash sending an account,
non-interest bearing cash,
getting whatever 40 base points,
whatever the minimum is.
But I guess my point is,
for that to be the low in 2004,
just eyeballing this, what do you think the average is?
Is the average 10%?
Yeah, that is surprising.
I think if you went to pinpoint one general investor misbehavior,
I would say, is holding too much cash in general.
And just not being fully invested?
Yeah, if this is a brokerage account,
your cash should be your cash
and I'm all for having a cash buffer.
But there's no reason to have a 10% cash drag
in your long-term investing portfolio.
I would be surprised if this number doesn't rise
in the coming months.
With Robinhood's cash sweep,
which you don't have to do anything for,
I think they pay 4.4%.
And I do feel like people will see that and go,
ooh, I think I'm just gonna hold off
and wait for stocks for a little longer.
I think a lot of people will have that mindset.
If it's just a cash sweep and it's giving you that much money,
I think some people will feel very comfortable doing that
and just sitting there.
Yeah, I feel very confident 4% too, absolutely.
I agree, that's why you have to define,
what does this account for?
Is this account for stocks
or do I have to have an asset allocation here?
Because if it's for stocks
and you're trying to time it
and you're probably not gonna win that game.
All right, is inflation thing happening here?
I looked at the last 10 annualized inflation reading.
So every month they give up the annualized number,
it peaked at 9.06% in June.
It has been down in the last nine readings since then.
And the last one actually was,
technically we're going decimal points, 4.98%,
we're under 5%.
So there is a trend here.
Obviously the counterpoint for a lot of people would be,
yes, the rate of change is slowing,
but all that inflation is cumulative
and prices overall are still higher
even if they're rising at a lower rate.
Both are true.
Yes, it's a good trend.
But policy decisions are based on the latest number.
Policy decisions are not based on cumulative inflation,
it's based on where it is today.
Other people have done this,
I haven't done it, but don't you think once the June
and July and August numbers start falling off the 9%
and the 8.5% that we're gonna be at 3.5% by, I don't know,
end of this summer, probably?
Yeah, I'm sure you could easily do that on a spreadsheet.
I don't know what the numbers are,
but Jeremy Schwartz has a tweet.
He said, a few chart updates with our CPI calculations
that include alternative shelter components.
Officially, CPI shows headline inflation of 5%
in the last 12 months.
Our calculations show under 3%.
Inflation was much higher in reality before
and now much lower.
So based on the way that inflation,
shelter is calculated,
there are some shenanigans with a lag going on
and according to Jeremy's calculations,
inflation is under 3%.
I read this this morning, I thought this was a good one.
What is the average inflation rate
in the last five years in this country?
Inclusive of all the eight or nine percent we've had,
what's the average inflation rate?
3%.
3.3%, which is basically the average of the last 100 years.
So you take the near deflation we saw in the pandemic,
add it to the really high inflation we've had since then
and you get the average, the long-term average.
Fund of numbers, but I thought that was interesting.
I'd say bullshit with numbers, but point taken.
Okay, question from a listener.
You talked about how baby boomers have so much money
for our generation and anecdotally so many financial plans
that I run for our folks have them with way more than they need.
They're diligent savers and investors
and it goes back to how Morgan Howles will talk
about growing up with the depression
and her parents feeling totally uncomfortable spending money.
So we've always boomers with excessive savings
and investments that are unwilling to turn the switch
and actually spend that money.
And anecdotally, we hear this from our advisors all the time.
All the time.
Chris who runs our wealth management division
says he's constantly having talks with people
trying to get them to spend money
and a lot of people just don't want to.
And not only that, I feel like our advisors,
they share the wins.
Like when you get a client to buy the car
or the house or the whatever that they've been like working
their entire life for, it's a huge win.
Yeah, that is a win.
And we love seeing those pictures and stuff.
So the question becomes,
do we have a permanent floor of higher inflation
in the future if boomers decide to actually spend that cash
or do they pass that on to the next generation
which does not have the depression
and our parents are more comfortable spending.
And so could there be a higher rate
from either of these things if that money gets spent?
Yeah, that's a good question.
I think that it's interesting.
Cause on the one hand,
we legitimately might have a retirement crisis
but also there are people.
Honestly, the average American that has access to a 401k,
I know that like half of the country doesn't have access to
but for the average boomer that spent the 70s, 80s, 90s,
aughts contributing to that retirement account
that are in decent financial shape,
I think a lot of them are gonna leave a lot of money behind
because the older you get,
you're spending slow dramatically.
You do have social security.
People are probably cautious
because they fear outliving their money.
And so as a result, they spend less.
I think that boomers are not going to spend down their
the problem.
And I know again, we're broad brush here, but.
It's a succession thing where 10% of the households
own 90% of the equities.
So unfortunately, most of that money's getting passed down
is gonna be from rich parents to rich kids.
That does the way with the inflation thing in my mind
because it's not like it's this broad money
that's going spread out to everyone
and everyone can spend more.
It's unfortunately going from rich people to rich people.
Unfortunately, that's how it is.
All right, we've talked about this before.
The Atlantic had this article saying
that millennial generation is just fine.
By 2019, even adjusted for inflation,
median income for millennial household
was 9,000 higher than that of Gen X
at the same age and 10,000 higher
than the median boomer household in 2019.
And the pandemic didn't really change that much.
Household incomes.
This is a great job.
So I have to 44 year olds were at historic highs in 2021.
So you look at average real wealth
and that's just for inflation.
It's kind of crazy.
Gen X is higher now than baby boomers at the same age.
Millennials are right on trend.
Gen Z is on trend.
Basically going over this myth
that all millennials are broke.
Well, dude, our parents were in their mid twenties
in the mid seventies.
Was that a great time to be a millennial back then
or a boomer our age?
No.
Or buying a house with 20% mortgage rates.
The point is millennials are right
where they should be based on other generation trends.
And I'm guessing because millennials are more highly educated,
you see this household income by education.
Millennials are going to make more money
over their careers.
Millennials are going to be the richest generation ever.
And then Gen Z will be the,
it's going to happen like that.
So why do you think millennials feel so poor then?
Why do we always see these stories
all millennials can't do this and millennials can't do that?
Cause they're saying even home ownership
at the same age, 50% of boomers owned their home
compared to 48% of millennials at the same age.
Even the housing thing is not as bad
as people make it out to be.
The main difference has to be just college costs.
People are being buried in debt coming out of college.
Our parents did not have that.
They also didn't have social media
to make them feel shitty about themselves.
I think that's part of it.
So even if the incomes are higher,
the expenses are higher too and more on your face.
I think so.
So you'd say, well,
12-couser higher, housing costs are higher.
Daycare costs are higher.
You know, all of our parents didn't have
the obsession with clicks.
Obviously they were as advertising in the 70s,
but it wasn't like fear porn like it is today.
One of the things I was thinking
of the boomer millennial thing,
my daughter has gymnastics on Thursday nights
and I was taking her there and she likes me to watch,
but I usually just bring my computer and watch
and you hear all the parent conversations
and you hear this at every sporting event
or whatever, every kids event.
And the parents talk about how busy they are
cause the kids have to go to this and they have to do this
and my ska, and every parent just loves to talk about
how busy they are cause their kids
are constantly doing stuff.
And I feel like that's something boomer parents
never talked about or complained about.
Maybe they didn't have the travel sports stuff
and they didn't have as many things to do,
but don't you feel like parents of today
love talking about parenting way more
than the previous generations did?
I have no frame of reference.
You don't think our parents complained.
I mean, probably not to us, but I don't know.
Don't you feel like our parents ignored us more
or I guess maybe this is a helicopter parenting,
but I don't feel like there was as much of a focus
on parenting as like the thing.
My mother was very strict to me.
I was punished the entire eighth grade.
You probably deserved it though.
I bet the boomer parents were more strict,
but I don't think that they were as involved
in the lives of their kids as parents are today
in terms of like the planning and the,
we never had a calendar on our fridge
when I was growing up.
That's true.
That kind of thing, everyone has that now.
Last night I randomly said to Rob,
and I was like, do you think we're doing a good job?
She's like, what do you mean?
I said, it's parents.
It's hard to tell, right?
I hope so.
Yeah, you'd do your best.
And all right, this is a good one from Steven Ratter.
Tight labor market has led to record gains
for workers at the bottom, even after inflation.
By contrast, it took till 2017 for the bottom half
of Americans to climb back to pre-great recession levels
of income.
This is showing again that the bottom 25%
has seen the biggest wealth gains.
And they saw the biggest drop off during the pandemic as well.
And now they're right back on trend.
And this to me is probably one of the more surprising charts
of any economics charts.
And there's been a lot of surprising ones
that if you were to say inflation is out of control
and at four decade highs, but the bottom 25%
is seeing the biggest wage gains because of it.
Has this ever happened before?
That's kind of a real question.
No, and I don't think so, right?
The way our society is structured, people are very upset
about this because who pays for the bottom 25%,
people with money and people with money.
It is funny, yes.
Are literally paying their wages and there's inflation.
And so no, society will definitely not share this on,
even though it is objectively a good thing.
This is a good thing.
There's no federal minimum wage that was raised,
but the pandemic effectively raised minimum wage
and it's higher than it's ever been.
And it, I don't know, doubled probably
in the last three years.
I agree.
So if you're going to the restaurant,
you're complaining about higher prices for food and drinks,
you're paying higher wages for people who needed a boost
and they got it.
All right, let's talk about crypto just for a second,
which has been on an incredible tear.
You know, like an NNBA playoff game, they'll go like,
he's got a quiet 30 points tonight.
I feel like Bitcoin is up a quiet 100% from the bottom.
That's a good point.
I think most regular people aren't talking about it
because given how burned they got,
but Bitcoin started the year at 15.
What do you mean when you say regular people?
Do you do back tests or don't do back tests?
Non-crypto natives.
I feel like we've been defining regular people
six different ways.
It started the year at 16.5 now, it's at 30.
And maybe one of the reasons why we don't discuss it a lot
is because meaning we Americans is, I don't know why,
but it leads me to this point.
So data track, this is Nicholas,
said virtual currencies are much more of a global phenomenon
than many US investors may realize.
For example, Google trends search volume data shows
that the countries with the greatest collective interest
in virtual currencies and related events in the space
are in Europe, Africa, Asia, Central America,
and the Middle East.
The United States rarely makes the top 10.
And I think this makes sense because we have by far
the best financial infrastructure in the entire world.
I don't know, for all Americans, why do we need crypto?
Well, I also think there was enough inks build on crypto
and enough talking points made
that I think people are sick of talking about it
until something actually happens.
And there's an actual use case.
That's what there's no talking about
because people are sick of talking about what could it be
and people are ready to hear like, what will it be?
We're not worried about the government stealing our money
or serious debasement and I could hear
the crypto max is going nuts right now,
but you know what I mean?
It's, this is not a third world country.
Our dollars are pretty secure despite inflation.
All right, let's talk about AI.
Did you see this thing?
Somebody tweeted the music industry
is about to change forever.
This AI generated songs created by Ghostwriter 977.
It's blown up on TikTok.
It features AI, Drake featuring the weekend
and is so good.
Do you listen to this?
I didn't.
I don't like listening to Drake's regular music.
So I'm not gonna listen to an AI generated one,
but I don't know.
This kind of thing doesn't worry me as much
because I think there's gonna be lawsuits up the ass
for this stuff.
And I think this stuff is gonna get cut down
before it ever takes off.
You think that the music industry
and the movie industry is gonna let AI take over?
That's my big thing about AI is
the established players are not just going to let this happen
on a creative field.
Don't you think you think that artists are gonna let AI
take their voices without getting paid somehow?
There's no way this is ever gonna happen.
How about this?
I don't have really any opinions, we'll see.
But Andrew, the metaverse guy, Steinwald tweeted,
I'm pretty freaked out about job losses from AI.
This is not like we created a new tractor
for farmers that requires 10 fewer farmers.
AI is a tool that will require fewer people for all work.
This is like the release of a new mega tractor
for every industry all at the same time.
Overblown or somewhere in between or what?
I think one of the reasons tech people are freaking out
so much maybe it's because they understand it better than us.
But it's also because aren't tech people the most
at risk of their job losses here?
Don't you think tech people are the ones
who should be scared the most of AI replacing them?
I really don't know.
I think that there are wide-ranging implications
for a lot of industries.
Yes, but mostly knowledge industries.
I think about the stuff that AI is not
gonna replace in my life.
Is AI gonna change the personal trainer at your gym
or something?
I feel like a lot of the physical stuff
you do in the real world, people don't have to worry about.
I think it's the people who are in the tech sector
who are gonna have to worry the most
because if you can tell an AI, do this coding for me.
Quick as 10 engineers shouldn't tech people be the most worried
and maybe that's why they're freaking out so much.
Within the next five years, will there be some sort of,
I don't know if societal upheaval is too strong a word
but will there be a cultural divide between people
that use AI and people that were laid off because of it?
I don't think it's far-fetched.
Could be.
I also think that AI is gonna create jobs as well.
I know people keep talking about good jobs,
it's gonna take away.
There's gonna have to be some sort of filter there
where people can help use it and explain it.
The music industry stuff, I'm sure people are gonna be using it.
I'm sure the musical artists are gonna be using it
to help them make music just like they use more technology
than they did in the past.
So I think people forget about how many jobs technology
actually creates over time too.
There's certain industries for sure.
You'd think the call center thing would be,
I don't know how many millions of people
work at call centers around the world.
That's the kind of thing where AI probably will take it away
but I don't know, never five years ago,
Scott Galloway had that thing that there are more cashiers
in the country than teachers or something.
And people were worried about,
well Amazon's gonna have this grocery store
that's gonna take away all the cashier jobs.
And you see it in McDonald's,
has that caused riots in the streets?
Cause there's not as many cashiers
cause now we have the self-scan stuff.
But I think this is this guy's point is that
this is coming for every industry.
I don't know if there's ever been anything like that.
I don't think it's coming for every industry though,
that's my point.
There's some physical stuff that a computer just can't do,
I think.
Happy to be wrong.
Yeah, it's not gonna take everybody's job.
I do think that we will revisit this issue
on future podcasts.
So New York Post, I said,
I think AI is gonna probably do more harm than good,
even if it does a lot of good.
So AI clone teen girl's voice in $1 million kidnapping scam
that says I got your daughter.
The mother said, I never doubted for one second
that it was her.
That's the freakiest part that really got to my core.
That's so awful.
You sent us an email,
didn't someone threaten to assassinate you?
Was it an AI bot?
Yeah.
I gotta be honest,
as hilariously worded as that email was,
there was a second where I was like, wait a minute.
It wasn't even asking you for anything, didn't it?
Just saying like, I'm gonna assassinate you.
Sorry, nothing to do.
I've gotten similar emails accusing me
that they've seen me doing,
let's just say inappropriate things.
And so I called my friend.
He goes, I got the exact same email.
Everyone gets that.
Pay us money, we're gonna shoot.
But the funny thing is,
let's say someone did have a video of you
doing something very inappropriate.
If you talk about their bluff.
Yeah, I was about to talk about it
and say our life is over.
My friend literally,
and I only know this because we joke about this today,
my friend replied,
because he's such a dumb, dumb.
I don't think he knew that it was fake.
He replied, you send it.
Called their bluff.
Maybe this is a reason that many millennials
are still unhappy,
even though the incomes are the same.
Lance Lambert in March 2023,
or is March 23% of the nation's 200 largest housing markets
registered a month or a month decline,
77% of the markets registered an increase.
So he has this cool chart that shows that
percentage that are growing versus declining.
And the declining happened for a while,
and now it's going the opposite direction.
And a lot of these housing markets are rising again.
Back to him.
Among the nation's 400 largest housing markets tracked
by Zil, 218 or back to or just set a new all time high
for housing prices.
This doesn't seem like it should be happening
in a world with housing prices that are 50% higher
and 7% mortgage rates.
This part is not great.
I guess if mortgage rates stayed at 7% for another five years,
housing prices would have to just churn lower and lower.
But I do think that there's a scenario where
mortgage rates go to 5% and the whole housing thing
just puts a floor under it.
And we never see even a big correction
people were looking for.
There's obviously some places that are seeing it.
If rates stay at 7% for the next three years,
we will definitely see housing prices come lower.
And I say definitely, I think definitely.
But if we don't, then you're right,
maybe we don't get the big correction.
I just think that like the affordability back to 2019 levels
is unfortunately, I think a pipe dream.
That might be gone.
I don't think that's ever coming back.
So Lance Lambert again, among the nation's 400 largest
housing markets tracked by Zil, 218 markets are back to
or just set a new all time high for house prices.
Yeah, I mean, I feel for people our age and younger
who are trying to get into a home, it's brutal.
Do you want me to point out the fact that I just read
that piece or not?
Please, that's my bad.
I apologize.
We had an email that caught my attention and hand up.
That's sorry.
I was gonna let it slide.
I'll do better.
Mike Simonson, median price was single family home
is still $4.39.9 up a tad over 2022.
Median price of new listings is $3.99,
4% lower than last year.
And again, these are both going up again.
This is interesting to me.
Can I say not good?
No, not good.
So Adam Azamak had this new paper out
and he talks about, this is an interesting piece.
The research shows remote work caused like 60%
of the increase in prices,
which I don't know how you do the attribution there.
But let's say it's plus or minus 20% there,
like that remote work had a big piece of it.
His point is, why did rents and housing prices go up
in big cities then if people were leaving them
during the pandemic?
And his answer was household formation.
And so I think this is the thing that the wave of millennials
who want to buy houses and form households
is so big that it's dwarfing these other financial
spreadsheet aspects of higher rates and higher prices
in that the demographic thing is just the thing.
It's the tail wagging the dog.
That is why the prices are going to have a floor on
is the millennial household formation stuff is just,
that's the thing.
It's a trump card.
Harry Dunst said it many years ago,
demographics is destiny.
All right, one more real estate thing.
Have not seen him predicting a crash lately.
I'm sure he's still bearish.
Every six months, there's a new biggest crash
in history that's coming.
Just wait.
Someone sent me this.
It's the average rents in Manhattan by number of bedrooms.
So it's studio one bedroom, two bedrooms, studio is 3200,
one bedroom 4200, two bedroom 6,000,
and three bedroom 10,800.
This is average prices.
Manhattan feels like a made up place to me.
Maybe this is your point about New York.
It's not just New York, it's Manhattan.
I've never lived in Manhattan.
I can never afford it.
I can see why if these are average prices.
Holy s- it just, it feels like a made up place to me.
My first apartment lease was in Astoria.
And Robin and I were just talking about this the other day.
We had a good apartment relatively speaking.
And I think we paid $2,000 for like a big one bedroom.
That apartment is definitely probably 4,000 right now.
The person in me that remembers my 20s
totally understands why people would move to New York
and everything about it.
And the old middle age man in me looks at these numbers
and says, I don't get it.
It's like a competing thing in me where I do get it,
but I still don't get it.
Well, you get it for young people.
It's an incredible place to spend your 20s.
Yes.
I guess that's why yeah.
You get four roommates.
Yeah.
All right, great quarter guys.
I was lacking with Ben and Josh this morning.
That quarter was so freaking awesome.
And we're investors in quarter.
Just full disclosure.
I've mentioned that before.
I was listening to Goldman Sachs live this morning.
I jumped onto the conference call live.
And even in the live chat or the live conference call,
you could still have rewind.
Does Goldman CEO DJ the hold music as you're waiting
for the call to start?
He does DJ David Solly.
He does the opening remarks.
Yeah, he was pretty cautious.
I don't pay too much attention to Goldman's numbers,
but can I get on top of this one?
Is Lloyd Blankfein going to come back and take a golden sax?
Not bad.
You can still that one.
Next week is the big week.
Next week is 42% of the S&P reporting.
This week we've got Netflix after the bell.
I am still holding.
So you sold space but still holding Netflix?
Yeah, still holding.
Well, because I just feel like I mean, whatever.
Jamie Diamond said the US economy continues to be
on generally healthy footings.
However, storm clouds remain on the horizon,
banking industry ads to remote.
OK.
He's a master at talking out of both sides of his mouth.
He can always talk about how things are fine,
but there could be a crisis you never know.
They reported record numbers as they seemingly always do.
And I have to say, like all of the Jamie adulation,
it's deserved.
It really is.
I listened to David Solomon.
I listened to Schwab.
I listened to Walt Beninger, who was very great.
I listened to Larry Fink, who was just reading,
prepared remarks.
Jamie is the best on conference calls.
He lets his CFO answer like the specific financial related
questions about whatever.
But he jumps in.
He's like, can I just jump in?
And he just is just slaying, demolishing the entire call.
He's in a class of his own.
All right.
At least on conference calls.
So for example, I pulled this quote.
I thought this was interesting.
He said, they're talking about the Fed funds.
He said, first of all, I don't believe it.
The Fed has the rate curve.
The forward short term rate curve,
almost 1% higher than what the market has.
So one of the things you've got to always prepare for
is it could be anything.
We don't know what the rate curve is going to be in the year.
And so we're quite cautious in that
and quite thoughtful about that.
Obviously, the short term rate is higher recessionary risk.
But and then inflation coming down.
So I think inflation will come down a little bit.
It could easily be stickier than people think.
And therefore, the rate curve will have to go.
He's confused just like us.
That's what I was going to do.
So we were talking about earlier in the show,
what is the bond market saying?
What is this market saying?
There's a lot of confusion across every part of the...
That's the longer code.
If you're not confused, you're not paying attention.
Especially now.
All right.
Thanks for America.
Look at this.
So we talk about credit crunch and all that sort of stuff.
But look at the banks.
So you've got the net income at an all-time high.
You've got common equity tier one capital and the ratio is
trying to get in the right direction.
I thought this was interesting.
They look at like net charge offs.
It was up to $807 million, up from $608 million,
the quarter before and $520 million, the quarter before that.
So that's creeping up.
They said consumer net charge offs driven primarily
by higher credit card losses.
So the credit card loss rate in the first quarter was 2.2%.
It was 1.7% of Q4.
And it was 3% in 2019, which is important.
So prior to the pandemic, it was 3%.
So it's rising, but it's still 2.2%.
So really nothing to speak of there.
Look at this next chart, Ben.
Digital volumes.
I don't know what Erica is, but I am a Zell user.
I've heard Erica before.
And it shows a chart of Zell transactions versus checks.
I mean, checks are in secular decline, right?
That's a bear market.
Yeah.
I still see old people using them to the grocery store
occasionally.
Oh, really?
You haven't seen that before?
At the grocery store, I went to the movie theater this weekend
with Josh to see the Big Lebaski, the 25th anniversary.
You know in the open, you see where he writes a check out
for milk?
That is the definition of a rewatchable movie.
That only gets better as you watch it more and more times.
The most rewatchable.
OK, average deposit trend.
So Bank of America knows something about deposits.
I don't know if they're the biggest consumer bank in the world,
but they got them in the top three.
You see anything here, Ben, to cause alarm or anything?
I mean, aren't the big banks just going to get stronger?
I know this is backwards looking.
Remember those are banking crisis?
They were beneficiary, but look at the weekly
and the deposit trends.
It shows interest bearing, not interest bearing a total.
Nothing going on here.
I feel like every time a bank or a credit card releases something,
it's like this next chart.
Consumers, something remains strong.
Consumer, whatever, remains strong.
This is credit worthiness.
Yeah.
I know that this is backward looking, and the SBB stuff happened
in the tail end of this first quarter.
So I get it.
We'll find out next quarter.
But forget about that, because even prior to the banking stuff,
people were worried about the economy rolling over,
the consumer rolling over, and they might.
But it's a Crockpot recession, Ben,
if we're heading towards one.
They might, it just hasn't happened for the last year.
There's the title to the show right there.
Crockpot recession.
Crockpot recession, okay.
Trademark that.
I want to give a plug to a company that we invested
in about a year ago that's been building something
for financial advisors.
So I've been thinking a lot about this, Ben.
Our tech stack that the financial advisor uses
is pretty mature.
There's not a lot of gaps.
There's very few things that we're still using
a spreadsheet to do.
One of those things that-
It's like my personal budget.
Is I can't believe that.
There's no personal finance tools out there.
One of the things that we're still doing is,
and this is not my world, but we have a lot of clients.
The supply still is dynamically modeling out
their equity compensation, and how that impacts their taxes,
and all that sort of stuff.
This is a crazy data point.
There was $762 billion of tax under withholding in 2021 alone.
So what does that mean, like under withholding?
That means that there was $762 billion worth of surprise taxes
that people had to pay that they didn't know
that they owed money on.
So this company led by Russell Kroger,
who was a financial advisor that was second tied
of dozens of-
That was me in 2021.
That was 2021.
I had read a big check.
I did a little bit of planning this past year.
Shame on you.
So this company Triacto helps financial advisors model
equity comp for their clients,
and helps them understand the tax implications
like this under withholding that we just discussed.
I think for financial advisors that are working with clients
that have this sort of stuff,
it's gonna be a must have-
Can we show this to some of our advisors?
And you asked them after we had a call with, in a demo,
is this a want to have or need to have?
And they said, this is a need to have.
Pretty good buy signal.
So we're gonna link to this Triacto website
and the show notes.
They're still early, they've been building,
there should be like a fully functional,
and the product doesn't exist.
There's like an MVP there,
but there should be a fully functional product later
in the summer.
If you wanna join the waitlist,
Russell will reach out to you.
Individually.
So you're not gonna go into a black hole,
reach out and he will reach out to you.
Okay, that's that.
I know we're running late, but sorry,
a lot to get to today.
You saw Apple's new high-yield savings account?
I'm wondering what their end goal here is doing this.
I mean, they did the credit card.
I don't really understand it.
I'm sure there's something.
I don't know if the credit card took off.
I kind of remember the partnership with Goldman Sachs
not working well, but whatever.
Starting today, Apple Card users can choose
to grow their daily cash rewards
with a savings account for Goldman Sachs,
which offers 4.15%, but here's the other thing.
Cause I was thinking like, well,
is it only for cash rewards?
They said once a savings account is set up,
all future daily cash earned by the users
will be automatically deposited into the account.
The daily cash destination can also be changed at any time
and there's no limit on how much daily cash users can earn
to build on their savings even further.
Users can deposit additional funds
into their savings account through a link back.
Good question from Duncan.
They're working with Goldman Sachs.
Goldman's market's account pays 3.9%.
How is Apple getting more from Goldman than we are?
I guess cause Apple's not looking to make money off of this.
I don't know if they're subsidizing this,
but they're taking a much smaller spread
cause they don't care.
Pretty wild.
What if Apple becomes like a big player
in financial services?
I've always thought it should have been Amazon,
but if Apple does it, I'd be happy
to let them manage my money for me.
I know I'm jumping around just one sec,
but speaking of Amazon, then you were prescient.
Remember you said like you want Amazon
to just like build high speed wifi everywhere?
Oh yeah.
There's a service that they have called,
I don't know how to pronounce it, it's K-U-I-P-E-R.
Queeper?
Kiper?
Andy Jassy in the latter wrote,
Kiper is another example of Amazon innovating for customers
over the long term in an area where there's high customer need.
Our vision for Kiper is to create a lower earth
orbit satellite system to deliver high quality
broadband internet service to places around the world
that don't currently have it.
Boom, Ben, credit to you, you nailed it.
Anything else you want to see Amazon do
while we have their attention?
I kind of forgot about, the only thing I want from them
is them to come break down of the boxes for me my garage.
If they could do that, just bring a box cutter
and break them down and take them away for me,
reuse them.
So I don't have to bring them to the dump all the time.
Big dump guy here.
Big dump guy, still going.
One twice last week.
The recommendations?
We had a very full doc this week.
What page am I on here?
41 pages this week.
Incredible.
Yeah, we went hard this week.
Before we get to some racks, this tweet made me think.
I don't think we've spent enough time marveling at the fact
that Meta completely upended its business,
renamed itself and insisted that the Metaverse
was the next big thing, only to have AI prove that entirely
wrong like six months later.
That really is kind of wild.
I sold Facebook because I think that they already
got a lot of the benefit of the layoffs and cost cutting.
I'm not shot in front of you.
I hope this actually gets killed, but this thing is just kind of nuts.
Think about what they really did.
Are they going to change their name back to Facebook?
It was a huge miss.
Meta.ai maybe is the next, I don't know.
They can't.
That's like a dog with a tail between its legs, right?
But they're already back away from the reverse.
You know what?
Prediction, they changed their name back to Facebook.
Wouldn't surprise me.
All right.
Recommendations.
You mentioned Dave last week.
I thought episode two of Dave was just one of the best episodes
of television I've seen this year so far.
He's so good.
He was on the town with Matt Bellany talking about how he...
Dave was?
Yeah.
It was a couple of weeks ago.
Oh, I missed it.
I think it was I was in Florida and he talked about how he just is supremely confident
in his abilities and he knew he was going to be a star someday.
And he's not like a over the top egomaniac, but he's just like,
I knew if I put in the work that was going to happen.
It's a very smart show.
You're right.
Larry David, I forgot when we were in Florida.
Now I think it was on Peacock now, knock at the cabin.
We watched knock at the cabin.
That's the M night Shyamalan one.
Probably a better premise than a movie, but I kind of enjoyed it despite the fact that
it was a little dark.
But I really like movies that make you think we're going to put you in a weird scenario
and you can have a conversation of like, what would you do in that scenario?
I thought the first 85% was like really pretty solid.
Yeah, I liked it better than I thought.
They didn't land the plane at the end, but if you've seen the movie, they literally didn't
land the plane.
No spoiler there.
Somehow last weekend, I got sucked into Father of the Bride, which is a movie I probably
haven't seen in 25 years.
My wife loves that movie.
That's another one that back in the day, I would watch that with my mom.
I have two daughters.
That's the kind of movie that hits differently once you have kids.
And I mean, first of all, Steve Martin is just fantastic in that movie.
Amazing.
There's a guy who's been 50 for his whole life, but totally hits differently once you have
kids, especially daughters.
And it kind of got me a little bit at the end, a little like, a little dusty.
I can admit it.
I got a little sappy.
That's all I got.
The first episode of Barry last night, I love that show.
I'm cautious.
Here's the thing.
The writers are HBO.
The writers are so good that I don't want to like fade them.
So I'm only one episode and we'll see.
I watched the first two episodes.
Okay, how was the second episode?
If they didn't have no ho hank, there's an amazing scene with no ho hank at a Dave and
Buster's.
That's all I'm going to say.
But it really used to be a much lighter show.
I think he's obviously doing it on purpose, but after we watched the first episodes, my
wife just goes, man, this show has gotten really dark.
I still really like it.
It's really well done.
It's very dark.
So I think the one movie that I've watched more runtime of than any other movie, I feel
pretty confident in this is Casino.
It's always on and I always catch 20 minutes of it.
And I feel like it's underappreciated.
I know Goodfellows is better, but I don't think the gaps as big as a lot of people
think it is.
I was always a Goodfellows is way up here and Casino is a step down.
That was always my initial read on it.
But I did rewatch Casino a couple of years ago.
I'm still a Goodfellows guy.
What's on my I'm just saying, I don't think the gap is that big.
Okay, agree to disagree.
We've done a lot of that this episode.
And hey, I don't know.
I got nothing.
Unless we're going to knock at the cabin.
We got that going for us.
All right.
Thank you for sticking around.
This is a long episode.
So if you're still with us, we appreciate it.
We appreciate you listening.
AnimalSpirtsPod at gmail.com.
Oh wait, wait, before we go, someone on YouTube gave a comment saying Michael didn't realize
he was middle aged, even though he's bald.
His wife complains about his shirt options.
And what was the other thing?
He wants to grab a minivan or something.
It was just perfect.
You figure out you're middle aged.
I love it.
I'm still fighting it.
I'm still fighting it.
All right.
See you next week.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
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