Most Stocks Suck (EP.414)
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So grow your RIA your way with Betterment Advisor Solutions. Learn more at betterment.com slash advisors. Investing involves risk. Performance not guaranteed. Today's show is also brought to you by Crane Shares. Ben, we've spoken about the number one. So active ETFs are having a moment. They are having a moment. And the number one active ETF is a covered call strategy. And this shocks me.

There are only three international cover-crawled ETFs. And given that, I just saw IFA as having the best start to a year in 25 years. If this keeps going, we will see more launches. Prediction. Oh, interesting. So options on international...

indices or stocks are not as prevalent as the US. I didn't realize that. Okay. So we've talked to Brendan Ahern from Crane Shares before about, how do you say it? You say- I say K-Lip. You say K-Lip, but it's clip. K-L-I-P. They call it K-Web. Why would you call it clip? I get it. You're clipping-

Right. So they have their K-Web strategy, which is the Chinese internet companies. And then they also do CLIP, which is the income on those. And again, these technology stocks tend to be more highly volatile. That means potentially more option income because of the volatility. That's right, Ben. You can also find the link to the webinar they recently did, Resilient Covered Call Strategies During Superior Market Volatility, in the show notes. Click that link.

Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Batnick 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 Ritholtz Wealth Management. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast. ♪

Welcome to Animal Spirits with Michael and Ben. Did Memorial Day creep up on us this year? Are we back to middle-aged, time is passing guy? Yeah. Before we get into this, I got to ask you a question. What percentage of your wardrobe is nixed these days? Because I feel like it's 95%.

Is that close? After, what game was it? What was game one? After Tuesday, I've been in a bear market, but yeah, probably 98%. Okay, so you were in mourning a little bit. You weren't there for the gut punch game, were you? You weren't there for game two? I was there. Okay, I haven't talked to you about it. For the Hal Burton bounce and comeback? So, thank God, I left. It was 40 seconds left. We were up, I think, eight, and OG got fouled.

They reviewed it. So I figured, all right, I'm leaving. Like I had a train to catch. I don't need to be part of the nonsense in 7th Avenue. And then they overturned that foul call, even though it was a foul. And thank God, thank God I watched it on the train. I might have- Oh, so you weren't even in the building for that. Okay. I agree. That would be because the silence was deafening kind of thing after that, after a regulation. I couldn't listen to any podcast. No recap. Didn't hear it. Couldn't do it. Really tough. What were we saying?

You can't believe it's Memorial Day already. Old Man Conversations at the Beach Club this weekend. Me and some of the dads were talking about the Merrick train station parking lot and the this and the that. I'm like, oh, my dick, guys. We're so old. This is... We're talking about... Yeah, where to park. Okay.

We're coming to Chicago next week, as mentioned a couple of weeks ago. Can you believe it's going to be June already? I can't believe it. Unbelievable. Where does the time go? And I'm very excited. I looked at the forecast. The weather is immaculate. The vibes shall be great. It's our biggest RDM getaway. I think we've got almost 50 people coming. We're doing an event at the Salt Shed. We are excited to say the least.

So we will see you there or we will see you at another time. Yeah, we'll be doing the live compound. You and I will be recording Animal Spirits from somewhere in Chicago, probably our new office. One of those days. I can't. This will be our first of two trips to Chicago in a month. Yeah. So you and I are seeing each other a lot lately. Can't wait to see you. Keeping things fresh. Yeah. So if you're in Chicago, come say hi.

All right. So last week, the new worry, and I feel like the market only has room for one worry at a time. This is a theory I've been thinking for a while. Oh, I like that take. You know, we just short attention spans. We've already kind of moved on from tariffs. And it does feel like the market just slapped the wrist of the tariff policies. And even when Trump says, oh, I'm going to do 50% tariff on Europe and Apple can't make their iPhones in India anymore. You know what the market said? No one really believes it anymore. The market said-

I don't believe you. It was the Rod Bergen. Because on Friday, we gapped down what? Like, I don't know, a percent or so. And given the incredible rally that we've had in stocks, I don't think it would have surprised anybody if we said, oh, shit, here we go again. The market's down 3% heading into the weekend. Who wants to be long on a three-day weekend? Stocks closed at the high of the days. Buying yields were relatively unchanged. And so sure enough, I guess the market got it right this time. Because on Sunday, he said, just kidding.

We're gonna we're gonna punt that to June 9th July 9th We've moved on from my children having to work in a sweatshop again and creator aren't t-shirts or something So the big worry last week now is bond yields, right? It wasn't just the US but I pulled up just I typed in Bond market or something like that into Google and look at all the top stories, right? Is this the breaking point for the US bond market? Oh GOP bill locks a new deficit as bond market quakes and it's all these scary headlines and

of bond yields are rising, this is bad, and then people were tweeting about Japan. This is from Barchart. Their 40-year bond yield hit 3.6%, all-time high, which is kind of nuts if you think about it, an all-time high for long-term bond yields. And so the question for people is,

okay, rising bond yields must be bad because people are worried about the deficit. They're worried about government spending. They're worried about inflation. It's a worry about something. And maybe these things are true, but my whole point is just, let's just take a breath on the bond stuff. And every time yields rise, we get worried. And every time they fall, we get worried. Yeah. That's a good point. It's been in a four to 5% range for, I don't know, two years now-ish. Yeah. Can I say that I'm not not worried?

Like, I don't want to completely sweep it under the rug, but I will also say that what you just said is valid. Let's take a breath. So I think part of it is we were accustomed to such low yields in the 2010s that what if, what if this is just a normalization? I looked at the average returns by, or the average yields by decade for the 30-year treasury. Don't come at me with average by decade. Who cares? So it was 11% in the 80s. Okay. In the 90s, it was 7%. Erroneous. In the 2000s, it was 6%. Erroneous.

But now look at this. Look at the chart of the last couple of years. It's it's average 4 percent and it's been in a 4 to 5 percent range forever. And every time we go up, we go down. What's the opposite of erroneous? Is it erroneous? I don't know. Because that's that's valid. It has been in a range. But and I even pulled up the returns for like the 10 year treasuries this year. IEF is the 7 to 10 year treasury. OK, people are freaking out about bonds.

This is up 2% this year. And most of that is yield because, you know, rates have kind of gone nowhere. But are we really having a bond freak out? Because bonds are up 2% over the last year. They're up like 5%. I'm not freaking out. In fact, last week, I bought zeros and TLT. See, I feel like the timing of the duration never works, though. It worked last time I bought it. Who has the ability to time duration like this? Me, easy. Okay.

So you're going to do the range thing? It gets to five, you're buying duration. It gets to four, you're lighting up. Is that your plan? First of all, for the record, I'm obviously kidding. But this is not like a buy and hold for me. I'll sell it if it rips. Well, I hope not. Yeah, that'd be a crazy sort of buy and hold product. So Matthew Klein at the overshoot, which I feel like he's always kind of a calming voice. And he said, what if this is just what normalization looks like? And he looked at Japan and he said, listen, if you look at what Japan was like

In the years prior to the pandemic period and post-pandemic period, their inflation was a lot lower, their growth was a lot lower, their spending was a lot lower. And now if you match up where the growth is, where the inflation is, where the spending is, these rates make more sense in this environment. And you also, I've seen a lot of people poking holes in the whole deficit thing. People saying like, well, the new tax bill is going to add so much money to the deficit. It's crazy.

So he said the U.S. Congress is moving forward with a budget plan that would not lower most American taxes relative to current rates. Yeah, so if you look at it, a lot of it is just keeping things the same. It's lowering for some people, not very many. We talked to Bill Sweet about this the other day. We said, Bill, what's this going to do to our taxes? He said, nothing. There's no, it keeps them the same, but not, no material change.

He also said it would meaningfully cut spending on health benefits for the poor for Medicaid, food aid for the poor for SNAP, and subsidies for green energy. The budget is also set to sharply increase taxes imposed on premier research universities. Remember Doge? That was cute. No, but he says combined with tariffs, which are taxes imposed on Americans, the net effect should be contractionary relative to the current fiscal stance. Interesting.

But you could say, well, what if the tariffs continue to come lower than that? So it's kind of a wash, essentially, is what he's saying. Not nearly as bad as— What if this is just normalization? Because look at the yield curve. I pulled this up from—I feel bad. I had Sean make me a yield curve this morning. And I said, oh, wait a minute. Why did I have Sean do that? We probably have one on Exhibit A. So I went to Exhibit A. So I got a yield curve, and it shows the yield curve from a year ago and the yield curve for today. So I remember—I'm old enough to remember—

That's something people say on a podcast. I'm old enough to remember when the inverted yield curve was a problem. Remember how scary that was? Inverted yield curve always leads to recession, except for this time. Now the yield curve is becoming uninverted. Look at this. This, is this not normal? Is this normalization to you? Looks like it to me.

Now, the retort is just wait, Ben, the bad stuff. And maybe maybe this is this is like the American exceptionalism premium going away. And people are worried about deficits and government spending, because I really do believe I think I tweeted this the other day. I know people get really angry, but my baseline assumption is government debt will continue to increase. Government spending will continue to increase.

Maybe voters will get mad enough eventually that they'll put someone in office who will not. There's no reason to think anything else. Exactly. Like you can get mad at it, but that's the baseline assumption. That should be your baseline. And that's my baseline. So what if this is just a normalization and people are freaking out? And the thing is, the world we live in now is maybe just higher bond yields on the long end. Because I thought it was crazy. It was nuts when we had 9% inflation and higher, longer term bond yields didn't budge at all.

Remember, they didn't move up meaningfully. It was just short-term rates. I think this is just normalization. Fair enough? Fair enough. All right. What's my favorite thing about Wall Street Journal articles? The anecdotes. The anecdotes. All right. This is the gut-wrenching play in investing right now is buy and hold. So they interviewed some more people about their strategy for… You know what we should call this? We should call these anecdotes. Okay. That's not bad.

So, this anecdote here is one I think that happens for stock market investors all across the country almost all the time. When a chunk of Bill Jensen's retirement savings got wiped out in early April, he started to second-guess himself. And I'm coming to the point where these could be AI-made-up stories, and I wouldn't doubt it, right? I'm just going to start not trusting anything just to be safe, but let's, you know, go with it. His wife urged him to consider switching their savings from stocks into safer investments, but Jensen insisted they wait for the market to rebound.

He's a retired 68-year-old who tried to reassure both of them by sending emails to the gains when their portfolio ended in green. So he's like showing her, listen, it's worked out fine in the past. Seven weeks later, the couple's investments recovered most of the losses. Rather than take risk down a notch, he recommitted to the stock market. But I feel like almost every couple has this where one of the people is saying, oh, gosh, this is too scary. Get us out. And one of the people – don't you think that happens all the time with people? Sure. Like that's –

that's a conversation people are having a lot. Yeah, we've said this a bunch over the past couple of weeks, but I'll say it again. The market gave you a get out of jail free card. If you were like really worried and about to do something, probably, probably do something right now.

Right. But now it's harder because you're like, well, what if it keeps going up? No, no, no. This is easy. This is a much better place to do it. Yeah, you're right. If you wanted to lighten up. So I'm curious. Does Robin ever come to you and ask you about your investments or does she completely? All the time. She won't stop asking me about it. Are you serious? No. Okay. She never? No. I've tried. She just. I think my wife asked when we first got married. And I told you this. I gave her like a PowerPoint presentation of why we're going to invest all of our retirement savings in the stock market.

And that was all I needed to do. You're like, Courtney, you're not listening. Eyes on me. Okay, so we got an email last week that I thought was really, really fair in response to the conversation we had last week about the investor class being more educated and better behaved.

Was just listening to the latest podcast and the discussion of financial education and retail investor behavior improving. I agree directionally, but can't help but wonder if that's giving them credit for what had been relatively easy tests. With the dominance of the big tech names, both as businesses and stocks and Walmart's inexplicable multiple, the S&P 500 has had an incredible run and it just keeps working. The COVID crash and the recent tariff tantrum

were extremely short in duration and basically rewarded investors immediately. 2022 was a longer downturn, but even the Chad GBT reveal pretty much returned everything to normal. Buy NASDAQ, S&P, and you'll make money almost immediately. These downturns are in stark contrast to one, the early 2000s, the GFC. To be clear, I fully support and recommend systematic buying of index funds no matter what's happening in the market. I'm not saying people should have to do all kinds of research and or pick stocks to build a global portfolio, nor do I hope for

for sharp downturn in the market just to be proven correct or deliver some kind of comeuppance. Just saying, I'm not sure the last five to 10 years of investors piling into the S&P 500 through mostly brief drawdowns is solid evidence of long-term discipline yet. I don't entirely disagree or agree. I think it's a fair counterpoint. Okay. I kind of disagree because we've had three bear markets this century alone or this decade alone. And it's not just the bear markets, which have been relatively mild, true.

If you invested in Bitcoin, you've lived through like four or five 80% drawdowns, right? Yeah. If you invested in some of the individual stocks, Amazon was down 60% and video was down 70%. That's true. Right. Some of these, some of these are not just losses. They are catastrophic losses. Yeah. So even though the returns came back relatively quickly, I don't know. I mean, I tend to think the great financial crisis could be a once in a lifetime event.

So do I. Well, it could be or it could not be. We're going to have another financial crisis at some point, but like that one, it's possible we don't. It's hard to prove anything, but what if we can say that investors are generally better educated, better behaved, less prone to panics than they used to be, and also it has been a relatively benign investment environment? What if it's a chicken and the egg kind of thing, though? The fact that people are better behaved and there's more automatic contributions, that makes the downturns not last as long.

What if it's circular? That's Josh's relentless bid theory. Yeah. No, it impacts the markets for sure.

But it can't save the market from downturn. It did it in 2020. It did it in 2022. But if you look at 2022, that was… I always break out between recessionary and non-recessionary bear markets. And if you look at a non-recessionary bear market, 2022 is textbook. The downturn, the length of time, the peak to trough, the return, break even, all that stuff. It's a fair assessment. So we were asking, where is all the money coming from the last couple weeks? Jeffrey Patak from Morningstar said,

friend of the show sent me some numbers because i said it's got to be just bonds or money markets we're on wages yeah and so wages is a big one so because wages are up you know more than inflation by a little bit this but he showed this is from april the flows you saw money big time money coming out of taxable bonds and municipal bonds to the tune of almost 50 billion dollars and over 21 billion dollars of flows into u.s equities so

Not all of that money went into stocks, but a lot of it came out of bonds into stocks. That is interesting. Right? So there is some of this. And I always say there's like, what, four reasons you buy bonds. Yield and income. You always say that? I've never heard you say that. Yeah, I've said it before. Yield and income. Yield and income.

Stability, like volatility reduction, spending purposes. And then dry powder, right? So people are using… I feel like dry powder is a catch-all. Dry powder rolls up at the one through three. But I mean, dry powder for rebalancing. All right, so here's another thing.

26 million customers at Robinhood. So I had Steve Quirk on this show on Asset Compound last week, and he talked about this. So there's 26 million customers at Robinhood now. 13 million of them, it's their first brokerage account. And a few people said, hey, what if it's Gen Z and millennials who cannot afford to buy a home, but they have that income still that they would be using to buy a home, and now they're putting it into the market. Like, you look at this. I pulled this from a quarter. I pulled it from a quarter. It's the Robinhood deck. Net deposits in Q1 –

$18 billion, 37% annualized growth. Yeah, that's something. $57 billion over the last 12 months. So look at their deposits are growing by leaps and bounds still. And it's a lot of factors, but I guess that's part of it. Here, read this other email because we had a lot of people who responded with this too about the money market stuff. Okay, so we have to do a bit of a mea culpa. And Ben, no offense, I'm going to put this on you. Although I didn't flag it, so it's on me too.

Somebody said- I have a retort here, but just go ahead. There's no retort. These are facts. No. Go ahead. I follow this stuff pretty closely. And the withdrawal in money markets in March and April, the last two years was not to buy stocks. It is to pay tax payments. How do we prove this? Because we look for a spike in deposits into the treasury general account of the Fed. You can look this up yourself.

It didn't go to stocks and went to Uncle Sam. And Warren Pies has done a lot of work on this. There is a very seasonal component of this. So the money that came out of money market funds that we mentioned last week did not go to buy stocks and went to pay taxes. Which is funny, which is why the stock market falls in. Here's the reason why I didn't flag this. My planning brain goes, who are the idiots who don't set aside enough for taxes that have to sell stocks to pay their taxes? Sell stocks? These are money market funds. Okay, never mind.

Oh, okay. I totally got that wrong. You're right. Yeah. That's okay. All right. My brain broke. No, sometimes we get things wrong. That's okay. But it's kind of funny though that that causes also the stock market to fall. It does. In the last two Aprils. Yeah. Warren and Fernando have done some great work on this. Like really, truly. That's what my brain is saying. So people are obviously selling stocks to pay for taxes too a little bit. I don't know if they're selling stocks and or just not buying enough or not buying as much.

Okay, but somehow this is that but that's what I'm saying You don't think that there are people selling stocks to pay off their taxes because they did miss plan. Absolutely. Does that move the market? I have no idea. Um, all right, this Has me excited Ben. I'm excited. I

We've shared this chart before. Every advisor shares this chart. And the chart is that the odds of the S&P 500 being higher over time increases dramatically if you zoom out. So we grabbed this chart from Exhibit A. My all-time favorite long-term stock market chart. I want to say I'm going to give credit to Jeremy Siegel for this one probably for the first time I ever saw it in stocks for the long run, but I could be wrong. Okay.

So the quote is, if you hold stocks over a 20-year period nominally, you've never lost money. And it's powerful. And it does inspire, maybe not confidence, but it shows you stocks for the long run. But there is a huge and obvious counterpoint to this that occurred to me while I was listening to the Berkshire annual meeting. And Warren said something about the likelihood of a decline in stocks

Same thing. The longer you go out, you're almost guaranteed to have one. And I said, you're a son of a bitch. He did it again. So I called Matt immediately and I told him we got to flip this chart. And so for chart of the week, for exhibit A, for advice.com, if you're a financial advisor, check us out. We're sending out charts of the week and it's our new fresh chart every week with your logo on it. So what I had Matt do was show the odds of experiencing a bear market also increased by holding period.

So it looks exactly the same. It's basically linear. So over any one-year rolling period since 1950, you had a one in three chance of experiencing a 20% decline. If you go out to 15 years, it's 100% of the time. So yes, the message that advisors preach to their clients is stocks for the long run,

Less is more. Keep your eye on the ball. The money's not for today. But this chart is equally, if not more important, because the facts are that those long-term returns are tough as shit and they always come with setbacks. Credit to you. This is a great chart. I told you the one that I honed in on to highlight is 77% of the time over five years. So you'd tell your clients, listen,

80% of the time over a five-year period, there's an 80% chance you're going to get a bear market. That is enough to like, I think, help people understand the risk involved of either you have a steady hand and you hold, or you need cash, fixed income, something else in your portfolio. In a 20, by the way, look, look at four years. Nice.

If a client says to you in 2024, after back-to-back 20% years, hey, asshole, why am I 60% stocks? What is this nonsense? Like, why are these bonds slowing me down? You show them this chart. Yes. Credit to Matt. Credit to me. All right. So I feel like the… I feel like rich people have always… I've always had their own moment, but they're just… Rich people are…

Having a moment unlike any other time before they're more scrutinized than ever before. I think they're they're just the spider-man meme Are you pointing to yourself? But are you having a moment?

No, this is like the rich, rich, rich people. So you saw this story in the Wall Street Journal about the jaw-dropping cost of a Hamptons girls weekend. I saw the tweets. Okay, I'm sure you saw the tweets. And it's talking about how it can easily cost $5,000 to go to Hamptons for a girls weekend of drinks and Ubers and outfit changes and workout classes. Yeah.

And, you know, someone, Haley Sacks, has she been on the Compound Friends before? She's talked to Josh before. She says the Hamptons is like Disneyland now. And so she says you have to go to all these places and Instagram. And obviously these are Instagram influencers. It's not real people. But I do feel like, so they talk about how there's like $97 lobster salads. And I don't know if I asked you, have you ever gone to the Hamptons before? Is that your thing? What do you think? Probably not.

I've been. I'm not regularly. No. Yeah. Come on. But I do feel like there's something to the fact of there's a lot of things that I think we've all just, I know people complained about inflation and we hate it, but I think a lot of it is just like resignation. Like, yeah, this is just what it costs now. Like these things that are so expensive and ridiculous and I can't believe I'm paying this much money.

Yeah. It's like, geez, that kind of stinks, but we just do it. Yeah. I think there's just resignation of what's the one thing in your life that you can't believe costs as much as it does. I'll start it. Then you can think of one. So there's a Greek salad that we got here in town and it's iceberg lettuce and you know, whatever it's Greek salad, but they have great dressing. So I will give, I will give them that it's $19 and I, I can't believe it. Um, I won't order it, but Robin does.

You know, the funny thing for me is that you go out somewhere to have dinner or go to a bar to get a drink and you get a beer and it's, I don't know, $8 or something. $8 or $10 for a beer, right? But the weird thing that sticker shocks me is getting a six-pack and now it's like $19. My good Oberon summer beer, right?

How much should that used to be? 12? Yeah. Just something like that, which is still probably a pretty good deal. But we had this conversation this week about, I'm sure you've had these conversations about houses that are in your neighborhood. Someone brings it up. Like, can you believe the house down the street sold for that much? Yeah. And they go, you know, in 2017, we bought for this.

And you're doing the math and you had to think what yours is worth, obviously. But someone finally just said like, that's how much houses cost now. Kind of like slap to the face, like get used to it. This is where we are now. And I think that's the thing. That's my whole thing is just, I think it's just resignation of like, oh yeah, this is just how much stuff costs now. Yeah. And people have moved on. There was another article in the cut titled, it's a weird time to be rich now. And this is kind of- What is the cut? I don't know what that is.

That is the New York Magazine, like one of their, you know, it's like the Grantland for New York Magazine, I guess. So they talk about all these rich people are going to therapists and complaining about how weird it is to be rich right now. And they don't want to be like too flashy and show offy because they don't want like people showing up at their house with pitchforks and torches, I guess.

But I pulled this out. A real estate agent who sells luxury properties in the tri-state area is seeing the same thing. It's a weird time to be rich right now. All the wealthy people I know are keeping their cards closer to the chest. When people have that much money, stuff like inflation doesn't really affect them. What they do care about, though, is being judged for their conspicuous consumption. When the whole world is crying poor and you're living the life— It's conspicuous. What did I say? Conspicuous. Okay. Close enough. And

And you're living the life in this wealthy bubble. It's really frowned upon. They've all seen the white Lotus. No one wants to be like that. Some people want to be like that. Come on, let's be honest. Yes. But, but I feel like this rich people in the white, like we've shown such a light in this and there's so many shows and, you know, succession and white Lotus and your friends and neighbors and the influencer stuff. And I just think wealthy people in the past didn't ever think this deeply about their wealth.

No, no, no, no, no, no. Not true. There was a lot of like Bill Gates in the 90s or whatever driving Toyotas. It's always been a thing for mega rich people to not be opulent. Did I use a word properly? Speaking of word messing up is. But I just feel like now is the, it's harder than ever for an uber rich person to be happy. That's my take. What? You're too in your head when you're rich. I don't know about that. You're making that up. It's never been harder for a rich person to be happy?

You don't think more rich people are miserable today than they were before? I think rich people are way more miserable than they were. I have no idea. Because on a relative basis, you see other people's wealth. You don't think that? I don't know. I don't know. Well, but here's the part. I think there's a lot of miserable rich people out there. If you live in a rich town, then you're not hunting anything. True. It's the opposite. Yeah, you want to flaunt it. Yeah. If you live in a upper middle class town, you're probably less likely to

you know, drive a Ferrari or whatever. That's true. There are a handful of like Ferraris or because there's a handful of billionaires in West Michigan and you see the Ferrari and you see it on the road and you go, whoa, whoa. But in New York, you probably wouldn't think twice. But if you're a billionaire, why not drive a Ferrari? Like who cares? It's not like you could hide your wealth anyway. Listen to each their own. I don't know. Whatever.

True. All right. So I pulled the retail sales graph just to kind of drive this point home about spending. And it's just, it's weird to me that I, you can see the charts here. I circled like after the great financial crisis, there was a new trend for retail spending and it was down. Like we took a huge thing down and then the trend took a long time to get back on. And since the pandemic, it's just been way higher and it's still trending higher. And this is why I just, it's,

The whole risk thing about, and obviously some of this is inflation. I just think there's a new mindset these days. What is it? Spending, investing, speculation, risk, all that. The 2020s is, maybe that's our roaring 2020s. It's just a risk appetite change. I'm just trying to wrap my head around it still. Yeah. I think you're right. All right. I want to point out, so CB Insights has their quarterly state of venture report.

AI now drives one in five venture deals. Pretty wild, right? We were talking to Rich Bernstein on TCAF last week. Do you know what, I don't know if you listened to the show, but if you didn't, do you know what OpenAI's most recent funding round was? I saw it in a headline, but no, I don't know. Okay. They raised $40 billion, and you can guess who led that round. They raised $40 billion on $300 billion valuation. 300. I thought DeepSeek was going to be the end of all these AI companies. Here's another one. I didn't see it either.

Eight early stage AI companies raised- No, wait, wait. I'm surprised that it's not higher than one in five. I thought it would be 50% of them by now. Well, for context, in 2022, it was one in 10. Okay. But you're right. I think it's, I mean, it's up to the right. Eight early stage AI companies raised $100 million mega rounds. That's a new record. NVIDIA, obviously they were a big backer of CoreWeave. They've done 49 equity deals. And they also show Google's done 49-

Microsoft has done 24. This is since 2020 and Amazon's done 20. So I guess these are the new megafunds. Kind of wild. I'm really fascinated by where the AI stuff goes. Did you see the videos this weekend? I just think that there's so many different paths we could take from it, good and bad, that I don't even think you could possibly predict what is all going to come out of this at this point. We're going to talk about this later. Did you see Mission Impossible yet? I'm guessing no. I didn't, but I will see it in the theater. Okay. I'm a TC supporter. Sure.

All right. So on Quarters app- Did you see it? I did. We'll talk about it in a sec. On Quarters app, I said, make me a chart of Uber free cash flow. So they have Claude and ChatGBT in there. So I said, make me a chart of Uber free cash flow by quarter for the last five years. And they said, there is no avail- They, meaning the-

The LLM said there is no available data for Uber's free cashflow by quarter for the last five years. The request information is not present in the latest financial disclosures. So in my head, I gave a shoulder strike. I'm like, what the heck? What do you mean? So I typed to them, can't you calculate it based on the financial statements? Boom, chart on. See that? Isn't that wild? It's called prompting, huh? All LSA was like, come on, man, figure it out. And it did. Oh, that's pretty good. Um,

So there was a Bloomberg article traveling around this morning, and it said, "Welcome to the academia in the age of artificial intelligence." And I keep harping on this one. "As several recent reports have shown, outsourcing one's homework to AI has become routine. Perversely, students who still put in the hard work often look worse by comparison with their peers who don't." So like you put in a lot of hard work on your own paper, and someone else does an AI paper, theirs is going to look way better than yours.

They say professors find it nearly impossible to distinguish computer-generated copy from the real thing, and even weirder, have started using AI themselves to evaluate where students work. So students are turning in AI papers. Professors are having them graded by AI.

And the whole, the crux of the article was does college still have a purpose in the age of Chad GPT? But I keep coming back to the fact that this is why being a creative person is going to be such a thing that sets you apart. I was thinking about the early days of reading Josh's Reform Broker blog and him writing in his own voice and sharing his own inside jokes and experiences and

I think that's the blogger stuff that people really latched onto in the 2010s. I think why that whole scene of finance Twitter took off, because people were, it was like a breath of fresh air to hear people write in their own voice as opposed to some stuffy Wall Street research piece. And I feel like that kind of stuff, the ability to write in your own voice is going to be more important than ever in the years ahead. I don't think the chat LGBTs of the world are going to change

anything in terms of we're not going to be all of a sudden reading stuff that is clearly generated by a computer. I think it's going to be like you, people like you who are just incorporating this into their own writing. Yes. Right? Because this stuff, it's obvious and it's sterile. I think so too, which is kind of funny. It says that professors find it nearly impossible to distinguish. Like you couldn't tell that the freshman kid in your English class is all of a sudden creating way better paper. So don't you- But wait, but wait. I'm sure you could say-

to the whoever, whatever program you're using and make it sound like it was written by a 19 year old. That's true. I mean, but wouldn't, couldn't you take the first day of class? Like everyone, like put in a few, uh, some grammar that doesn't really flow too well. The first day of class, I want everyone to write a one page paper about this subject. And that's my baseline for your writing skills. And I'm going to be matching your papers. You turn into this baseline there. If you're a professor, I feel like there's gotta be easy ways to around this. I'm sure there are.

Maybe they're just too lazy to figure it out. I don't know. Speaking of AI, so Michael Mauboussin had a new piece out for Morgan Stanley, Drawdowns and Recoveries. It's 24 pages or something. Now, anytime I, in the past, would get a very long research note. Shame on you. No, this is not a shame on me. This is just time saver. Anytime in the past I get a really long research note, I would scroll through the charts. I'd read the first paragraph. Then I'd do Control-F, Conclusion, and then I'd read the conclusion.

I feel like Mobison deserves some respect. You don't chat. Okay. You don't chat GPT Mobison. Come on. Okay. So I chat GPT Mobison. Then I went back and I read the key points. Anyway, you read this too. Cause you put some stuff in here. Why don't you go first?

I actually have not read it yet. I read the first, what page am I on? I'm on page two. I haven't read it yet. It was a busy weekend. I'm going to read it though. I'm going to read it. Okay. So he looked at the drawdowns of individual stocks, not just the stock market. Why don't we read this and we'll circle back to it. I did read it.

That's what I'm talking about. I'm going to share with you some of my findings. Your findings. This is clearly a chat with you finding. So I see that. I see the, I see it. I know it is. And then I went back and I read it, the points that made sense. So I didn't read it all, but he's looking at the draw. They looked at 6,500 companies from 1985 to 2024. The median drawdown of this is individual stocks was 85%. I buy it. Which lasts about two and a half years. And then he looked at the time, like the peak recovery was 90%.

to get back. So meaning a lot of them didn't come back. And so they said only 46% of the stocks that had these drawdowns managed to recover their prior peak. Yep. So most of the stocks that fall, but it was also skewed. Most stocks are not worth buying and holding at all. So he looked at the median and the average, and the average peak recovery is like 340%.

But that's because it's skewed by a handful of stocks. So they even put a chart in here, which I did pull the chart. And you can see the recovery. There's a handful of stocks that if you bought when they were down that much. Is that Carvana? I'm sure it is. You did amazing. But most of the stocks did really poorly.

Which is, again, just so you see these, this is the Nvidia thing. Like Nvidia fell 70%, Netflix fell 70%. You idiot, why wouldn't you buy that? This paper from Bessemender and also Howard Marks ruined me as a stock picker. Because I read Howard Marks' stuff about second level thinking. I never bought Apple. So it's like, this is first level nonsense. Who is buying Apple? This is like 2014. But all jokes aside, knowing this data like you and I do,

And I still pick stocks, but as a game, not because I think I'm going to retire off of it. It's a bad idea. The data set, this is not me saying it. Most stocks are garbage. Most stocks don't be treasury bills. You know what I've been doing for the past couple of months? I've been slowly but surely trimming all the individual stocks in my brokerage account and just pouring it in index funds. Ain't nothing wrong with that.

I look at them less. I'm not constantly checking my Robinhood account. Yeah. It's just less, as Wes Gray would say, it's less brain damage. Very valid. Counterpoint, content for the pod. True. Don't worry, I'll carry the load for now. You know what I was going to say? You were talking about IMAX before we get on here. And look at the chart of IMAX. Maybe this is a New Yorker thing, but you and Josh love to share good news about the stocks you own. Is that fair? Yeah.

Josh loves Uber. Josh is a big Crash Track Uber guy. However, if you control F, how many times have I mentioned IMAX in our group chat? That's true. So I haven't even- Hold on, hold on, hold on. How many times? I did it this weekend when there was an article in the New York Times about them. I'd say a dozen mentions of IMAX. No way. No way. Control F right now. Go to Slack. I'm calling you out. This is recency bias. I did it today. I mean, no, I did it over the weekend. You're right. No, this is in-person chats as well. Come on. I don't talk about IMAX in person. Get out of here.

Yeah, I've heard it on the podcast. Listen. All right. No, look right now. You'll find at least a mention because I did it this weekend. I'd say you said 12. I'm going to say five or less. 13 messages IMAX has mentioned here. All right. I stand corrected. Okay. So a couple of them are from Josh. Okay. But how many from me and how many of them cluster? How many is like in the same conversation? All right. So I see five from you. All right. We're both right. All right.

Listen, listen, fine. I'm not embarrassed. I'm proud of IMAX. I feel like it's not too often that the fundamentals and technicals line up. They are dominating and the stock is breaking out. Sorry, not sorry. And you're, this is, see, you did learn. This is first level thinking from you. You go to IMAX. This is your Peter Lynch stock. You go to IMAX theaters a lot. You buy IMAX. Dude, the sound is wild. You better see it in IMAX. My daughter went to IMAX for a...

field trip last week and they went into, they just, they didn't see a real movie. They saw some like national geographic something on IMAX. They saw like two 45 minute, whatever. And she was blown away. She had never, we've never taken her to IMAX before. She loved it. Do her favor and buy her the stock in a, in a up my account or whatever. All right. Let's talk about the real estate market. Carl Quintanilla on blue sky, existing home, slowest pace, slowest sales pace for any April since 2009. Okay.

Um, it is crazy that like the number of existing home sales are basically down to the housing crash lows, more or less. We're right there. Well, yeah. Rates are ridiculous. I still can't believe I say this all the time that rates are still 7% for mortgages. But it's gone on this long. We opened up the conversation talking about the, you know, should we be worried about the long end of the curve? Uh, yeah. But this is another thing where it hasn't totally derailed. Yeah.

The market besides like, it hasn't caused a huge something besides making it more annoying for first time home buyers. Annoying. It totally derailed the housing market. It's, it's, it's an ice age. I'm saying from a price perspective, I think most people would have assumed from a price perspective, that would have been where the derail came from. Yeah. It's worse. You haven't even got, you haven't even gotten the prices coming down. That's what I mean. If, if prices came down, at least it would have spurred activity. So it didn't do anything from that perspective. All right. From Sherwood. Yeah.

This is a good one. They say America's homes and the people who buy them are getting older. We've been talking about this a lot lately, like the median age for the first time home buyer. But they

They show, so they say the existing home buyer repeat went from like 35 in 1980 to 61 now. We talked about this last week. The first time home buyer is 38. But this is an interesting one. The typical home that people are buying keep getting older. So the median age of homes sold in the U.S. in 2012, it was 27 years. Right now it's 36 years because they say only 9% of all existing homes in the U.S. were built in the 2010s, which is the lowest decade going back to the 1940s.

So we basically stopped building homes in 2010s because of the housing bust. Wow. It's sad that a boom and bust caused this to happen, and home builders just pulled back. They also show the median age of homes purchased in 2024—

And you could click on your town. So I clicked on Grand Rapids. The median age in Grand Rapids, Michigan is 42 years. And then they show the median price of a home that is less than five years old or that is 30 plus years. And it's like, I don't know, almost a $200,000 difference. So they're showing the price of the homes, the older homes versus the newer homes. This is, I guess, just why, I don't know, you buy Home Depot in Lowe's. If they're not building enough homes, there's going to have to be massive renovations.

Right? The younger people coming in are going to want their HGTV house. Spaces to entertain, big garages, right? Outdoor spaces, all that stuff. All right, from the Wall Street Journal, a lack of starter homes. This is a good one too.

This is one of the reasons houses are becoming unaffordable. In 1950, 92% of all homes built were 1,500 square feet or less. Remember the Pope's house we looked at a few weeks ago? That tiny thing? Which apparently the town took into receivership and they said, no one's going to buy the Pope's house. It's going to be like a shrine or something.

I don't know what they're going to do with it. Now that number is 22%. So we're just not building smaller houses anymore. And this is, you can blame a lot of people. Part of it is the consumer. They don't want small houses anymore. Yeah. You can blame home builders, but I think people want bigger houses. Yeah, totally. One of the reasons there's no starter homes anymore and they're not affordable. Obviously, builders, I think, get higher margins and higher price points on bigger houses. But consumers want...

More amenities. Like if you look at what they were building in the 1950s, it was no frills, no nothing. It was a thousand square foot, a couple of rooms, no walk-in closets, no three car garages, smaller houses. Yeah. All right. Moving on. Ben, you've been, you've been on this case talking about private equity coming in, coming for retail, coming for 401ks. So the FT wrote an article this weekend talking about that dynamic, dynamic

The billionaire co-founder of buyout firm Tom Abravo has said wealthy individuals should be concerned about companies that private equity firms cannot sell, ending up at funds aimed at retail investors. Now, in the article, they didn't mention anything that it's actually happening. It was just a sort of, you know, beware. So he's worried that retail is going to be the bag holder. Yeah. Now, maybe- Wait, where do you think that phrase came from? It's a great phrase. Bag holder. There has to be a story behind that. Maybe someone can email him if they know it.

I'm thinking like a sack, like a satchel of coins that were like maybe empty, an empty bag. I don't know. Anyway, they're not in this business yet of going direct to retail. They're still all institutions. So maybe this is them talking their buck a little bit. Isn't that illegal or is it not illegal if you disclose it? Like if private equity giant A is buying one of their companies in the retail channel from their institutional backed funds,

Is that legal? I mean, obviously it's shitty, but if they can't find a buy-in, they're like, eh, all right. These schmucks will hold the bag for us. I mean, listen, they have really great lawyers. They have 200-page prospectuses. Yeah, unfortunately. And I don't know. Maybe it won't be as bad as I'm thinking. Oh, wait. This is Chad GPT, actually. It was a phrase from the 18th century. In the literal sense, someone stuck holding a worthless item.

Like being left holding a bag of stolen goods while everyone else runs away. Okay. Again, the problem is, if this happens, we're not going to know about it for a very long time, like how the ramifications. It takes so long for these funds to play out that we're not going to know that these results are bad for like five, seven, ten years possibly. Because the marks are kind of old. And until you get an actual, you know, event, a company gets sold or goes public,

We've spoken about this before, just a remarkable chart. This is from Morgan Stanley. Today, 87% of US companies with over $100 million in revenue are private. Just wild. And then they share the private market share of global AUM is up from, it was hovering around 7% from 2013 to 2017, then it broke out and now it's over 10%. I think it's probably going to go higher. So this is the sales pitch though, right? If there's that many companies...

that are private without making that much money, that's like, hey, you're not getting access to these companies. You need access. Yeah, I think it's legit. I also think that most people are skeptical or downright cynical of private investments. And I think that is understandable, but I think a little bit misplaced. There are areas of the market that you just cannot access inside of an ETF, for example. And I'm not saying that these are good or bad or otherwise, but natural resources, infrastructure,

litigation finance, GP stakes, secondaries, all of those sort of things. Again, no commentary on good, bad, or otherwise. There is potential diversification. There's potential upside. So I think it's prudent for most people to look at these things a little bit sideways, but to just, it's all bullshit. It's not all bullshit.

Right. Of course. Yeah. There's a ton of money in here and, and many institutional investors have done well here. It's, it's probably the problem is the range of outcomes is way wider. Yeah. And also how to, how do you evaluate it? Um, by the time it's getting to you, like all that sort of stuff, obviously. That's why it's my only solution is it has to be in a target date fund, right? 20% of this target date fund is going to be private or 10% or five or whatever it is. I think that's the, that's the most prudent way to do it if it's going to be done. Yeah, I agree.

All right. So we got a bunch of feedback from people living in San Diego and everyone kind of agreed with our assessment. Housing costs are too high, but it's worth it. But we were there, we got, we're at the golf course and the golf course looked fantastic. And someone asked us, Hey, do you guys golf? And we both said, nah, we don't. I think the first time we ever golfed was seventh grade or something. So I started way late. My dad loves golf. He golfs all the time. Oh yeah. My dad golfs four times a week. So why did you never get into it?

I was always doing something else. I had other sports going on. I wasn't a dork. I don't know. It just, one of those things. I'm kidding. I just, it never, and I think because I didn't have the patience to put in the work and the time, I got, it was infuriating me because I was bad at it. Same, yeah. And so I never put in the work. But, so I thought about this and I know it takes up a lot of time and we're, we just choose to do other things, right? Because golf could take up a lot of time. It's expensive, but I know people do love it. So I wrote this blog post

And I wrote some things that I'll just never spend money on. And golf was one of them. And I wrote all these other things. Some of them I was just being tongue-in-cheek and funny and whatever. This is kind of a throwaway blog post, I thought. And it kind of went crazy on LinkedIn because people commenting on it. Oh, I totally agree with you on three of those. But this one, you're an idiot. You're wrong. And it's just a really good reminder that people love to judge people.

but hate to be judged on what they spend on. Yeah, that's a great point. Yep, you're right. Right? But it's a fun game to play. Like, why would they spend on that? But it's all, my point is, Ryan Holiday had this thing where it's either works, family, or scene. Pick two. Work, family. Work, family, scene. Scene is like going out. Okay. So like, if you, you can try to do all three, but if you do. I do all three. Okay.

One of them is going to suffer though. If you put too much into one, another one is going to suffer. I feel like I balance it pretty well, not to brag. All right, sure. You just have it all figured out. If you need advice, you come to me. I got you covered. I wonder how he does it. Life guru. All right. The point is though- You know what? Actually- If you go out too much, you're not at home with your family. You're missing games and stuff, right? That's the point. I really- I'm not even going to caveat this with saying, oh, I teach- I really hate the life philosophers. Can't stand it.

Cannot stand it. I'm sorry. I know it helps some people. My God, it drives me nuts. Irrationally nuts. I watched the liver King doc over the weekend. I don't know why. I think it was just, you know, it was on a fall asleep. That a Netflix thing. Yeah. And, uh, needless to say, by the way, that was three years ago, 2022 that, that it came out that he was doing steroids. I feel like that was like yesterday, whatever. Point is he's a, he's a life guru guy who was obviously, uh, not exactly practicing what he preached the nine and central tenants. And you could look like me. And then he was just doing steroids. Um,

But he was like, yeah, I was full of shit. But it's just, to me, it's just so transparently obvious. Like, why are you telling people how to live their life? You don't have enough problems of your own. You have it all figured out that you're going to like give strangers advice, like mental advice. It's just so tiresome. I hate it. I do agree. But obviously there's always going to be a market for it because there's- How big is the self-help market? Is it a hundred billion dollar market? And there's new self-help books all the time to reframe your mind and

Obviously people need it. - Yeah, well I've mixed feelings because on the one hand there are people that genuinely benefit, you know? So I don't want to like discount that entirely, but the people that give it on the internet

Oh, I agree. And you do wonder how many people actually it just goes in one ear, not the other. And then they're on to the next self-help because it's like, bro, you're 26 years old. What are you talking about? Yeah. How much life experience do you actually have? Like there's this book I read a long time ago called Mindless Eating, and it was a psychology of food. And the point is the one step that stuck out to me all the time was 95% of people who want to die and lose weight end up getting the weight back. And I think that's probably how it is with most self-help people. And I'm guessing the market for self-help, obviously you can graduate out of it.

is just, I'm sure there's some people who are just constantly consuming this stuff and never actually applying it to their life. You could take the building blocks from a lot of big self-help stuff and apply some of it, but it's like, well, what if there's a better way to do it? And another way. Yeah. Once you see through it, though, it's, I don't know. So last week we talked about, there was a New York Times story about people taking Social Security early because they were freaked out. And we got a ton of emails from people saying,

And it was all the same exact tone. I'm like, hand up. I'm taking it early because I've done the break even calculations and, you know, I wouldn't break even till I'm 77 or 80 or something. And I just don't care. I want I want the money now.

Like, I don't care what the data says. I thought we were pretty fair on that last week. I thought that we, or maybe I'm wrong. Maybe I'm misremembering it. But like, I totally get that. I'm not going to besmirch anybody for doing that. But I think though, if you don't have enough saved, the best way to ensure that you beat the longevity risk is you work a little longer. And then that allows you to push social security back. So you work until, instead of retiring at 65, you work till 67 or 70. Then judge not lest ye be judged.

But obviously no one wants to work longer, but this is interesting. So this is from IMF's World Economic Outlook. Based on samples in 41 countries suggested that the average 70-year-old in 2022 had the same cognitive ability as a 53-year-old in 2000. That sounds made up. It does, doesn't it? So they're also saying this means, so people who are employed at 70 see a 30% uplift in earnings. But think about how many people are still working into old age now.

I mean, the fact that it's a 22-year period or whatever seems almost, if you would have said in 1950, I don't know though. But this is my point of some people who aren't, there's a lot of people out there who are not prepared for retirement. Their solution is going to be working longer because you're living longer. Yeah. And your brain is staying sharper longer. Duncan is saying that according to various market research reports, the market for US self-improvement is $16.5 billion. It's a lot of coin. Yeah. All right.

I'm going to do it. I'm going to start just podcasting shirtless and going for runs all the time. And let's do it. All right. A bunch of people confirmed for us. You can book Grand Hyatt Baja Mar using Hyatt points. Michael, it's still there for you. They also said... Hang on, hang on, hang on. There are blackout dates. Yes, there are blackout dates. So for Christmas... They said there was a certain amount of rooms. Christmas, for example, you can't use points. Unless I was told... I was... I called them and I... That makes sense. I complained and...

They also said that if you use the Hyatt points, it's a really good credit card because there's no taxes or resort fees with points, which is pretty good because those resort fees are ridiculous. It's so expensive. All right. What? You're trying to talk me out of it because I feel free. No, it's phenomenal. Twist my arm. No, no, no. It's a great time. All right. Lucas Shaw tweeted, Netflix's share of TV viewing is flat from a year ago.

YouTube group by 3%, excuse me, more than every other streamer combined. My kids are on YouTube a lot these days and I don't love it. They're just watching garbage. Yes, I've been thinking about this a lot. My kids do the same and I just think about this stuff. I've been saying no YouTube a lot. I have too. We're putting limits on it now. But I look at some of the stuff that I grew up watching, cartoons and stuff, and I just, is it really that much worse than the stuff we grew up on? I don't know. I think so.

I was watching Spider-Man. That taught you how to be a man. And I don't know. Spider-Man was a life coach. Or Ant, what's the uncle's name? With great powers comes great responsibility. That was Uncle Ben. Yes. That sounds like something a life coach would say. Yeah. All right. So this is the article that I shared over the weekend or on Friday, Ben, that I think you called me out for. But the article was in the New York Times, a reputable publication in the eyes of some people. Why is IMAX suddenly everywhere? And this is the lead.

Tom Cruise had a major request. He wanted IMAX to show his latest Mission Impossible movie, and only his movie, on its giant screen for three weeks. It is the kind of exclusive run that few films get. So, Mr. Cruise went straight to the top.

He reached out to IMAX's chief executive, Rich Gelfand, who had some requests of his own. He wanted all the Mission Impossible premieres, along with press screenings and influencer screenings, to be held at an IMAX theater, and he wanted Mr. Cruise to endorse the company's screens during his global press tour for the film, which opens this weekend.

Did he also want to teach him how to eat popcorn? Holy shit. The viral video of Tom Cruise eating popcorn. So he ate popcorn like how some people eat peanuts. And I think even that's weird eating peanuts, but whatever. I'm not here to judge how people eat their food. I guess I am actually. That's a lie. I am judging. When you have your handful of

or popcorn or whatever it is. And you just, I guess there's a hole over here. You just throw it in. It's just weird. Who does that? I've never seen anyone do that with popcorn. It was very bizarre. Okay. So IMAX relented and gave him all his demands or they each gave each other the demand? I forget what it said, but last night I went to the theater, saw a 710 showing. I got there ready to get some popcorn and I oscillate between a Sprite and a Diet Coke, depending on my mood.

That's the only place that I drink soda, actually, for the most part, is at a theater. And the line was ridiculous. I almost took a picture for the show. I didn't, but there was, I think, four registers that were open, and I bailed. I said, I'm going to miss the movie. And then I tried to come out of the movie. So the show was at 7.10. I went in there. I got there at 7.05. I went in there at like 7.25. I'm like, I'm on line for 20 minutes. I tried to come out again. The line was still so long. So they captured...

I got an email from IMAX over the weekend. Even on a Monday night, huh? Well, it was a weekend. All right, so the numbers were IMAX kipped off the summer in record fashion, $31 million in box office for Mission Impossible, including a stunning 20% of the domestic. 20%, and it's probably 1% of theaters. It's wild. That is crazy. So if people are going to get out and go to the theaters, they want a premium experience. That's your selling point, right? That's exactly right. Okay.

This is from the journal. It was a blockbuster Memorial Day weekend for Hollywood led by a little blue alien. Disney's remake of Lilo and Stitch topped the box office with an estimated $183 million. Mission Impossible did $77.5 million. All told, domestic ticket sales totaled $326.7 million for the holiday weekend.

the prior record not accounting for inflation was $314 million in 2013. So this is great news for the theater, for the movie industry, because the first quarter was garbage. My kids are excited about Lilo and Stitch. I'm sure you're taking your kids to that one. I am going to take them. Yeah. So this is crazy. We talked about the drawdowns with individual stocks earlier. After the dot-com bubble... IMAX probably fell, what, 95%? 98%. Yeah. And came all the way. It's one of those stocks that did come back. Now it's still in the 35% drawdown from the high in 2015. Yeah.

You got room to run here. I think so. All right. I've got a question for you. I want to know if I'm a curmudgeon or if I have a point here. You're not a curmudgeon. Dude, instead of honking at the car next to you, you climbed out your window. You're the opposite of a curmudgeon. Okay. I didn't say anything, but this is in my head. So...

So breweries have figured it out, right? If you want to get like millennials and their kids there, you have to have the beer and the food, but you also have to have like games or an outdoor spot for the kids so the kids can play while the parents sit there and have a beer, right? So I frequented two breweries this weekend and waiting in line to get a beer. At both places, the same thing happened. So it stood out to me. The people in line in front of me, and there's a big line of people behind them waiting to get a beer, right?

They ask for a taste of a beer before, like one of the little cups. No, sorry. And they taste it and they sip it and they go, and think, and think. Yeah, that's pretty. You should not be allowed to taste a beer before you order it. I'm sorry. You can't order food at a restaurant and try it and then send it back. You're 100% right. Right? Like you shouldn't be able to do that. If you buy a beer and you don't like it,

You're out seven bucks. Well, guess what? Drink it. Throw it out. Get back. Get a new one. Think, yes. This should not be a thing. I would tell, if this was my bar, I'd say no. Buy the beer. Don't buy the beer. One of my strong points, I'm very courteous to others around me. I'm a very considerate driver. I'm a considerate walker. I'm a considerate line attendee, line cure. I care about the person behind me. That's an inconsiderate act, right? Yeah. Especially if someone's behind you. It's very rude. It's very rude. Thank you. I always had the beach this weekend talking to my Cabana boy.

And I was asking him because he told me that he went to the beach club next door growing up and I worked there. It just sounds weird to say that you have your own cabana boy. That doesn't sound... By the way, growing up, I knew one person that went to a beach club in my town. And I'm sure there were others, but I knew one. I visited once or twice growing up. So now everyone has one. And a beach club is just you have your own cabana and there's a pool there and a restaurant and stuff? It's great. Okay. So I spent maybe five years as a cabana boy.

I think from like 16 to like 20, something like that. So I was talking to him and I'm like, oh, you were in the sand court. And I'm saying to Robin, I said, because Robin and I met at the beach club, I said, who was the Cabana boy in the sand court in 2002? And he goes, I was born in 2006. Yeah, high school job. So do they work on tips essentially? Yeah. Is he going to get a tax break? Ooh, that is a good question. Hey, you ever been hit by a car? No. I got hit by a car last week. Okay.

Like a bump or a hit? I would say it was probably in between. Well, no, I didn't get hit. New York? I'm surprised more people don't get hit by cars in New York City. Yeah, so I was crossing the street. AirPods in? No, I was walking with a friend and she backed up into me because I guess she was too far into the crosswalk. So she backed up into me like, where are you going? You're on 7th Avenue. And it hurt. She hit me in the arm. Did you hit the car? No.

Like, hey, boom. No, but it hurt. Did they know they hit you? Yeah, she was like very apologetic, but she was only going, you know, four miles an hour tops, but it actually hurt. So can you imagine getting hit by a car going more than four miles an hour? Was it an SUV or a car? I don't remember. Okay. That's kind of funny, actually. So, all right. Mission Impossible. Dead Reckoning. Is that the name? You saw the one before this, right? Wasn't it one before it called?

Ghost? No. I thought that was Dead Reckoning. Is this Dead Reckoning? What was this called? I can't remember. God, I'm old. Oh, The Final Reckoning. Oh, The Final Reckoning. The other one was a Dead Reckoning. All right, so the movie was- The last one didn't get great reviews, but I still liked it. I enjoyed the shit out of the last one. This one, however, all right, I had a great time. Now, I've said this before. Actually, I feel like I've said it the last three weeks. I have trouble following plots, especially in action films, which is sort of their besides point, but this was so convoluted

Like the story made no sense. Not that it matters to the, to the movie going experience, but it was so disjointed. Um, I'm excited to hear your take on it, but some of the, some of the things that TC did were just unbelievable. He's a maniac. Unbelievable. Like the peaks of the action scenes were as good as it gets, but it was, it was, I mean, there was a lot of fat on the movie. It was two hours and 49 minutes. Yeah. That's long. Um,

Because the last one was two and a half hours or so. Yeah. So yeah, not the best Mission Impossible, but I don't want to complain. I had fun. And when I go to a movie, I'm looking for fun. Oh, that's a theater movie. That's an IMAX movie. Not trying to talk my book there, but it really is an IMAX movie. Did you finish the studio? No, I finally watched your Ted Sarandos episode last night. I thought that was funny how everyone just kept thinking Ted Sarandos. Yeah.

That was a good inside joke. So I might have two left, I guess. All right. Well, I'm finishing up some other old shows that I'm sunk costing. So just go ahead and I'll tell you. Okay. So Seth Rogen and Evan Goldberg were on

the town, a two-parter talking about the making of and the goals. And I think that the show went a different direction than I thought it would. I thought there'd be like a storyline like through the season. There wasn't. Each episode is its own thing. Man, I enjoyed the shit out of it. Like, no apologies. I had a great time. I thought the finale was hilarious. I really, really enjoyed it. Big fan of the show. Yeah. Again, it's hit or miss for me. Like I think the good episodes are really good. The bad ones are like, eh. Yeah. But is it an hour? Yeah.

That's like a half hour show, 40 minutes maybe. Yeah, so it's quick. If you don't like it, whatever. And the fact that there's so many guest stars in each episode is... Anyway, so in the finale, Bryan Cranston, you're going to die. He steals the show. Okay. He's good. We're finishing two shows now that it's kind of like... I equate it to a good novel. Like there's a lot of good novels that start out really good and the setup is amazing and it's just hard to find an ending, right? Always. Because it's...

And so we're finishing You, which is a serial killer show on Netflix with Penn Badgley. And I think it's the fifth or sixth season. And it just went too long. And we finished it and the ending was okay. But I feel like there's no good way to end a serial killer show. It's like the Dexter went too long and didn't have a good ending. There's just no good way to do this. And then we're finishing The Handmaid's Tale, which is... I think we're up to the finale now. And it's one of these things where...

The start was just way better, and we're hanging on because I think my wife liked both these shows more than me. And it's kind of, we're finishing because we started them. Are they still making new seasons, or is it over? This is the last one. Handmaid's Tale is, this is it. So there's one more episode. And it's kind of like, yeah, these shows were really good at the beginning, and I don't know if I needed to see how they concluded. I had to because I wanted, I needed to know what happened, but it's, the quality went down after a while.

That's all I got. Markets up almost 2%. Kind of wild. Not kind of wild. Wild. It's a bull market. Stock market wanted to move higher. I do wonder if we never had the tariff thing in the first place. If Trump just said deregulation, tax bill, would we have had another 20% up year this year? Yeah. God knows. Maybe we still. But that seems to be, maybe that's the baseline. Not saying the market is even a year. Stocks will go up 20% every year unless something bad happens, says Ben Carlson.

No, in a rip-roaring bull market with a lot of animal spirits, I don't know. Maybe the baseline for this year was a 15% or 20% up year, and the tariff had pulled us back from that, the tariff stuff. It really is kind of incredible how much of an about-face there's been. It seems like, of course, it shouldn't have been a surprise, but it still is kind of surprising for the rhetoric we heard in April, I think. All right, what else we got? What do you mean?

In general? In life? Yeah. Summer? Can you believe how fast summer went? That's a preview for 12 weeks from now. So on a year-to-date basis, the S&P is now up 1%. We're back in the black. All right. AnimalSpirits at TheCompoundNews.com. Thank you, everybody, for listening, for emailing. We'll see you next time.