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All investing is subject to risk. Vanguard, Marketing Corporation distribut 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 Ridol's wealth management. This podcast is for informational purposes only and should not be relied upon for any investment decisions clients of Brid Hol'salth management may maintain positions in the securities discussed in this podcast Welcome to Animal Spirits with Michael and Ben G got an email, subject line, Miami Vice drinking technique and I want to open the show as we head into the warm summer peak Miami Vice season. Somebody wrote, Hey there, I'm at the shore in Vacation. and I think to myself, What's a popper beach drink I of course, think back to the mini podcasts where Benn is enthusiastically pushing Miami vice They bring me a drink that has the collotte on the top on the bottom and the dakqui on the top. So what is the proper way to drink this thing? Am I supposed to start and mix it all together? Use a straw to go deep. it's like a collada, then rise up and drink the daiquiri No straw, and what say you? That's great because I read this one and I thought, man I have to think really deeply about this because one place in Marco Island that does a side by side I don't know I don't think put a little Cardboard divider in there. and they do the peny clod on one side It's gott to be a a side by side machine, th, that poison both at the same time Oh, there you go. that that's that make more sense I don't stir. They thought they put a piece cardboard in every drink Yeah yourour way probably makes more sense Uh I don't really stir. I just I drink as it is. and the best people know how to do a swirl or something to kind of blend them. the right way. Anyone who made slurpy with multiple flavors knows how to do that. I go just straw in whatever I play the field as lies like shoot him Mcevan said But it's usually the one than the other. Although I'm not mad or if somebody wants to start up. Like thats probably that probably works just as well. I've never done that, but it probably would make sense. But it looks prettier if you don't stir it. so that's thing. It's all about the looks. And you got to a pineapple on top and obviously the floater All right We have a ton to get to today. I'm excited about the show today. We have a million things to talk about forty eight pages in the dock Let's this could can be a Tarantino movie essentially Let's talk about leverage. This was a story in Bloomberg Fomo really got me Taiwanese go deep into debt to amp one hundred percent stock rally. So there's all these stories about South Korea and Taiwan And this is the Jesse Limore quote. I'm going to butcher it, but he says nothing is new in the stock market. Everything that has happened before will happen again And what he means is there is nothing there is nothing new under the sun I believe it was G Andy Chiang is twenty six unemployed and with the help of a little borred money, the proud owner of sixty thousand dollars worth of Taiwanese tech stocks And in many ways, he speaks for the entire island of twenty three million people when he doles out the following advice, buy any stock and you will make money U they look at this chart they have in here of stock leverage in Taiwan that has just gone absolutely vertical Many of the island's brokerages have hit their internal limits on certain types of loans, forcing them to demand more collateral and bump up their rates according to people familiar with the matter. Like the brokerages are saying like, okay, this is this is getting a little Scary here, right? simimilar in in South Korea. and Taiwan is now the fifth largest stock market in the world. Bigger than India Bigger than Canada B bigger than the UK which is just mind bogging. I'm sure you could do it have I do some sort of This is the population, this is the land mass, this is all that stuff. So that's Taiwan and South Korea I think is doing me something similar Then yesterday in The Wall Street Journal the trillar barrowing binge lifting the stock market to risky heights And they highlight the fact that there's a ton more money in leveraged ETFs which we've talked about before, that just keeps going up and up and up because now you have single stock ETFs Double, triple, every new thematic has to have a leveraged version My original thing, we talked about this in the research channel yesterday, we had a lively debate And I said, listen, if you look at the history of the margin debt stuff It just kind of follows the market. Jake Hugh, who actually blogg an economic. I don't think he does anymore early days of Fancial blogasy He said, lookook, if you put a chart of margin debt in the stock market, They're concurrent indicators. They're not leading indicators. And if you do it as a percentage of the index, it's kind of. similar over time This in twenty fifteen is we're not in Kansas anyore twenty fifteen, But the point was those relationships still hold So I updated the data Market goes higher, margin debt goes higher Right? And as a percentage of the market cap, it's still veryer similar. You said I'm actually kind of worried about this Yeah, I think this is a dated indicator. So in twenty fifteen people Jake wrote this because it was like non stop margin debt stuff. And I agree at the time it made a lot of sense to normalize things because At that time in twenty fifteen, which is a million stock market years ago margin debt, traditional margin debt. was the way that people levered up their exposure. And the point was When the market hits all time high, so is margin debt. So people saw margin debt hits new highs and people go, oh no What does that mean I am concerned about leveraging the system. I'm not concerned to the point that I think like, oh, no, go to cash But I think to like not at least be aware of what's going on is put burying your head in the sand So I had a chart can make a chart showing What is the what is the year over year FINRA margin debt change And it's up fifty four percent year over year. which T Ben's point. Well yeah, the stock market's forty two percent over year Like it makes sense directionally that they move together and they do The thing is The last want this another fourth time That margin debt since nineteen ninety seven has risen by fifty percent of more yourVR. and let me tell you the other previous times two thousand two thousand seven twenty twenty one twenty twenty six All right, we need to have the cover, the thumbnail for this YouTube video be fire behind us because that is Heresere's where my worry would be. My worry would not be like, oh gosh, this is a generational top because of all this debt. My worry would be, there's going to be air pockets in the market. But we're seeing them. You saw them you saw them last week and even yesterday. I think Microon closed down eight percent ended up the today one percent. You're seeing a lot of You're say, I think Micron has been up or down five percent or more on the day for the last seven sessions in a row. The tail is starting to wag the dog. This is one hundred percent being pushed around by leverage This is why those South Korean stocks and Tiwanese Taiwan semiconductor They can be down ten percent in a day easily, twenty percent in a day potentially because of all this leverage. That's the worry is that you're going to get an air pocket and then selling be gets selling. That's what happens. So FinRA margin dead is boomer margin debt That doesn't show, no, seriously, that is the way that people used to lever up theirir portfolio is back in the day And there are all sorts of instruments that do not show up in this chart. So swaps, for example, that's how ourcagos blew up. Nobody knew because this' like There's no record of this and Options. Options and futures. These So I think a lot of these double things run on swaps. That's not in the system. Now we saw the chart What is it two hundred billion dollars worth money in there? That's That's nothing U box spreads and other synthetic lending is not in here Now obviously that impacts a lot of wealth management clients. It's a little bit sort it's a different type of leverage because Yes, people are levering up their portfolios, but it's not to buy more stocks. That's the thing. notot all leverage is being used. sometometimes it's used for house down payment, Sometimes it's used for renovation. It doesn't always have to go back into the market But yes, but to be very clear, let's like not mince words There was a lot demand for leverage. there is a lot of borrowing in the system And yes, it does have my intention and I am a little bit worried about it. This is one of the reasons though that I've always said on this show And this doesn't cover it's not a blanket statement, but interest rates matter way less than people think because rates have been going higher People are still borrowing money So go from this stuff. So that that's surprising to me that rates keep going up and people don't care. And this is what happens though in a bull market Well who's weing more and more and more risk? Nobody cares noobody cares about the annualized interestnterest expense when you're trying to make twenty percent in a day, who cares So there is so much demand for borrowing then the brokers only have so much money that they're willing to loan out And there was a cost to this capital. And right now costs are skyrocket. But there's this idea that the Fed can control people's behaviors through interest rates, and I just don't believe it Behavior matters more than rates. Well until rates get to a certain point Rates matter in the sense that they slow down the economy They slow down growth, which eventually not overnight, but definitely hits. Obviously going from zero to five, that had a huge impact But not as much But here's the thing. I would be more surprised if people weren't levering up right now, given where given that the way this cycle is playing out Of course this is happening. Boom, a huge boom cours is happening of course it's happenppy. right. I don't think I don't anybody's surprised like why people takeaking leverage? Well, becausecause he' stocksing all papers every day. and And of course it makesense. Um All right, Coreory Havstein tweeted this chart from M Who made this shard? don't know. It's Boomberg' compil by citel securities, Okay? The combination of concentrated positioning growing buy side leverage demand and constrained balance sheet capacity has begun to tighten funding markets. pushing a one month equity financing spreads to as high as a one hundred and thirty eight basis points above sofver U Prime brokerage, like hedge fund leverage does not show up as far as I know in Finra margin debt chart that we were mentioning So yeah, people are speculating their assholes off And can this will this cause moreore volatility. Um, you know, a a a micron coming down twenty seven percent in three days. Single man volatility to me would be' the risk of that is way biger and it's been It's growing. All right. so that that's kind of that's obviously something to worry about. That's not a Again, it's not a nineteen twenty nine situation By any means, but it' You're right. It's got to be concerning at some point that we could see big air pockets from that. How about this for good news? Small caps this year. Russell two thousand as of the close on Monday was up twenty two point three percent, S andP up seven point a fivealf percent This is a huge, huge weat. So I took all of the Russell two thousand stocks Downloaded them from my charts uploaded at to Claud. I said, what's going on here? Why What's going on with the The stocks and the also to two thousand Breatadh not concentrations. sixty seven percent of the names are up year to date. Median return is over fifteen percent nine hundred stocks in the Russell two thousand are up twenty percent or more this year So this is not just a handful of names and obviously with with an index that big So this is this is like this is a big time widening out of the market Again, I think pretty good news for bull markarket I would a agree I would agree. U All right, look look at this chart from Lukekawa. He did this last week. The day Apple announced in the morning on Bloomberg, there was a story saying, Hey, Apple's raising the prices of everything Max iPads iPhones because memory is too expensive now. So the r I'm shocked that Apple fell six percent on the day Because of that I guess move. Why I would have thought that people think that the demand for these products is in elastic and who cares what prices? It's not going to impact sales. Well doesn't market. Maybe Apple doesn't have as much power as people thought. I don't know. But so he shows on this day last week, The memory producers Sand Disk and Western Digital and SK Heynx and Samsung gained almost five hundred billion dollars in market cap The same day, Apple Microsoft, Meta, Amazon and Google lost five hundred billion dollars in Microcaapit. It looks like a very clean transfer. This is a beautiful chart that he created here. It's a great chart Um, Hold on a not a not so subtle, I mean, a not This is not a footnote to that story. That was the same day that Micron reported earnings. Right. Micron was up sixteen percent. and it would have been up sixteen percent regardless of the Apple announcement. But why did Micron have such good earnings because of the CapEx from the hyperscaales. My question is how long can they let this keep happening Wh's they The hyperscalers saying We're going to lose and you're going to win. And're we're basically powering your world. This is this is like the portest five forces Tpe stuff The suppliers have all of the pricing power right now. What's Apple going to do make their own memory stuff. sllow their CapEx eventually. Are they going arere they going to all live with thirty percent declines or forty percent decles? Apples not the one spending the money I know. it's so This other Tracy Alllloway chart went viral from Nomura. showing that the hyperscalle free cash flow projections is essentially going from, I don't know, seven hundred Billion to effectively zero over the next twelve months And this is Amazon, Microsoft, Google, Mad and Oracle. I just think we're getting to the point where we're testing like the metal of these the intestinal fortitude of these CEO's to stick with us They keep saying, no, we're going to we're going we don't care. The bigger risk is backing down I just think it's really interesting if they're going to power these memory producers higher and our stock prices is going to fall. How long can they handle that for F from a human perspective, the Don't think the employees start going, hey Our stocks down forty percent This stinks Now on the other hand. You being a stock guy What would you rather have right now buying stocks today for the next call it three years Would you rather own Meta, Netflix, and Microsoft or Sandisk Western digital Micron It's not even days. It's not even close The hyperscalers That would be the The way that I'm sure most Micons up micrononss up fifteen hundred percent in the last year and a half, justified Microsoft has underperformed the S and P since twenty nineteen and it's down thirty five percent from the highs. Yeah, this' is not a hard question. Now for the next three months, six months, Yeahah, probably probably the memory stock. This is why owning a momentum portfolio is so hard Becauseuse the moment answer would be no, you double down on these stocks that are continuing to go up That's why it's hard to do Plugwite, it works too for at least of time I bght microsoft. I brought mroself yester As a guy who keeps retiring from his I bought Microsoft and and Netflix and I said, Close my eyes and look at it again in five years We own we own Sandisk. We own a lot of these stocks in our porter house momentum strategy. Yeah lester We bought Sandisk at like three hundred bucks And then a few months later, we bought more at six hundred twenty five and I was like, what in the what U but that's part of the reason why momentum works. It does what the humans can never I would never do that. Are you kidding me? If I bought Sandas at three hundred, I'm selling it at three hundred seventy if I'm luck That's why to me, I have to a few people have asked questions about the strategy like Why do you do this if you're like a booglehead person? Like I will never buy these stocks in my life. I need to have rules based. As long as it's rules based, I can stick with about it. Here's the thing I would never be able to put my own money into these individual stocks and stick with them. But if it's a rules based thing and it's a process based, and it's the factory you're investing in not necessarily the companies that like that to me is emotionally easier to invest in hundred percent Some people can handle the individual stocks. I can't. So I think that I think that the market is acting very rationally As insane as it seems. with the memory stocks Micron's earning since january twenty twenty five are up fourteen hundred percent. The stock is up fourteen hundred percent It's rational free cash flow productions for these hypersalers going to zero. The company is getting rerated and now traded a forwardPE the same as the market rational Everybody The idea when this started was these hypersalers are spending money and they're just going to be the biggest monopoly in history. Yeah it's not working out like that. That is you know surprising outcome. It's so Awesome to see the narrative' changing over the years because prior to The AI error The question was can unseat Like there's not going to be another search engine. Yeah. There's not I belie to them. Google did. They don't even them he Maybe But yeah, yes, like we were thinking like, what's which one of these stocks would not be in the N seven And in no world could we have foreseen a universe where they're Th hundred billion dollars worth of free cash flow goes to zero Nobody could have predicted that So here we are in twenty twenty six where everything is out performing the Max seven Look at this chart that Matt made. We're looking at small value, small growth, mid growth, mid value, everything really divided by the Mag seven Everything is outperforming it. too me This is such healthy ull market. This is an everything rally, X Mag seven And it's everything you want to see So if you step aside from the circus Push the leverage conversation to to the back burner for a second. And you say, well, what's rallying Transports Iustrials smallall caps regional banks If you are purely a technician and you don't know anything about the fundamental story of what's happening For forget everything, just look inside the market You would say Holy shit is this bullish Crazy. Um All right, we were we were on Dark Thompson's podcast Drk does a good job of synthesizing A lot of the stuff that we're talking about, the biggest stories And then we talk about it and he holds her feet to the fire a little bit. And he said at the end, like, listen doing the both sidesing. what do you think Right now, is this a bubble And we both had the same answer We both said heres here's why. I didn't say this to Derek but I've said it before. I'll say again can Memmory stocks fall fifty percent. Yes Will they Yeah, probably they probably will at some point in time. Will that have proven it's a bubble No The way that I think about a bubble is there is It's a cockail of things. You need to have all these things Speculation being the first obvious one. is there speculation Duh, yes, of course, there was But too me, it's about the fundamental valuations Like there has to be that is the underpinning of a bubble. in which V. Multiples that investors are putting on stocks There is no there is no universe. in which the stocks can grow into fundament valuations Like you roll the dice a thousand times and a thousand times, they fall short What Nvidia is training at twenty four times forward earnings Is that expensive? Yeahah, fine. I don't, whatever But is it a bubble? Is the market in a bubble? look what the market is doing to the hyperscalers It's debbling them. It's saying no, you're, we don't like this. We're going we're going to we're going to re rate you lower So I don't I think that this we can get to a bubble You know, like we can debate about whether we will enter a bubble But are we in a bubble today That's going to burst and fall eighty percent to take everything done with it I don't really say it even th even though I'm blind, I see a lot. The F' definition was no reasonable future outcome can justify current prices that's a bubble I would think it would have to like could we say that's the dork academic way of saying what I just said. It is. yeah, yeah. But so my definition is W the NASA one hundred fall fifty percent or more To me, that would prove this was a bubble I don't think that the market is going to allow that kind of buying opportunity with these stocks and this opportunity That's why think this is not a b. Well, then count for fifty percent Yes. I think if that happens that yes, this was a bubble If the NazAq falls thirty percent, we get a bear market I don't think that constutes a bubble. What about forty ' gray area. I think it's gott to be fif. For for it to be really like all the bubbles that people are putting this in the same classes, com the railroad, all these things This has to be fifty percent if that's going to be in that class of bubble And fifty is like light But the backc was eighty. Well eighty. Yeah. Yes. So if if it falls eighty percent. U the world will look a lot different than it does today. I just seeing know for anyone. I know you could say, hey, listen, these earnings numbers just their They're going to go away because all it is is the hyperscalers is taking all that free cash flow and it's going into earnings of other companies That's a I think that could be a fair argument if you wanted to make it Yeah, but they're all saying the same thing And I know they I guess they can all change their mind together But even on Micron's call, they said. We thought that this was going to go through the end of twenty twenty six. Now we see it going through the end of twenty twenty seven The demand they all wrong like is are these hyper sailors going to rug the entire stock market. I don't think so I've neither. I'm say it could happen I think it could happen Um Okay. So remember the whole basasement ideea and the end of the dollar We talked about this Bloomberg story little bit with Alex Morris. He's from FM invvestment's going to come on soon. But Michael Sembas and his latest piece had all these charts And it's funny because people keep saying that the dollar' ending and no one wants to invest in the US anymore And he's saying, look at all the government debt data Places like China are worse than us So if you think that the dollar is going away. giveive me a good somethingomething that's going to step in Guess what? It's not crypto. It's not The rememi, it's not one of these other currencies. What else is going to replace the dollar if the dollar is going to fall from its status Reserve. That's the thing. There's nothing. or no replacement He says it's eighty nine percent of FX transaction volume right now eighty nine percent. You may have your problems with the debt and the deficits of this country It's just as bad ever else It's the problem. Governments around the world are like the hypererscalers. They all win in this together this decade Everyone increased their debt by an insane amount This was the mic drop. this piece. Sorry it's not happening. You can Scare people with all your debasement stuff and dollars and deficits and this is the end of the world and Romea iss falling great story is not happening Try again next time Oh, he had this really good charting here too of how the US is at the lower end of concentration by country So the only stock markets that have lower concentration, their top ten companies than the US is Japan and India. Everywhere else has much higher concentrations Canada, UK, France, like these their stock markets are all more con more highly concentrated than the U.S.. I think this whole concentration worry for the last Really ten years or so It really started like ten years ago. I wrote my first blog post in twenty seventeen. about people worried about stock market concentration. I really think it's been one of the dumbest worries about risks that we've had. This is just the way the stock market is Um, I understood the risk and the worry. I think that if you're still worried about it, you just have to I'm another happy you play the field ast lies This is what it is I forget where I pulled this chart The I is Johnuth's actually Blo Um, It's global, as we've said a million times They showed the average market capit of the top twenty stocks in the MSCI. All country World index It's now sixty times bigger than the average stock of the remaining twenty thousand five hundred stocks And this doesn't This doesn't look like a cyclical or This is like a structural change in the index in the world. Right? We all know like the balance accus to the winners. So I asked Ch kid U to recreate something similar for the past Five years, we've been looking at the Mag seven as a percentage of the mark cap And by the way, I saw a chart the, you know, Goldmanax is a chart Max seven percentage of earnings, percentage of market cap. And they've of course they've gone up to the right together the Market cap has outstripped the earnings a little bit That gap is now completely closed. So they're thirty eight, whatever percent of the index and they're thirty percent of the earnings. Allright, anyway. So if we zoom out because now there are a lot gigantic stocks in Micron. is a trillion dollar stock Broadcrom. like there are a lot of gigantic St. it's no longer the Max seven So I asked Matt to look at the top twenty five percent. I'm sorry The top twenty five stocks rought the universe out a little bit So look past Mag seven, let's go to the top twenty five twenty seventeen For example The top twenty five stocks were roughly forty percent of the market. They're now fifty four percent And I'm guessing There's Five of them that are the same, maybe. since two thousand seven. If this were to return to forty percent I would think it would have to be because they're falling Not because the rest of the world, not because the four hundred seventy five is like growing that much The concentration usually goes down in a big bear market, right All right, so because of the concentration All of the Breath data is permanently busted There are there is weird things happening inside the market whereere this data point like, oh, this has never happened since B blocking breath for the civilians out there. Does not matter anymore. So the SAP five hundred was up ninety seven basis points Only one hundred and forty stocks were up. That would be weak brereatadth. It's being led by fewer, fewer stocks you want ation. People are look at a ratio of addvancing stocks to declining stocks to know what You want want the advanced decline line to keep going up to confirm the rally. All right, so forord so Kevin Gordon tweet The third straight day with the S and P five hundred declining. yet the advanced decline spread remaining positive Bespoke has a couple of chots in this showing the rolling number of days with price and breadth in opposite directions prices up. And more than half of the index is down So that means that the Mag seven is down, but the rest of the stocks are up, essentially Basically or Or at this point, it's not just that. It could just be like the software names because the software names are now big enough where they could power the index higher with negative breath and vice versa Right. So you're a lot of these historical charts they're busted. They're going to need a lot of context. They're busted. They're just busted So they show the they show rolling fifty day periods, hundred twenty day periods, and two hundred day periods And we've never seen anything like what is happening now Um, so any like historical data on this, Just is completely useless. another shart that to me really epitomizes what sort of weird market envonment we're in neegative beta This is from UBS. They have a chart that shows the largest one thousand US companies by market cap and the number of stocks with a negative beta to the SP five hundred I don't know if this is like thirty day periods or whatever they're using. Oh, here it is. two today. So a negative beta means that stocks tend to go down when the index goes up. That is bizarre And prior to twenty twenty five the line There was no line. It like happened like a few times where ten stocks would have this, like ten And now It's one hundred and eight All right, so the previous record looked to be around ten. I'm just eyeballing it maybe even less And now it's one hundred and eight. Now that is a combination of the energy stocks and the war in Iran. When there was peace talks and crude oil fell nine percent And energy stocks fell and the index went up. There so there's that baked into it And of course, there's all of the semiconductor trades. The all the AI stuff, all the hyperscar stuff So the market and breadth dynamics Look very very. The twenty twentyies have broken a lot of historical relationships in terms of economic data. Economic charts Stock market data is a brave new world We we u We should have covered this chart earlier when we're talking about the debasement traade, but This is my favorite chart that Smbol has made We've seen a lot of charts showing central banks gold allocation as a percent of their total cash reserves. People have been saying that's the reason gold has been going up for so many years because of Rroanks buying it Exactly And is that part of the story? I suppose, but looking at this I don't know if there's like start date that's moving this but Michael shows The actual goal shares of World FX reserves, again up into the right But he makes the astute observation It's a price thing Yeah, when gold goes from two thousand to five thousand five hundred, Of course, it's gonna be a bigger sice of the pie. Are they actually Buying gold to the extent that these charts suggest no. So he shows If you assume the actual holdings And no change in gold prices this march two thousand nine They have less than they did in two thousand nine So Gold right now is in a twenty five percent drawdown. So that means that that percentage is obviously gone down because the price is gone down. Silver iss down fifty percent from the total from the high. U, pretty wild unwind. Last thing on the on the market stuff and then we'll move on couple of good charts from Torson sllock He's showing earnings growth converging between the Max seven and the S andP four ninety three So in twenty twenty three, the Mag seven grew thirty four percent. the four hundred ninety three was down Three percent, of course, that was well documented R? Like that's all we were talking about twenty twenty three because it was the reality. that the entire market was being led by the by the Mic seven that persisted in twenty twenty five. twenty three and eleven But in twenty twenty seven Analysts are expecting nineteen percent growth of the Mic seven and fifteen percent for the four ninety three whichich would be a wonderful development. So this be that would be three years in a row of double digit earnings growth for the four hundred and ninety three One final thing on Nvidia is cheap, and I'm gonna to use air quotes on Nvidia is cheap. If somebody is listening and they were yelling through the screen Michael stop saying Nvidiaious cheap red that it's trading at twenty four times forward earns because we've actually we did this a couple monthso, a couple of weeks ago It can have a premium multiple because it's too big. It wouldn't make sense if it would swallowed the market. That's fair. I would accept that rebuttal. Nvidia has a larger market cap Canada than the UK than France, then Germany and then Italy So maybe we werere just bumping up against the loss of how big a company can realistically get Anyone in your life who doesn't know how to pronounce in videoia? L everyone has that person in their life Yeah, a lot of people say in the video a liine on market professional innd the video It's like someone who says shortal day in such a bold way Everyone has that person in life, they just can't get the pronunciation. I have those words too. Yeah, you say we all have them. You say Dram It's D RM It's D RAM But we all have those same a specific use case, but yah U, All right. Um, Okaykay Paychecks reported last week, I would think that paychecks is a pretty good read on the state of the Um, labor market, would you agree This is from the CEO. I would say the macro environment, despite all the potential challenges that we have going on globally around us has been stable, no signs of a recession. In fact, if you look at our index, the last several reports have actually shown an increase in index under fifty We continue to see good growth U Lows, our core customer is a homeowner Wait, there's another one. My mother. She says loles Like LOL LOL Z Balls. Yeahah Lows? I' of lows. She can't she can never get lows. Oh, lows. I think you meant lows. My mom is very bad at it. K knowing name. So she shes the las So Lols says that their their core customer is a home ownowner with an average annual withith an average household income north of one hundred thousand dollars They have gainful employment. they receive wage increases, they have record equity at their home They have money in the bank. Overall, we describe it as a consume with a really strong personal the balance sheet And this consumer is resilient You could say that every year for the last five years. It's funny. The word gainful pick az here. That's the word you only here for employment and for employment. You never use word gainful for anything else besides your gainfully employed. The next thing here, you and I both put this in the dock And so Im just one m together Yes, this was a viral thread by I think Matt Lebronch's brother, Brian Lebonch from PNC Like, who' Matt the Blanc? Was that an actor Nice from friends So's So he's from PNC and he says they track the debit and credit spending trends of four million households And he says long story short, lower income spending balance sheets, trends have been on a tear in twenty twenty six. This is is a shred a bususter. Whent you go through someundbody Okay. so he breaks out the lower income, middle income and upper income. The year over year changed in card spending Ex gasoline Right? So is there some inflation stuff going on in here? Of course there is The shape of the lines is what's interesting. because upper and middle income is dipping a little bit and lower income is straight up into the right U And it had dipped for years heading into like twenty twenty five and now it's gone vertical So he plots, he plots the gap between the upper income and the lower income And that peaked in what twenty twenty five or so and it's gone It's collapsed pretty dramatically from four and a half percent spread down to one and a half percent He said, where does this leave us U, I'm encouraged by it. bigigger tax refunds lower withholding taxes improving job growth and people monetizing wealth gains by bringing more cash into their checking accounts from theirk brokerages. haveving been more enough to keep spending stable in twenty twenty six. I gott to be honest, this the data he provided here was very surprising to me And then he concludes with this, M too He said, hereere's where it gets interesting We're also not seeing any evidence that lower income households are dipping into their savings to maintain spending patterns If anything, lower income balance sheets may have improved through the war with Iran, Iran. This is wild to me So he's looking at the cash savings buffer days for lower income households And he says it shows the median number of days a lower income household in our datas set can maintain their spending trends If their income suddenly stopped, it's still above pre pandemic levels He said that being said, lower income households are burning through their tax receipts, their tax refunds more rapidly than last year Not sure. I mean, this is just the data He's not he's not doing like commentary or anything like that, but u sururprising. I I think some people assume when you think about the case shaped economy or whatever People assume that these trends are going to be in place forever And the economy is dynamic It's constantly it's never the same constantly changing It feels like a weird position Nobody wants to hear that the lower shape of the K is doing well becausecause almost by definition, how can they be And obviously, the bottom ten percent is never doing well by definition. This is, you know, this is encouraging. It is where it is. think this, I think one of the big reasons is I've showed On this show time and again, that bottom fifty percent there their increase in equities this decade. It's like a three hundred percent increase in ownership of equities. I think that helps it's like wealth effect for for the bottom half that they've never had before really Part of part of this next chart. show is the Cash held by households And it followed a trend of four point eight percent or followed a pretty good trend line from twenty ten to two thousand And then the pandemic broke it, obviously with fiscal policy And I think everybody assumed that this gap was going to close, that the cash held by households would revert back to trend So part of the story here is On the other end of the spectrum, the number of ultraalth wealthy individuals Were talking about people with a net worth thirty million dollars. So the joural wrote piece on Jump by fourteen point four percent last year Obviously the stock market, you know, drove all of that. There's five hundred fifty six thousand eight hundred and fifty people worldwide By the end of twenty twenty five Fastest pace of growth inince twenty seventeen, againain, it's a stock market story sixty thousand people. The top zero point zero zero one percent of people. are each worth at least two hundred fifty four million dollars U population that can foot fit in a football stadium own three times more more wealth than half of humanity combined. Holy shit. So one of the one of the one of I mean, obviously obviously I think most American listeners, us would agree that capitalism is awesome Wealth creation is awesome A rising tide lifts a lot of boats to varying degrees, obviously. But one of the One of the really gnarly side effects of capitalism baked with social media is a really nasty cocktail of disgusting wealth inequality And I don't think anybody would hear what we just said. and think like Yeah, that sounds good. I'm for that It sucks. I keep saying it. I think there's a greater than fifty percent chance we're going to have a socialist president in the next ten years Mark it down I think I think that's a real because this wealth ist Again, AI is going to make it even worse I just cllaining thatt know anything about I don't know anything about how politics works other than the fact that like Putting somebody in office is very expensive. People that want socialist socialism don't have a lot of money. Well, people don't always agree with what they do with their money. One thing I had I had lunch with a local financial advisor yesterday and we both talk about this. and I said, and we kind of talk about how are things going in the business? and I made the comment like I can't believe the number of wealthy people that there are. that we come into contact with. And he said, sameame with me. He's like, there is just so much wealth sloshing around right now from everything that has happened in this, you know, past fifteen years or whatever It's It is weird, I It' not weird. I understand. There was like a fantasy of a cohort of the population. that wants us all to come crashing down And you know, I understand the sentiment Um a bear market Inequities, a fifty percent crash will certainly fix a lot of the inequality. It'll make life terrible for everybody, but Yeah, but it would be worse for people in the lower end. off course. Of course. Well Um U All right, somebody sent us to us a while ago when we spoke about some some Tack stuff and what if I had it on my screen, so I I thought this was anaropri time to include. So in twenty five, according to the latest tax policy center estimates. forty percent of households This surprised me. I didn't realize I did not know this. orr about seventy six million tax units will pay no federal individual income tax lot that isn't this just Jeff Bezos's thing where he wants to Um This is also not awesome There was something in here about Mike So seventy percent of those people earn less than seventy five thousand dollars So the business thing I a lot, you know, a lot of that is happening, already That's why the tax refunds are getting bigger, right I don't know, this like this ' out of. I to get a quick comment on this story from the Wall Stet journal Someone sent this to us. Forget work, passive income is an American dream. And they go through all these people who've decided like I'm going to start a business I'm going to have a side hustle. I'm going to create a product. I'm going to create a service. AI is going to help me I'm sick of the nine to five job. And I just want to stand up for the nine to five job The nine to five job is okay Passive income is really, really difficult It's it's way more work. And I think that's that's honestly where the story comes down Like if you do really want to it's not it's the word passive shouldn't be there anywhere Very active. It's really hard to do something on the side Like there's nothing wrong with slowly but surely building wealth through a nine to five job Do you know anybody that has a side hustle It's a good question try do I mean, you and I, everything we've done has started as a side hustle. Not to brag But guess what? It's a lot of work That's my point Not easy do something on the side. It's just more work on top of your job you already have You're wearing pol poka dot. You know the scene in you probably don't know the scene in Wayne'sworld, where Garth says It's like people do things just like they get paid and that's like really sad and he's wear like he's wearing like a rebok jobpsuit and he's drinking Psi and it's mean for the guy who was wearing an MX hat No it's Yeah, it's true easily your most quoted movie on the show Youveorded Waynees World more than any movie that we've without doubt Atificial intellig. this happen? We talked about this with Derek a little bit. There's this subset called the exponential view and they looked at Aziz Zahar looked at the GAI economy. He said it's generated one hundred ten billion dollars in sales over the past twelve months on annualized basis that run rate exceeds one hundred seventy five billion. he's got a great chart here. It just keeps going up And this is like how much money is actually being created from all the AI spent And it's going up at a pretty fast rate It's funny because numumbers don't mean anything to me anymore Like I look at this number and I go. That's why you have to normalize it to the moon and back Right It's I'm like don't Is one hundred and seventy five billion a good return on all that capital? I don't know But I think I think as long as it the keeps going up, then you say, okay, this is somethingomething's happening here. He was saying like this is this is great news likeike is finally happening Getting back to the conversation earlier in the show about the cash flow going to zero for these companies Do we think that It's more likely that we look back in two to three years and say, can you believe didn't think that this is going to work. Like theseese guys were just like completely asleep at the wheel. They had no idea they just drove their business off a cliff Or Is it more likely that Yeah, they actually, they actually had a plan and trading a market multiple, me no sense it was a generational buying opportunity. That was my point to Derek, that these are the biggest best run companies in the world. and it could be one of the this could be the biggest folly of all time. And we have egg on our face. and're like you idiot They don't know what they're doing Come on, I don't sure I don't believe that possible. It's possible that Sundar Pachai and Satya and all these comp people it's possible that they're all complete morons But how dump do you have to beat it for that to be your base case I don't believe that U fromom Ramp Economics Lab, I love this substack, A Karazi and we've had on the show before, actually. All He says is AI actually a job maker. Firms that adopt AI grow a head countount at ten point two per percent. faster over two years following adoption Ery level headcount grew even faster at twelve percent And he's got this chart here that shows Firms with high AI adoption are seeing growth in a number of employees This is a head scratcher to me Now you could say, and you've said before, wow, this is still early I think this is a positive sign for what I think is going to happen that that's going AI is going to lead to more work You could also make the case that this is still early and the companies that are most aggressively leaning in are best positioned to these sort of risks You think that AI is going to I'm just saying create that job that's possible. I don' really positive sign We haven't seen any really huge negative signs of AI yet is what I'm saying Correct Um, not like, not a huge one that like, oh my gosh, yes, this is the end. We haven't seen that yet That anecote hasn't happened yet, Even earn the data spepecialallyty All right, u I don't know I'm sure there's been work done on this. When a company puts our name on a stadium It's usually not a great sign of capital discipline So Bayenhausen tweeted The warriors signed a new Jersey patch deal. Oh, it's just a Jersey patch. All right, never mind. Um With AI Cloud from IrN Uh, but nevertheless, costing more than fifty million dollars a year I don't know how ate's lot of c of recognition. It is U Okaykay, someone I said last week they need better names for AI. They all have to use a name. And someone says in Tokyo, the nickname for Chad GP is Chappy not bad Good. But it's not bad. All right, what's the mode here forrediction markarks? I said this last week.ike where's the mode for Calciian polymarket N Yorkimesays Mark Zuckerberg directed Meda to create a prediction markets app U What's the mom Well, we discussed this last week. I'm on record that There are a lot of examples of companies where you would say Well, what's the mode And they've gone on to do incredibly well. Now Maybe I have one example But still, one is one is an od, it' more than zero Degenerate gamblers were go whatever they' treated best And Well if Well, why would they be treated better anywhere else? The odds are the odds. Once you have the customers, why would they go somewhere else? Maybe better sign upp bonuses, but like, all right That's I just What was the mode for fan?ere's the, Drag? H's the mo' in.'s here's theat for whatever First of all, why is that the criteria for anything But I'll play you with the modotus Becauseuse the reason all the growth happening for Calelcium Ply Market is just because of sports betting. That's it s So I'll tell you what the mot is for these companies For me, I have a Fandal account And I've dabbled in with fanatics and Draft Kings But I've bet whatever I've bet on Fano, that's my personal record So I want to know what my track record is. And I had a pretty good one on the B playoffs not the brerag So I am back down to only seven cents of losses per every dollar spent. So that's the mote at least for me 's I'm not living Fandle I just when it comes to sports betting, I just don't see any any mode at all. And I feel like these are fly by night companies. There's going to be twelve more of them. HeyM Uh, well, yeah, maybe're wrong. I don't know. I really have a strong opinion Um, all right, uh Michael Saylor did Volatility, tests every capital structure. strategy remains focused on Bitcoin disciplined capital allocation Credit quality and long term value creation. This is not the onion. He actually tweeted this We appreciate our investors and we'll continue to execute with transparency and resolve Um So You and I saw him speak at a conference like two years ago. and Bapasani was interviewing him And Bob's entire body language was, and he didn't say that I was, I feel like I'm taking crazy pills Yeah. He was like apoplelectic. So I'm going to get into this tonight with Josh My thoughts I don't want to to say too much other than the fact that Strategy is in a thirty with fifty percent whatever it is. Strategy is getting killed It's down eighty two percent. It is eighty two percent. Yeah. Okaykay Thty eighty. Okay. U They issued a preferred security that was supposed to trin a par It's now in a eighteen percent drawdown, not awesome. They're selling the yield higher U But what is interesting and I keep saying this, like there are things happening blockchain stuff. despite the crashes in these companies. And by the way, a couple of weeks ago, when you told me Visa was in a twelve percent drawdown when I mentioned these names, Masterc was was at a fifty week l So I think these companies are I think strategy getting blown out of Bitcoin is the best thing that could happen for Bitcoin Yeah, I would agree I would agree. So Torsson Slock tweeted The tokenized real world asset market has grown to nearly thirty two billion dollars highlighting increased institutional adoption of blockchain based infrastructure Thirty two billion dollars is like twenty million. That's a real number So he breaks it down by U.S treasury debt That's like fifteen billion dollars worth tokenized assets credit, commodities stocks and others. This is going to be a hundred billion dollars I guess I'm just thinking of the way that could how AI could save crypto somehow and really use a blockchain. There has to be a way But u You said one hundred seventy billion for AI is not that big, but thirty five billion for crypto is big I say hundred sev the billion? I didn't say it's not that big. All right, I still just think that with all the fanfare that we heard about all the things that crypto is going to do, if stablecoins are the thing That's going to be a really boring outcome from all the things that this could fix this and it could fix this. and what have tokenized real world assets are one hundred billion Is that that's nothing Hh? It's not bad. No, listen, two things to be true. The hype was ridiculous Yes And we've paid way too much attention to it But it was also a new asset class, a new vehicle like, it was exciting oy, the fact that Two trillion dollars was created from thin air Yeah Unbelievable. Is that nothing? like Is that a fail? They invented a new asset class that people institutional investors allocated to overver hyppe, sure, but not, you know, So we talked last week on ask the compound. Someone asked, Hey, I live in North Carolina. I've got two point nine percent mortgage But the house is too small for my family. The kids are growing Moving into new one would be a six point five percent mortgage And someone and I said, you know what, if it's going to make your life better Its one of the comments that, sry' been tring two point ninecent mortgage for a six point five percent one On a much higher loan balance is an idiotic move.Quality of life is defined by the people you're spending your time with not how big of a house you're spending that time in. There are numerous academic studies that include upsizing your home. Do doesn't lead to higher overall life satisfaction. I' perfect I'm a perfect counter examxple Yes. this is why I think sometimes behavioral studies are just flat out wrong. So you did this and I'm sure you're much happier. I did this. My mortgage I went from two point nine percent To whereere am I now? fiveive, five, I think. My mortgage payment is way higher than it was my old house. like an uncomfortable amount higher But I did this for my family and for my life and to be on the water and to make lifelong memories with my kids. Now obvly obviously there's like a line. Like if you can't do it, There's finishing returns at some point and there's right. But I'm just saying like if it doesn't make financial sense to the point where like if this if this blew up my life where I wasn't able to do things because I was underwater on my mortgage payments Obviously that's an that's a of questions, He, listen I can't afford it. I just don't know if I want to Fine. Do what you want, right is this This is like personal I said, I said do it because the house is honestly something that will make you happier. It will put you in a much better mood if you're in a much happier house situation. I totally agree with that. And I think the behavioral studies on this are wrong I would say it depends, but I generally agree with you The finishing returns anyway Um are we've been talking about this, The fact that the economy continues to be as resilient as it is with the housing market in a depression is remarkable. Right There was this idea that there's a line that Housing is the economy Guess what? No. Kevin Gordon tweeted new home sales fall shply in M mayay down seven point three percent and they're getting closer to the cycle lows. and Tas Smith said It is still Completely insane, GDP has been above trend cycle of the housing sector typically responsible for the twenty percent of commercial activity has been effectively frozen. Now, it sound like a mystery like, well, what's happening? Well, yeah, it's all AI So Um Warren Pice' a chart showing residential fixed investment Um, in raw dollars. versus information equipment and software and it's just the lines have just gone whoop Guess what? most peopleople would prefer if we built more houses than more data centers. That's not where the incentives are right now Um, someomebody sent sent this article to us There was an article, an opinion piece in the FT Your summer holiday is a retirement killer and basically like if you were to invest the money instead of spending it on X, Y and Z and I think this was satire, but I'm not a hundred percent positive. I think this was like very dry British humor Did you read the artle Okay, I did kind of skim it. I didn't, I guess I didn't get that. So the whole idea was yeah, if you just take the ten thousand dollars you're going to spend on vacation in most in grow it over thirty years, this is how much your Giving up, right Yeah, now I'm like sixty five percent sure. I'm not, you know I don't know. I don't know who this person is And I think we would all agree that if you are putting an eight percent return on your vacation and depriving your family of these memories because it could be worth whatever This is Yes this is this is satire. And the thing is some people probably would look at this being real He's like that ten dollars a day you're spending on ice cream for your kids could be two thousand dollars by the time they retire The Wall Street Journal an article no hair transplants, pills or t two pes, meet the men embracing baldness. I've been balmaxing for years And I wasn't asked to opine. We got a lot of this. Yeah, someone said, Michael should have definitely been interviewed for this I mean, these these solutions are coming I mean, if you're aald person and you grow your hair back, I'm not going to look down on you I think you should you can do it. I think you I'm more party, I don't care. But Josh iss regrowing his hair somehow. He's he's injecting himself, well I heard he did I heard Josh did a speech for a group of advisors in Turkey. And then he came back. I don't know what happened good.ne more personal finance thing So it is funny because a lot of what we've been talking about in the last five or ten minutes is just judging people on their financial decisions. I think I'm not one of those person who that says don't judge people on their financialisions. I love judging people on their financial decisions Oh it's good internally, right? It's fun Yeah, we don't publicly shame but But we always get people, we've talked a lot on this show before about the benefits of leasing versus buying. we've run the numbers We've gone through the post, like've we've looked it And a lot of people, every time we talk about the fact that you and I lease cars, someone will comment that we're idiots. I get it. It's like it's not the greatest financial decision in the world But I think there is a huge benefit of leasing a car today than they're way more than there was in the past So I got a new I got my new tellerride and it's funny. you got a Rang Rover or land or R. I never know the difference. range What's the difference between a range roover and a land roover different cars And I drive like a Kia, telli ride or whatever and someone's, Hey, I had a few people say, Hey, looks a R roover I told you it's kind of I'm a homeess man's Range roo All right But the biggestenefit're leasing today is all the new features you get in these cars I feel like the features are multiplying in terms of the cameras and the safety and the alerts and the sensors and these self driving capabilities Driving a new car is just way safer for you It's also making it like impossible to fix. Oh yeah dad My dad got a fender bender and it's six thousand dollars. Oh yeah, that's what happen me before because all the sensors was twelve thousand dollars for a bumper car insurance, I guess that makes sense why it's going high. You go on the highway and it's not like Tesla self driving, but it's like adaptive crewise where it keeps you in the lane and it steers for you. and it slows down on the car in front of you it slows down and it speeds up if it speeds up. I just think that the amount of features that happen in two to three years is kind of insane these days. The technology is getting so much better in cars That's how I justify my terrible financial decision at least It's not a terrible financial decision. How about what about this It's fun to get into a car with three years It really, honestly, for a week, my kids were talking about the new car smell is so good. My kids were just going and sitting in the car in the garage sometimes because they like the smell so much And what's the last time you had Dominoos Pizza Last night, my son gets it every Monday night. It's his favorite pizza in the world. We have Domino's right. It's the closest pizza by our house Every Monday from him I will now get it it's the in the summer I'll get a text. Hey, when are you come home from work? can you gole downmos on the way home It's forite pizza but we had birthday party for him and his sister and all their friends come over. What kind of pizza we get? Dominoes Turns out that George is alone on this one because pizza slice keeps shrinking. The journal had a post showing that Mexican is going up a little bit This is the market share of like these these restaurants Pizza crashing. If you look at Domino stock, it looks horrible. stock that I owned in the past looks horrendous. I think the CFO just resign or I cant remember what' happening, Really bad Chicken Chicken is going up to the right. onene from ten point five percent. in twenty nineteen up to thirteen and a half percent. the chart is a little bit of a truncated chart crime. This is like a misdemeanor chart crime because it' It's a very small axis nine point five to fourteen percent, But you're right. That's right change Um We had, I had a party for Robin's fortieth birthday Nve had a party in my old house We had a bunch of friends over. It was very nice At the end of the night, Robin and I had been drrinking And I said, you don't get dominoes a while It was terrible Really And I hate to I really hate to be like the food snob guy becausecause I grew eating dominant and I thought I liked it or maybebe maybe it was just it was too late and we got like because one of the reasonons them stock so well for so many years is because they improve their quality It was It was ninety four percent draw on. But one of the reasons that pizza is losing share is just because There are so many better options out there today. People got more pizza in the past because there wasn't there wasn't good options for eating And pizza was the one that had delivery. Now you can deliver doorash and can get other stuff. So that's why that's happening is a door dash phen Um, All right, go ahead. U, Okay, so there's the Tony Soprano idea that remember when is the lowest form of conversation We've done this before and we make fun of Chris because he's the biggest remember guy. Yeah, but I reject his premise Tony Soprano was one of the least happy people alive He had to go to therapist because he was so unhapp There are I think there are times when remember when is the but There are certain people who do it way too much course, right One of the people we work with is one of I think there are times when it is useful. So this past weekend, my parents have a cabin in the middle of the woods on a river. It's like there's no cell service, there's no TV's, there's no technology. there's no internet. There's nothing. It's like in the back woods. Middle of the our two track road on the river And you go there and you play yard games And you do a campfire and you go kayaking on the river. And so I went there with a bunch of my brother's friends kind of like everyone wants to keep get together, rememember my brother And all we did all weekend was drink beer, go kayaking, do camp Fire, play yard games Bocy ball, you know, u that kind of stuff and tell stories about my brother And I had the best remember one day of my life. It was so fun telling story, but that's the kind of stuff'll remember when it is good for you. Huge remember one guy. I love it It was like it was actually like very cathartic for me and good to have it and like got it out of the system. and like all we did is tell stories all weekend And it was so much fun. I' laughed all that That's what life's all about. rememembering the good times, right U recommendation I want to talk about why rewatchables. is For me, unequivocably the best podcast of all time So they're going through Hell mononth, which is nineties nostalgia. So what is from hell? Why am I talking about this? Because it's my podcast Um, The Tenant from Hell Pacific Heights The roommate from hell single white female The nanny from hell U Whatll is that Oh the hand head that rocks the cradle steepad from hell to domestic disturbance All right, so Bill Simmons on the reewatchableles goes to all these movies. I watched all of them And I watched domestic disturbance, which had I did see when that came out That was with Vince Vaugh and Trealta T in the movie terrible mov. So I watch the movie, rewatch it So bad. So bad And then I listened to the podcast and it was amazing I, obviously it's an aentally badvie or they did because it was you know, it was horrendous. But Those guys got credit. It's a very good podcast. It gives me ideas of movies to reatch as well, that I would have never thought to rewatch So I don't know that I saw I know I've seen parts of single white female because I do remember It was probably on TBS and TT all the time seeing Bridget Foera and Jennifer Jason Lee with the same haircut Pacific Heights, I never saw that one Matthew O'deeen and u Melanie Griffith Isn it a Michael Keat movie as well? Michael Keaten, of course, when am I saying Yeah So should I watch them? I think I've never seen. Y Yes. Yeah, it was good Really enjoyable. terrible movies for the most part, but Great podcasting. All right, a couple of a couple of I don't know, last month, the other month I forgot to mention that I watched What I thought was a very good dock , ever see the Dark Wizard U next The Dark Wizard is about likeike one of the pioneers of roock wall climbing. what's the thing where Oh free soloing likeike just without a rope. and then he got into hang gliding or like where you just you put like the bat wings on. and spoiler, he didn't make it but it was it was very good Okay. Those guys are nuts Absolutely not Do you watch Do you watch hot D As of the drag Oh yeah, here's the thing. I was going to talk about this. so My wife's like, do you want tona watch she's like, she watches all the TiTok videos to know what's going on. and like, this person is this and She like, do you want to watch the review of last season? like the recap And why it was like ten minutes long And then twenty minutes into the first epode, I'm like, wait, who's that person? Wait, are they good or bad? Is that? But that's why I love Game of Pilones because I can turn my brain off and just be entertained. And I don't have to be one of those nerds that knows like, oh, this is the house of Barathheon. this is that like I don't care about any of that stuff. I just like being entertained It we' constantly confused. Because I watched the recap. first episode was fantastic. So it was the second But I saw the recap too And I was like, wait, that happened. I don't like remember any of this. No. And even thirty minutes through episode one, I have no idea what's happening. honestly. I couldn't tell y which mean, sometimes, but like which kid belongs to which mom Bah blah,ah blah, blah, I love can't tell you anything. I no ide what's happening but it's So my son has been really big into alien movies. I think it was because of Project Hill Mary. So he's dad, giveive me more alien moies. We watch a bunch ofien movies and finally me, I let him watch the alien movie, alien Okay, Sorny weaver And so he watched that and absolutely loved it. And he goes, arere there more? And when, you know, he watches it at Amazon it shows the rest of them. He's, how many these are there? So I pulled it up on chatT. we got an in order And so we watched alien, aliens, alien three, alien resurrection Prometheus, Covenant and Romulus. We watched them all. I looked at like didn't I never thought of like, where do these movies rank Where when do they happen? Right? I never thought I knew Prometheus was the prequel. That's about all I knew And he loved every single one of these movies, but it's kind of funny because as they got Further along you got, the technology got better, right? Because the first one was in nineteen seventy nine The technology gets better and better and better and the action sequences get better. But none of them come close to touching the first movie That is close. No,iens is Aliens is the best. Alien No, Aly In, the James Cabnan movie is by far S second one Yes. You think the second one is the best. No, the first one is by far the best And Alien was acceptable. Alien was great This this is Alien was more of a suspense th aliens, it was a better action movie. Yes. they were very different movies. Youre right. Alien was like a slow burnnt. I think none of them even like the fact that they didn't have the technology back then. made it so you had, but you would never make the movie alien today because it's comparred to the original. And Ridy Scott did the second. Now Ridley Scott did the first one Okay I forgot that there was seven of these movies. Yeah, my son ate them all up ' this iss my favorite movie franchise of all time. Did you know that I think you've mentioned that before. So yeah, we watched them all and But wait, hold on. I'm surprised because the second one is quite scary. When Newt's parents are like stuck in the wall and they're like white as a ghost. He wasn't scared So my son has the same thing as me. He does not get scared by these movies. They don't scare him at all. He finds them entertaining Like it doesn't impact him at all to see all the stuff U He also watched the two Alien versus Predator movies which are complete garbage. AVP two is the worst movie. the So I love the first one when they're going down the car but the second the second one is AVP was a requium yeah, it just worst movie about that. I watched that with Robin back in the day, like two thousand six We're at in my bedroom. And I'm watching it on bootleg and she's like, What in the hell is this garbage? Terrible momie. I got one more The bear on FX is like the hangover. I don't know why I'm so watching it It's on season five now Sometimes you have lightning in a bottle and you cannot recreate it like The hangover two and a hangover three. It was the same characters And they tried to recreate the magic and it just it never happened. And you almost wish they didn't make them Bear season one and two is like one of my favorite two television seasons all time In season three, four and five. just got progressively worse with he obviously ran out of ideas and did its complete money grab And the shows almost unwatchable now. Why am I watching it Some cause fallacy. I don't I have I have one thing before we go So Ben and I well actually you don't work from him. I work from home And I still it still feels weird that I work from home I mean, I'm in the city once a week I go to Belmore here and there, but I really Primarily, I'm in my house And it still is very bizarre. It's not new, but it still feels new and it still feels like I'm like cheating or something. feels like it's wed because you feel like youre on an island sometimes It's bizarre. It's a bizarre thing. and Um, Obviously like I feel blessed out of my mind that I'm able to do this. right I not everybody' so lucky a lot of people have to go to the office and they have jobs where they can't work from them. So U That's just a about throw clearing I feel extremely lucky to this But it is it does do something weird to For me for like the father's son or kid relationship So Kopebe went to sleepway camp U on Saturday And the night before and like I was just like, all, Yeah,ll see in seven weeks And he loves Camplin, like whatever.'s all it's all great stuff But I feel like My sort of like whatever about it or just like just in general, being with him all the time Our parents came home I guess my dad didn't come home because my parents were divorced, but for non broken households back in the day, when your parents came home Like work was done, right? Like they left work and they came home And they gave their kids all the attention I feel like I am giving my kids like, I don't know eight percent of my attention because I'm with them literally all day every day. Now that like, you know, they don't 're not homeschooled., but I'm just I'm around all of the time And it's like a trade offff. Like so I'm not suggesting that like it's better When our parents went to work and came home and were with the kids. R because then they missed a lot. They missed like sports and whatever, they just weren't able to be around. But it is like it is doing some stuff that I don't love. And I do feel like I'm sort of not present taking it for granted, because I'm with them all the time It's a completely different. it changes a relationship in a lot of ways. I totally agree. My dad never once brought work home with him, but parents didn't spend as much time with their kids back then. No parents did It was just kind of known Like, you weren't spend as much time with your parents. You were kind of on your own Yeah, it it's just, it's weird L I feel like disconnected, but even th I'm with him all time I don't know, it's just it's interest Gladly I got that off of your ch Just what I've thinking about. I see you're say The way that we parent our kids Totally different from way our parents parented us But their parents did it different to them too. so it changes. Yeah. I'm not saying like it's all bad or it's all good. It's just, you know, it's different All right, u Whatever Whatever. as Bed likes to say Adible Spirits at the Compound News U ope everybody is enjoying their summer before doing know what I'm trying to do I'm trying remindself getting back to Kobbe that he'll be home in forty seven days We have a reprieve. I love him. He's having a great time. It's all good, but someone goes so fast I'm trying to enjoy every day. You're gonna be saying, can youve it'sall already B? I know. I will not apologize for being it, Can you believe it's that time ye? Happy fourth of July everyone. Hell, yeah. Great holiday might it's