Successful market timing requires not just identifying a thesis correctly but also timing the market to realize that thesis; entering too early can result in significant losses if the market does not move as predicted. The skill of waiting for the market to confirm your thesis before acting is crucial, as markets can be violent against those who act prematurely. Timing it better means waiting for the market to also realize what you're saying is true, rather than fighting the market directly.
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REUU RABBLE - Graham Stephan Roasting, Joseph Carlson $DUOL, Jeremy Lefebvre's TRASH PERFOMRMANCEAñadido:
has been telling me that the the herpes is probably going to go away after just like a few uh anal retention shots and then possibly >> Dude, you know we're live right now, right?
>> You said we're waiting for Fabia.
>> No, no, I clicked live.
>> Just kidding. Everybody Mary stock market. Oh man.
It's the real rabble. Give me money.
How you been, Cole?
>> Well, it's been a whole like two weeks since when was last was Was it two weeks ago? I want to say it was Mother's Day.
>> Yeah, a couple weeks.
A lot of things have transpired though.
You know, it's been a busy >> ask for the link even though it's like five texts above. I'm going to let him know I sent it to him on Discord. Tell him that >> we're about to have Fabio join.
Uh Cole sent it in the Discord. So in this video, we have to talk about Graham Stefen. We have to talk about Joseph Carlson. We have to talk about Jeremy Lefave. And of course, we have to talk about the stock market, which is why Fabio is going to join us as well.
>> Boy, boy. Yeah, I don't think Jay Nogi is gonna gonna make it unfortunately.
Well, you you asked him like two days ago and he he hasn't still hasn't responded yet.
>> Well, he he sent me a Facebook message.
I think he has like an appointment or something. I guess he doesn't want to talk to you. I guess he doesn't like you anymore.
>> We can still He can still text you. Why would he Why would he text you separately from me? He only uses Facebook Messenger.
>> He doesn't like you. That's why.
>> [ __ ] >> You're ugly.
Yeah. So, what topic are we starting on, gentlemen? Are we making fun of people or are we talking about the stock market first? What's going to hook in the viewers first?
>> I had some I had some racism on to start with.
>> Go ahead.
>> So, these two [ __ ] you know, don't this is not about that woke DEI [ __ ] That's not real. Okay. Uh, this I love this very I love the CNN panel shape we have by the way. Um, no this is about actual racism.
>> I should just like here though.
>> Fabio Fabio Strongman and Jay Nogi all live on the East Coast. So >> they always like, "Hey guys, we're going live at 11."
>> And for them it's 11, but for me it's 10. So I was like three minutes late because I was thinking it was 11. Um, so now all Strongman has to do is say, "Hey, we're going live at at 300 PM Green Witch Meime." And we would all understand that, but instead he uses his East Coast time zone.
Uh, I hope you understand that number one, Washington DC is on the East Coast, and that's the capital of America.
And number two, New York City, which is where the stunk market is, is also on the East Coast. So, I think it's implied that if I say 11 o'clock, it's obviously going to be 11 Eastern. Okay. This isn't like England. We don't have like that time zone is.
>> Do you know where Omaha, Nebraska is?
>> I know where Nebraska is.
>> All right. Well, all right. Point proven. All right. So, first topic, it sounded like I know Graham Stefen came up. I I'm not familiar with the uh apparently him and Jack have been cucking each other or something. know what's going on there.
>> Yeah. Okay. So, riddle me this. If you were 51 and you had an attractive wife, would you move or have a six-foot tall handsome guy living in the house with you?
>> That's actually what's happening. I was making a joke about cucking each other.
That's what's happening.
>> I I there I don't know if Jack still lives with Graham.
>> Mhm. But there was a time I'm pretty sure where Jack was living with Graham.
So if somebody like, you know, I'm 5'10, whatever. If a if a guy that was 67 and a supermodel was in my house and I had a hot young wife, like I would feel I feel a little threatened there. And I wouldn't be surprised if there was something going on.
And isn't Jack related to Graham through through like his wife or something though? I thought I saw a comment that said that >> that's that's probably somebody just making something up.
>> It could be. It could possible. It's possible.
>> Let us know is Jack Graham's wife's brother. Now, that doesn't disprove anything.
>> True.
>> This is just this is just a suspicion you have, right? just >> I I mean like I I I've dated enough and I've I'm old enough to know that if you have a guy that's way hotter than you and he's in your house, >> he's probably porking your wife.
>> What? That is true. By the way, everybody needs Bobby.
>> I mean, like it's just it's just a it's just true, you know? I mean on the stream.
>> He's making fun of you because you're at an angle.
>> At an angle. What?
I was I was saying until when you guys called me out. Just like I was slowly moving that.
>> What if we said nothing the whole time?
You just >> Yeah.
>> Cole, I thought you'd been doing YouTube for a long time and then you you just weren't even centered. Like imagine you went on CNN and you were doing that where like half your face was cut off.
>> Happen on CNN. Just like >> why why is it so thin, dude? Three little Oh, I'm sorry. I'll make it wider. I'm sorry. Is that better? Oh, no.
>> I gota adjust the lighting. No, no, because I was messing with the lighting because I saw it was like getting too white.
>> Too white.
>> I got this.
>> Depending on the shirt I'm wearing, it [ __ ] with it.
>> But does everybody like this better? The lo donate $5 if you like this better.
Donate $10 if you want us to go back to the other thing.
or or more if you feel like it. I mean, look look, I'm trying to get to $800 this month in ad revenue and I'm like I'm pretty close. So, I I need at least a couple $50 super chats.
>> What Let's set an exact goal. How far away are you?
>> Uh I don't want to say the exact number. I don't want to limit the super chats.
>> I do.
>> Let's just say it's a couple couple hundred bucks.
>> All right.
>> How's the ad revenue lately?
It's pretty garbage to be honest. Uh most of the money comes from memberships and super chats. Like I I'll do a video and it'll get like $4.
Even with a couple even if it gets a couple thousand views, it's maybe 10 bucks. Like it's it's literally nothing.
>> That sounds normal to me for that view count.
>> It it's it's a little lower than what I remember.
>> I got you. I know you've already It's >> not lower than what I remember. Let me tell you.
>> I guess I have to calculate by the time because let me see. My last live. Yeah, my last live I made 18.
>> Oh, did you get any super chats?
>> No, no super chats. I hardly get super chats cuz I'm too I'm too generous. I answer all the questions.
>> Yeah, you Oh, bro. You You're leaving out monetization there, buddy.
>> No, I know.
>> You're leaving out Oh, boy.
>> I should do the thing. You do the the Oh, you got to be a uh the member for the questions.
>> Yeah. I mean, people will pay it. Five bucks. That's nothing.
>> Well, Chris aka daughtergo said Jack Selby met Graham Stefen by cold emailing him as a dedicated fan in 2020 offering to work for him for free.
What a loser.
H So maybe maybe Graham >> Cole, would you work Cole? Would you work to for me for free?
Not for not for free minimum wage.
>> I would work for me Kevin for $100,000 depending on what it entails.
>> I mean, he no [ __ ] gave me a job offer.
I still I regret not taking that job to this day.
>> You probably should have taken it.
>> My ass. Could you imagine working for that psycho?
God, >> it probably that is why I'm like, "Oh, it probably be like a nice gig, but he would probably like have you working like 24/7." Like literally like you're not allowed to ever leave the job and he's like, "You got to pick me up from the bar every night and stuff at 2."
>> Oh, yeah. He would definitely take over your personal life. Like he'd be calling you all day, every day on the weekends.
Hey, I need this. And he constantly changes his mind. He's bouncing from one griff to the next. It would be a chaotic life. I mean, it's it's a job for a young dude like that little >> Mormon boy or whatever he has working for him. That's the kind of guy that would be better working for me, Kevin.
And the dude's making bank, too. They're paying He's paying him pretty good.
>> I was going to say from a financial standpoint, I mean, I think for Jack and for that other boy you mentioned, I think it was probably better than the alternative, right?
>> I mean, they >> What's What's the alternative? Being a guy [ __ ] No, no.
I'm saying >> I'm saying if I think now I I I don't know their situation, but um I presume Jack is wealthy now, especially for his age, right? He's >> Yeah. I mean, he probably makes good money. I mean, obviously like offering to work for free could work out, but I I think as a general advice, >> it's a gamble.
>> It's It is a gamble because there could be people that take advantage of you.
the average unless you're unless you're working for a big influencer like Graham Stefen. Like if you're if you're just looking for a job or skills, >> I would not recommend that you just say, "Oh, I'll work for free."
>> You know, there's only a very specific circumstances where that could actually be an intelligent move.
>> Yeah. I Cole would work for free for Kelly OG.
>> He knows he knows that would pay off.
>> Yeah. Cole, is your channel still monetized?
>> No, they said uh they said uh I was I was still getting like it's not a lot, but like once a month I was getting like $10 even without uploading, but like um if you fall below the monetization criteria, they take it away after like six. So after like six months um I didn't have so many watch hours. Um so they took it away. Um so I have to re resubmit. So >> well, it happens. So, I lost my monetization on the uh dating channel because I posted an AI short.
>> So, I I get to reapply in July and get my $10 a month whenever I get reaccepted.
>> So, tell us about Graham Stefen. I see you've been making a lot of videos on him lately. It says turbo manlet 52 energy proof he's dumb. What is what has Graham been up to?
>> Uh he he just did an interview with uh he did a couple interviews. He did one with like Chris Camilillo who I I I just heard about him. He's on Dumb Money apparently, >> but apparently he's big in the finance space. And then uh he did another interview with the money guys, those financial adviserss.
>> I know them.
>> And it it was just incredible some of the stuff that Graham said he was doing.
Like he doesn't even have retirement accounts.
like a a finance guru who's in the top tax bracket, you know, who purportedly knows what he's doing, doesn't even have retirement accounts. Like that's very odd, you know.
>> I don't actually know how that works with uh because he's self-employed, right? I know there's like a a set by, but I don't actually know how that really works.
>> You can start your own 40 You can start your own 401k.
>> Yeah. I mean, you have access to the same stuff >> that a normal person does. And even better, I mean, like a lot of people don't even have a 401k. So, but if you're self-employed, yeah, you can start a 401k. You can match yourself and you can actually contribute a [ __ ] ton of money. I think it's up to like $70,000 because you have the employee, which is limited to like 23 or 24, but then the employer can also put money in the 401k. And if you're the employer, you can put money in there. You can do a Roth. I mean, you can do all the same stuff. You can start your own HSA. You can do it all. It's the same thing. So, it was just shocking to me that he he had that scenario. And then, you know, of course, Jack was just saying stupid [ __ ] about, >> I don't know, selling calls on Blumin Energy or something. There was just a lot of content in the material. So, I just felt like dumping on Grant a little bit. And of course, you know, I have to call him a turbo manlet every time because it's funny. Well, I hear I hear >> Fabio likes his >> I hear Jack dumps on Graham after banging his wife then on Graham.
>> But for for the um you you have it's up to a point right on on the contributions of the 401k because you can't let's say you're you have a business and you're not paying yourself that high of a salary for now. You can't just like max contribute, right? both you and then the business side to reduce your income to like nothing.
>> Well, if you have an escorp, you uh you like because you're paying yourself payroll.
>> Yeah.
>> So, yeah, you're you're limited based on that.
>> But there's other options like you could do a SE IRA. Like it really depends on your your situation.
>> But I mean it if you're a profitable business, you can afford to pay yourself a small wage. you're probably going to be paying yourself 25 to 50,000 anyway or more.
You could easily max out the the 401k at least from the employee contributions, but it's just like you should be doing it. I mean, even if you're not putting in that much, it's just shocking that you're this super wealthy person making a [ __ ] ton of money and you're not even using tax advantage accounts.
>> What about through a partnership?
>> So, I know an escort, but a partnership.
Can you do one?
>> Well, I don't know. Yeah, you're self-employed.
>> He He does. He does for us.
>> Okay.
>> I mean, there's options we could talk about if you want to do it, but because like are you doing anything? Are you doing the IRA or >> IRA? That's one.
>> Yeah.
>> No, there there's other options for you.
>> Yeah, because I think eventually setting it up through the fund as well is important because like, you know, I don't know, just having it established already. So down the line if we ever have an employee, they have that option as well because it's nice through one of the services we use uh cuz I've been you can put your IRA in and I think they do 401ks as well. You can put it into the fund which is nice because you can do things uh that way that you can't normally do in a normal IRA. Um but um yeah. Yeah, because most of my for the foreseeable future, most of my uh income is going to be carry instead of salary, at least for the foreseeable future. And I'll just be living off investment income.
>> All right. Nobody nobody clipped this and send that to Elizabeth Warren. Okay.
>> Yeah.
>> Oh, man. Yeah. And I mean there there's other like you because you have other stuff that's connected to it like other partnerships.
There's lots of options you have basically.
>> Yeah, we can do a consultation. I'll bill you 500 an hour. We can sit down and talk for a couple hours.
>> Make a thousand an hour. Why not?
>> Yeah. Oh, yeah.
>> Do metric hours.
>> Metric hours. Yeah. hours.
>> All right. At least as far as I guess we could if we had any pre-planned topics, I guess we could throw them all out and then decide on who we want to start with or the comments can say. I um I was a brief topic, but I want everybody's freaking out about uh the indexes adding like SpaceX and some of the other large IPOs too early and stuff. Something I wanted to talk about. I don't know about you want to talk about Iran and stuff.
>> No, Iran's like uh wrapped up but uh we can we can brush on it but no I like the topic you brought up. We can get into Ron we can get into the mark because last time last two times we've kind of given different perspectives on the market and I think uh now we're you know it's fun to look back and see what happened. But let's talk about the SpaceX thing. I think that's freaking everyone out. I see that all the time.
I've been I'm in a massive panic. I I heard that money is going to come out of the other big tech stocks and it's going to cause the whole market to collapse.
>> Am I quiet?
>> I'm I'm really nervous about that.
>> I I think you're quieter than us. I don't know for sure.
>> Yeah, it's cuz this thing is supposed to be really good at, >> you know, focusing on Yeah, exactly.
Okay. So, sometimes if I put it over here, I get a lot quieter, >> but I have to put it like sometimes up to my >> Yeah.
>> my mouth and I muted the whole time.
>> Yeah. Are there other things you try to like get close to your mouth like that?
>> Uh food.
>> Yeah.
>> Yeah. Yeah. Food. Sorry. Yeah. Food.
>> Yeah. Food. Yeah. All funny original jokes. Um >> but no, the SpaceX IPO is pretty cool. I I was I mean I was look I looked through the financials and I was surprised to see how profitable Starlink is.
>> Like I I think that's actually Elon's best business and his coolest business by far is Starlink.
>> So you're at least getting a fantastic business with that. I mean the rockets I don't know how much growth is going to be there. And then uh there's what's the other component? He's I think he's like saying that at some point they're going to get into AI or applications >> owns XAI now I believe.
>> Yeah. Yeah. He's basically saying that's going to be the he was saying that's like his biggest market in the long run is the the AI portion of the business.
>> Yeah.
>> I don't know how true that is.
they'll definitely have the capacity to invest a lot in in AI infra um because you know now that they're in the public markets accessing capital they're going to have a lot more options a lot more liquid options like that's one of the main reasons to go public um you no one no one deals with the regulatory headache for no reason it's it's access to capital and and I think SpaceX and you know when you look at and you break down the businesses the reason for their lack of hype hyper profitability uh well hyper profitability not relative to their size just like in more generally um is some of these businesses like XAI uh but yeah you notice Starlink is is very profitable business the the rocket business there there's a moat around that uh because you know before pre um pre-paceex there was this um uh lack of diversification from the space industry on where we sourced rockets. And now there's more, right? Because there were doomers back in the day. There were doomers. I recall, you know, like, oh, this is, you know, if we if we mess with Russia, they make all our rockets. And then it's like, oh, the US won't have rockets. And it's like, that's a silly comment. Um, I always try to tell people it's like whatever dumerism, the problem with doomers is that they lack imagination and they they they they fail to understand that in the human population, they're extremely autistic people. in a good way. Extremely autistic people that if you give them problems, they somehow solve it. You are a normal person, so you cannot conceive of the solution to the problem. But uh there's millions of them out there. And >> I mean, most of human history is just people adapting. Like people think it's some it's the end of the world. Oh, we're all going to starve to death because population's growing too fast.
>> And they found ways to enhance food production. Like there's always going to be a something that's going to be solved by some smart person somewhere.
>> I I the numbers aren't going to be exact, but I I think I I heard something like if our farming techniques were still what they were in like the 40s and 50s u to sustain the current uh food yield we have globally like 90% of all land would have to be like farming. And of course it's not. So apparently now I'll fact check that. I think that was from uh let me find the name of the book. But y'all can continue talking live.
>> The rational optimist I think is what it was called.
>> Yeah.
>> Yeah.
>> Sounds like a mouthistic idea.
>> I mean that that's why it's good to be bullish on the stock market in the long run because like there's always some fear. Oh, population's going to collapse or this is going to happen or that's going to happen.
>> The ozone, you know, I remember >> you see over and over again people solve problems.
>> That's just how it works.
>> Yeah. Growing up, I remember like, oh, the hole in the ozone layer and and it was, as far as I seen, real genuine issue, and then but then we fixed it.
>> Yep. Yep. There there's And there's always people trying to chase uh the next, you know, doomer narrative.
There's this guy who he's not blowing up, but he comes across people's feeds sometimes and they'll share it more to make fun of him. But um it's a guy who's been shorting the market since like 2022 and he's saying, "Oh, we're the most overvalued we'd ever been.
>> I watch everything, buddy."
>> It's not the guy's like through he he has a yolo trade like 600,000 now. It's valued at 400,000 >> or his whole portfolio is valued at 400,000 and >> um or something along those lines. But point is it's he's he's betting a lot of money against the market saying overvalued. Then I find out, oh, but he shorted in like 2022.
>> He didn't short in like 2026. He shorted in 2022.
>> Oh, brutal.
>> Probably he's he's early, but he's not wrong.
>> He's See, and the other problem with that is like there's there's a there's the inherent fallacy of like if I say every day, the market will crash.
Eventually, I'll be right. But when you're trying to actually like let's say you're managing other people's capital, you will destroy them.
>> Mhm.
>> Because most of the time like Michael Bur and and what he's famous for um that was a very rare specific scenario. And it is plausible that some of those individuals who were involved there um had the trait of their lives and they peaked right there. Some of them didn't, but some of them did. Um, and I think Michael Bur, who is more famous, I think, from that versus some of the other folks that became famous for other things post 2008.
>> Yeah.
>> Um, >> I think what's interesting is that, um, we can talk about G. I think what's interesting is >> Yeah. at least my from my reading of the big short book which obviously paints very in a a good light but uh it does sound like he was like a a genius to actually spot it. So it is it is strange to me that he seemed to have like seems like almost like he got lucky but because he just he keeps calling crashes but it seems like he he he was not just lucky in 2008. It seems like he really did the work and like uncovered like oh [ __ ] you know? So the uncovering part is yes it is interesting but it's not unique. There were others that did it who you should respect more were the ones who even got the timing right.
>> Now that is this is the real skill because um you know Andrew can can talk touch on this a lot better than I can cuz he handles our short book. But it's like when he's looking at shorts, um, he could identify that something is a short, but he's not going to be [ __ ] and get in front of the freight train.
And it's like, okay, as as an example, uh, let's say you identify um, you know, quantum qu these quantum companies, okay, they're they're full of [ __ ] right? But yeah, >> is there is there some setting with your mic? It's the moment you turn like even five degrees away from the mic, you get like half as quiet. I don't.
>> All right. If I if I keep myself like this like turn the crazy like >> I mean we can we can hear you. I don't I don't think it's that bad. But >> I think it's that bad.
>> Turn your Is your volume up?
>> What's the problem? You're louder. So I don't want to turn but I I'll turn the volume up more.
>> Deal with it.
>> I want to talk extra loud now.
>> Talk talk quantum.
>> Yeah. So no, no, it's just the point is like when when you get into for example the US government is actually investing in quantum research which makes total sense because it is a technology all all the people who are familiar with it say it's a technology that will eventually happen. So we do investments into things that don't take they don't bear fruit next year. If you're thinking longer term you're you sometimes you spend money on R&D that leads to nothing.
That's the whole point. You're you're trying to discover things. So it makes it's totally fine that the US government is doing that. There's no issue with that. But in the meantime, what that causes is a euphoria and a frenzy in quantum computing stocks. Some of them are legitimate. Some of them are illegitimate. Some of the legitimate ones had had terrible financials. And so some shorts out there argued they're shorts because they have terrible financials, they're bleeding, blah blah blah blah. Um but they're more legitimate in terms of their research.
uh the one that of the most popular retail ones like for example one that comes to mind is Regetti. um they are more in the legitimate camp and then you have others that are much less legitimate and still are getting they're they're very popular but if you're you know a Michael Buresque figure and you're trying to get in front of that you could destroy lots of both opportunity cost for your investors and also you could have permanent loss of capital depending on the sizing and the violent of the move. So the more the more talented short seller is one who is right on the thesis and correct on the timing and doesn't let their ego get ahead of making the right decisions i.e. timing it better. Uh because timing it better is like when you you can wait for the market to also realize what you're saying is true. You don't have to fight the market. the market can be very violent against you in a short period of time.
>> And >> yeah, >> tell me if you think this sounds right with with Bur. The reason Bur was so early in '08 is I think his thinking was like, oh, this is so obviously going to be uncovered quickly that I need to hurry up and get my position in before people start pricing it correctly. So, I think he kind of now I think he was seemed like he he could have waited.
Does that sound right at all to you or no?
>> Could have waited years. Yeah.
>> Yeah. But do you do you think in his head he was like, "Oh, somebody else is going to figure this out. I need to hurry up and get my position locked in."
>> Cuz he he made good returns on it.
>> He made He made good returns. Yes. In the end, because the because the move was very violent, but he could have made better returns, >> way better returns as some of the others did.
Well, the problem with Bur now is I think because he had that one massive win, I think people almost expect him to do it again and I feel like he feels that pressure. So, he's constantly out there trying to identify the the next bubble that he's going to call so he can live up to his reputation. I mean, it's like a guy that calls a stock that 100x's.
>> There's going to be pressure to find another stock just like that to keep his reputation going. So, I think that's part of the reason why he's always out there like, "Oh, I'm shorting this and I'm doing that. I'm going to find the next big short because it's it's the the pressure of the fame weighing on him."
>> Yeah. It's noise. And there it also births a lot of people who try to ride the coattails and they try to >> try to find the next one as well. They they look at what happened and they say they see the fame there. And so you see a few of the more clownish types um talk about other bubbles that are that are brewing and they're calling doom and gloom and they call doom and gloom every single year. So yeah, it's um it's it's interesting to to observe and and a lot of retail investors still give Bur a lot of like attention when he's not really it I when he had a fund it was interesting because he was much more held accountable to his trades.
Now he's moved in the direction where he can say a lot of things and he's not going to be held as accountable and he's monetizing that fame he has which is really >> super intelligent from a personal view like he's going to do really well >> uh cuz a lot of people out there are willing to listen to him and pay him money >> and he can kind of just dick around with like whatever amount of money and you know he gets collects his nice very nice subscription fees. So he he did the smart thing for himself in all honesty for his mental health probably long term.
>> But um yeah, that that's the that's the gist. Like when when he came out with this thesis against hyperscalers, it didn't make much sense on the face. And I think he's sort of backtracked from that a little bit. A little bit. Not fully.
>> Has he?
>> Yeah. Yeah, cuz he he invested, for example, I believe he he he made a case for uh I think it's Microsoft, which if a lot of what he says is true, Microsoft is um it's going to be in trouble.
But uh >> he made a case to short it.
>> No, no, I think he went long, Microsoft.
>> Okay. What did you say about he made a case? Oh, you're saying previously he made a case that they were in trouble, but now he's long.
>> He made a case that all hyperscalers are are essentially fabricating the useful life, which is not true. M >> yeah, >> I do recall that part. Um >> it's it's not true. You would see it in other parts. That was what was surprising to me because you would think, you know, he he understands a little bit more about accounting >> than he otherwise would have because in order for him to be right, you have to like get even more conspiratorial. you have to like start wrapping tin foil around your hat a little bit more and a little bit more and a little bit more because again you would see what his claims show up in other parts of the financial statements. Um because they'd be disposing of assets at at losses.
They'd be you know recording it as a as it has any value and then disposing it at a loss completely. And you would or or you know you have to start thinking like oh they're stashing it in a mountain somewhere and they're saying they're still using it but they're not using it. You see like how conspiratorial it starts to get because oh they're not they're not disposing those assets because they they're saying they're using it but they're not using it. They're they're they're burying them.
>> Michael saying they're using them.
>> I we kind of got away from the uh starting point where I said about the index funds adding SpaceX sooner than they normally would for most stocks. Um which I mean simplest explanation is it's IPO and get over a trillion dollars. because I mean typically companies don't IPO at that valuation so it's going to be a huge part of the market but but my main thing look and this has nothing to do with SpaceX could be worth zero for all I care but I see people on Twitter um some I spend more time on X than Reddit nowadays much better but I do occasionally I see some morons on X and u and on Reddit as well and on on YouTube where they say like this is the end of index funds you know like Jack Vogle you see spinning in his grave right now. And I'm like, and what's what's the issue here? That they're like, well, the issue is the index is going to hold an overvalued stock that I don't want to own. I was like, that is the point of the index fund is you buy everything. Of course, some things are overvalued in it. That's the if if you're so confident that SpaceX is overvalued, then just buy individual stocks. If you don't want it, that that's you're the one that chose to buy the index fund and now you're freaking out like, well, I don't want to own this one. Oh, and it's not even it's not as if it's like 50% of the market or something.
>> Well, the the industry solved it because now you can do direct indexing. Like if you're so passionate that one stock is overvalued, you can actually like hire a financial advisor. They can direct index. They basically buy all the individual securities and then you can just leave out that one stock that you swear to God is overvalued.
>> Yeah. But it's not surpris I mean like that's just the game with uh money management is of course big money money managers don't want you to index >> because they want you to come to them so they can charge fees. That's how it's always been and how it always will be.
So, there's always going to be a new reason that they're going to come up with to claim that indexing is dead when it's clearly not. And there's clearly an an active market with price discovery because you can look at individual stocks even at the top of the index and you can see how volatile they are and how quickly they react to earnings.
>> I I don't think we're at the level of passive index bubble despite what a lot of people say.
I remember back in 2017 2016 these same arguments were being made but in a different ca a slightly different case the overconentration of the index. These businesses were already too big. How much bigger could they get? Um, and there was also the cuz people may not know this, but the um the the the PE that you see on like an index fund, right? Or an ETF like the S&P 500 uh index, you don't actually have the, you know, weighted average P. I >> I would assume they just add everything up in a a weighted sense. No, it's a harmonic weighted average.
>> I don't know what that is >> exactly. It's super it's super complicated way of just saying >> let's go into the details.
>> So, it's a weighted harmonic average PE.
It's a way to adjust for unprofitable businesses.
>> Ah, okay.
>> Um, so but it's not like a simple weighted average. If it was a simple weighted average, the P is like way way way way higher. Um, and people post the Schiller PE as if the Schiller PE is something that, you know, actually still is applicable because no one applies nuance anymore. Everyone just says like, you know, this thing that was useful at one point in time is then therefore going to be useful forever into the future. Uh, ignoring the changes that have occurred. For one, I think some people are now starting talking about more, but constituency matters a lot. So where you you had a market that had primarily as its largest firms banks, energy companies, mining companies, etc. You implicit you think intuitively like those should have probably as a market lower pees. They do globally. You'll see like mark some markets are dominated by banks which are cyclical businesses. Um, and and perhaps for for an outside investor thinking about them, they they're more like a black box. Like I I don't know. I won't >> or any color of box >> or any color of box or you know >> and the the well energy companies it's a commodity business like what do you want to pay for a commodity business longer term? Do you cuz because when you're expressing a high PE what you're what the market is saying when it expresses IP is confidence in future cash flows.
So you're discounting it less and less because your degree of of uncertainty is going down. Um and so therefore that's expressed in a higher multiple. So, uh, when you're talking about an energy company, there's actually a huge variance in the forward earnings because it depends on a lot of things, um, outside of the company's control because it it sells a commodity. And that when when your constituency drops from lots of energy, lots of financials and it reduces and and is replaced by you know Microsoft um Microsoft, Apple video, whatever. Uh and you look at just even the margin profile um the the products are not commodities.
They're there's actual IP there. there's actual um stickiness to the product that you know through thick and thin customers use it broadly. They have a dominant market position. I it's not like oh uh I'm only going to use Exxon Mobile.
I don't care about anyone else's oil. My car in my car I only use Exxon Mobile oil. There's some people out there like that for sure.
>> There's everywhere.
>> Yeah. And and >> Yeah.
>> Yeah. Very specifically. Yeah. I just want to make sure that my my point came across that it Oh, wow. WOW.
>> Thank you so much, Major General Tao. I think this is the >> This guy is my greatest fan.
>> Is this the math guy?
>> He's a Chinese spy.
>> [ __ ] Maybe he he's my CCP handler.
>> He's your CCP handler.
>> Thank you very much. I I wonder who uh got the lucky memberships.
>> I'll pull you guys.
>> Manual Gus 4, Sam Fia, Swift 2020, Anti-gravity Music 5752, and Quazy 349.
All common viewers that chat a lot. You know, we all >> Dude, I love sometimes I'll get like a gift membership and it'll be per somebody that just popped in one time.
>> Yeah.
>> And they never come back. So, it's like it's just funny to see these random names that just happen to click on the video once.
>> Thank you very much. Appreciate it.
>> Yeah. I so I just wanted to make sure my my specific point about the SpaceX and the index fund thing is that I I guess and I found this happens often is that uh on online discussions people will only people do not use a word to mean what the word actually means. They just use the connotation of it. So the average person an index fund is it's it's safe. It's conservative uh you know it's not it's not like crypto or it's not something crazy. So, in their minds, an index fund can't have some crazy overvalued stock like SpaceX because that's not what an index fund is about.
But I'm like, "No, it's about you own the whole market because you don't know where it's going to go." But in their minds, like, "Oh, well, an index fund is safe, so I can't have something like SpaceX in it." Um, and and I I'm like, I don't know if you fully understand what the reason to own the index fund is.
It's that you have everything. it, you know, actually you bring up a great point because when you're talking uh to people these days, they say like, "Oh, what's a conservative portfolio?" And they say, "Oh, uh 100% VU." And then it's like, "No, in in financial theory, that is an aggressive portfolio. Why is that an aggressive portfolio? Because you are saying I'm going 100% equities."
Uh a conservative portfolio leans higher in towards fixed income. Mhm.
>> So yeah, when when you're when you're expressing your portfolio as 100% S&P 500, you are taking an aggressive stance. That is an aggressive portfolio.
>> I've definitely talked about it before.
I forget if I think I made a specific video on it. Maybe I maybe I've just talked about it in general, but yeah, it blows my mind. And I don't see it as often, but I did during like 2020 to 2022 or so. I I remember seeing it. Um, people would be like, "Hey, you know, I'm 24 years old, fresh out of college, just got my first like real good job.
Uh, my portfolio, it's 100% S&P, like you said." Um, and and everybody everybody would be obviously not smart people, but all the comments would be, "Dude, you're in your 20s. Why why are you 100% index funds? Like, you need to take on some risk so you can get higher gains with your portfolio." And I was like, okay, I remember just five years ago, like just like in 2015, if you had 100% equities, people are like, what are you insane? Like, what do you that's way too risky. But now now 100% equities is considered too conservative if it's in an index one.
>> Exactly. Which is which is insane how warped people have become on that.
>> Yeah.
>> Um Yeah.
>> Hold on a minute. Where are you getting gas for 363? I got my cheeks clapped cuz I I had to drive down to help my sister with something. I paid like 445 for a gallon. I was crying on the way back from that. So I don't where the hell you get 363 a gallon.
>> That's that's my my um my Costco is that it's 360. And I thought I thought I was like >> [ __ ] We Louisiana typically has cheaper gas I guess because we we have like the I don't know if this is the direct reason but we have the either largest or second largest Exxon refinery in the country is right right here in >> Ber that is a reason because transportation costs are cheaper to get you the gas but yeah I think I paid 450 for premium recently somewhere around there >> oh >> no no so I'm trying to think like what what uh >> he's got a nice car >> probably was like yeah I drive I drive a Honda Civic but I put the premium in it you That's okay. That That's not nice, sir.
>> That's not nice. He's implying that I'm not >> No, that the comments are >> he Oh, he meant you. He meant you.
>> He's basically saying I'm not his favorite YouTuber.
>> Why don't I make videos? How can I be his favorite YouTuber?
>> He didn't say my other two favorite YouTuber. He said just my two favorite YouTubers.
>> Very, very cruel. Very cool.
>> Uh, $2 super chat. Allan left because his guilt got to him.
I'm so glad to get rid of that pain in the ass.
>> We don't have to talk about him, but oh my god.
>> I don't know the lore. Who is this guy?
I know. I know.
>> He's just dude, he's just he was he's just this random troll that would every video he'd be there saying, "Oh, you're cooked. It's over. You're failing."
trying to help me apparently. Every comment, every video he'd have at least one comment. It was just like he was a dedicated troll.
>> And I basically got rid of him. I said, "Okay, if you want," because he was paying for the membership. So I said, "If you want to keep commenting, you're going to the troll tier and you have to pay me $30 to keep commenting."
>> Mhm.
>> So that's how I got rid of him. But yeah, that's the lore. Just a pain in the ass.
Oh, damn. I should have a troll. I don't have I don't have any trolls. just the skitsos.
>> Yeah.
>> I mean, I'll deal with trolls, but you better freaking pay me. I'm I'm not going to read your stupid ass comments all day every day if you're not paying me a lot of money.
>> So, let's um well, I guess we can segue a little bit into uh Iran and oil markets.
>> Sure. I mean, that's the logical thing after that. We're talking about high gas prices. Just tell me when my gas is coming down. Okay. I was not happy when I filled up my car.
>> Yeah. Well, that's that's an interesting part, right? It's like uh you know how gamers rave at like prices over $60 on a game.
>> This is this is the same psychology actually is happening with with gas prices. Um because do you recall the last time gas was this expensive?
>> 2020. It was during the pandemic. I remember >> before then. Was it ever this price?
>> One more time.
>> Before then, was it ever this price?
>> Uh I think I don't know if I was even driving back then. Maybe >> higher in 08.
>> You wouldn't have experienced it cuz you were driving now. You were probably driving or started driving in like the close to like the golden age when we had cheap gas cuz we discovered shale.
Actually, I remember when I because I got my light I I was 18 when I started driving because I moved back to America and I couldn't drive overseas and I I think I remember when I first started driving, gas was about $4 a gallon at some point. I remember it was crazy high back then.
>> Yeah.
>> And then Yeah. We had our golden age where gas was cheap as hell up until recently.
>> Yeah.
Echo is feeling left out.
He's not even a He's not even a member of my channel, Echos. Okay, Echo, if you join the membership, I'll think about it. And maybe maybe some uh super chats to juice up my uh juice up my uh >> like magnity or whatever.
>> Echo, I want you to join. You were not you're not one of the original Even I'm not one of the original members of Rat.
>> No, the original member was Jay Doggy.
>> Yeah.
>> Yeah, it was it was just me and him. We had like three viewers.
Which by the way, by the way, it has come to my attention that that someone is spreading misinformation about uh Jay uh to to Jay of what people say about Jay. Dan was the one who told me. Gil, if you're listening, I know what you've been saying.
>> What is Gil going on his live stream and like making [ __ ] up or something?
>> Yeah. Yeah. Gil Gil is going on Jay's live stream and say dance boy dance he's not generous enough to join the membership apparently >> but anyways oh we won't get >> thank you >> the on oil the reason why I was asking that is we we have to look at things also adjusted for inflation right and so the the glass half full glass half empty glass half empty is, oh, oil is higher than it was a few months ago. This make me sad, angry. Video game now costs $70.
But, um, the the way to more properly look at this is like over time, we've had inflation and the price of energy hasn't really done anything. In fact, like depending on look at the time frames like you recall a time in the past when energy was around this price at the pump, but since that same time where you recall that >> Oh, I love being a YouTuber.
Um, shout out to Echoes from Above. Make sure to go subscribe to his channel.
You'll learn all about uh I think uh some some chick that is uh adjacent to I don't I never really understood who the chick was. Uh >> I heard Erica Kirk has a boyfriend now.
>> Yeah.
>> But let's not get sidetracked. We're talking about oil.
>> But go subscribe to that.
>> But you know the price of oil adjusted for inflation has actually still been just trending down. It's been very weak.
This is what it sucks sometimes to be, you know, pure commodities investor.
Like imagine if you bought like if you said, "I'm going to invest in barrels of oil and you bought >> I've never thought that once in my life."
>> Good. You shouldn't. I mean, it's it's meant to be traded, right? If you're if you're not in the operational side where you're trying to hedge your your supply um or you're not trying or you're not a business that's intaking energy and you're also not trying to hedge your intake supply um >> keep talking when I pull up a comment it it's just there for me to address it later but just don't don't let it distract you. Just keep going. And um the you know if you were let's say yeah 20 years ago if you bought barrels of oil you didn't really do well and especially if you account for inflation you did very poorly.
Um so oil is higher than where it was at a price point where it was probably unsustainable.
Um, and what you mean, what I mean by this is like there there's a sweet spot.
If you talk to energy guys, uh, one of the guys I know in IRL, because we're on YouTube, haha. Um, he he worked at at Chevron for many many many years. He's retired and he always explained it that you know energy energy markets they have this uh uh sweet spot where you want to be and and oil executives they understand this where if oil is too low that well yeah that sucks for them in the short term but all that's going to cause is is the weaker players are going to die and then you're going to cause a future supply shock which was the thesis by the way for oil investors recently where oil was actually too low and it was actually going to cause a supply shock in 2030 was the estimate. So the thesis of being long energy and all the guys in CM who are focused on commodities, they had the same thesis.
This was a known thesis. It was not like a uh you know, oh only a few people know about this. Now all the guys that were investing in energy stocks, you you were picking companies with amazing reserve lives, really low break evens, and you were simply just waiting this out. Iran was just like awesome because for those investors you got so much of your returns all at once, right? Um because if you look at some of these energy energy stocks, they uh doubled, tripled, etc. depending on how you played it.
>> Okay. So then, yeah, >> what you fascists can never answer is how come how come their profits always go up when price goes up?
>> How come the price the profit >> Yeah. If if if it was really if oil was really getting more expensive, they wouldn't be making record profits.
>> One more time. One more time.
>> So Exxon Exon's always like, "Oh, oil's so expensive, so I got to raise prices."
But then they always make record profits. So >> wait, what? Oil's so expensive. I got to raise prices.
>> That's That's why gas went up.
>> Cuz oil is so expensive. I got to raise prices.
>> Yes. So why?
>> That's the part that's Wait, are you You're joking. I know >> he's being sparse. He's joking.
>> Well, I do want you to explain it because that is what everybody says is if >> basically they're saying the price increase is made up because the oil companies are making record profits when the when the price shoots up.
>> I I just don't that that's like having a conversation with someone saying like this the sky is orange, right?
>> Yeah.
>> Do you understand why why an average person would say that?
>> No.
>> You can't even comprehend that.
>> No, it's too dumb. I I don't think that you know I think a lot of people have never taken an economics class.
>> I think I understand.
>> Okay, so you're saying that Okay, let's let's let's say it's cookies. Let's say I sell cookies for a dollar per cookie, but now flour, sugar, it all gets more expensive. So my costs go up and I have to start selling cookies for $2.
>> So So gas it was like $2.
>> Oh, they're thinking it's an input cost, not input cost. It is the product.
>> So it's product. So explain explain to the Redditors out there why would gas prices go up if the cost are not going up as well.
>> It's a commodity that that it is the >> but they don't they don't understand that part. You need to come down a few levels Fabio.
>> So so the the cost to extract isn't moving too much right that actually is staying fixed. So they don't need to raise prices would be the the the argument.
>> They sell at they well some not to get too complicated. I'll keep it simple and just say they all sell at spot. They sell at spot price. So it's like an auction, right? It's a commodity. So Cole and Strongman, you guys are let's just say two different countries. I'm I'm the oil maker. And then Strongman's going through an energy crisis. He needs to power his his uh electricity. And he's just like, I'm willing to pay $5.
you're kind of chilling right now and you're like, I'm not willing to pay $5.
I'm still at like a $3. So, I'm going to give strong man. I'm going to sell basically all my strong uh oil to strongman. There's going to be, this is a dynamic market, so there's many, many, many other players and it's like a, you know, bidding system where there'll be an equilibrium price where your your average price of oil that you pay for will go up and strongman perhaps when he's out bidding you, you're going to have less supply go to you and that will eventually, you know, cause that mechanism. will be paying a little bit higher cuz you're competing against not just strong man because this is too simple example but >> he can't compete with me.
>> Yeah, >> I would just Fabio >> now and there's other well there's many many other parts of this. It's too simple of an example but it's trying to explain.
>> All right B the answer is supply and demand and basic economics. All right let me address this comment. Okay, strongman. I have attended as a member for days and you have never read my comments or invited me as a panelist.
Maybe too big of a chick to handle.
Membership entitles you for me entitles you to have me read your comments. Okay, so clearly that's not the case. Number one. Number two, you don't become a panelist by becoming a member of my channel. Do you do you see like 80 people on this live stream right now?
Absolutely not. Okay, this is the real rabble. The real rabble is a select group of individuals that have been doing this for a long time that come talk. Okay, if you want to call in later, maybe I'll do a call-in stream and you can pay me money to talk to me.
Okay, so that's that. Anyway, I want to get this big ass comment off the screen.
>> I was like, I'm gonna >> from a big ass woman.
I'm gonna find the biggest one and just cover Fabio's face.
>> Somebody post a big comment.
But yeah, that so like circling back price of energy. It's it's um it's going back to where I said was equilibrium or the estimate of where I said equilibrium was. So, I think we talked about this literally the last route rabble where the equilibrium price of oil longterm or medium-term long-term who knows um is perhaps around like the the 70 to $90 a barrel. Uh that's where producers make enough of a profit there's enough incentive to explore and you don't have demand destruction because who's getting absolutely railed right now is not you because I imagine you know you're paying the Yeah. Okay.
Yeah. True.
It's poor countries like they're getting railed because you're making an income but you're making a a first world income.
Um and like you said you recall a time in the past where you were paying this price oil but I also presume your income has gone up.
>> It has.
>> Well mine has gone down but >> on average yes >> on average. Yeah. most people their incomes have have increased since then and you know due to real wage growth and you know part of that also inflation. So so the percent of spend on energy as part of a household budget has actually gone down uh equal price of of where it was back then. Some people never experienced that. So especially younger people don't remember the younger you are that you weren't driving. You weren't paying for gas. Mom and dad were and they were driving you around and you you had no conception of like where or concept of where gas was, but uh you remember, oh yeah, gas was like $2 a barrel or not $2 a barrel. Sorry, $2 $2 per gallon.
>> Wow.
>> And then now you're like, oh, now it's $4 a gallon. This is awful. But you know, you you at least good to know that you've seen it at four and you've seen it now at at at two or three and now you're seeing it back at four. So, >> I mean, the people's complained. It's it's it's simple. I mean, before the war, gas was low.
>> Yeah.
>> Trump bombs Iran.
>> Gas.
>> So, I mean, it was Trump that did it.
And that's why people are upset about it. I mean, like, do I think the gas prices are going to be this high forever? No.
>> But clearly, the whole catalyst of the gas prices going up was was Trump and the United States. So, and that's literally what people are mad about. And they're right.
I mean, I don't know how you could argue against that.
That's just what people are are are thinking about when they're when they're saying gas prices are high. I mean, obviously, yeah, if you adjust it for inflation, Yeah. Yeah. I mean, it's it's not that bad, but that's not the perspective people are taking.
>> No. Exactly. It's like a losing argument with like a gamer who's complaining about video games still being $60 for like 30 years and they say, "Oh, I want to increase it to 70." And they're like, "You greedy corporations. I can't believe you."
>> Now, that's funny because I remember when I was a kid, like 10 or whatever. I was playing N64.
Games were 60 bucks back then.
>> Yeah. 30 years ago.
>> Yeah. It was Holy [ __ ] So, I mean, some things I mean, inflation is not a universal thing. I I don't think people understand this. Some things actually go down in inflationadjusted terms. There's only certain things that are inflating like college tuition, health care, uh gas recently.
But uh I mean for me personally, as long as you kind of avoid those things that are massively inflating, >> yeah, >> you really don't even feel inflation.
Like I don't feel like inflation is bad because I'm not paying for the things that have been inflating historically.
>> Yeah.
>> Yeah. I I I I see those comments all the time where like if if inflation numbers come out they're like oh inflation is 5% or something and uh there's some some like oh the price of this goes up 10%.
People are like well inflation's only 5%. So the other 5% is literally just greed. Like they just invented that.
It's like it's it's inflation doesn't cause the prices to go up. The prices going up causes the inflation.
>> The answer is actually it's extremely complicated. A multitude of factors.
>> That's also >> too much for for maybe it will break a Redditor's mind.
>> I I also I also I do this with a lot of things, but when people say like, "Oh, the the inflation numbers they came out with were uh they're lying, you know, or they're wrong about the inflation numbers." I said, "Okay, well, you make your model and you tell us what number did you come to and then I'm going to apply it to with all the criteria that you do where everything has to go up exactly by that percentage. Let's see how well you do."
>> Yeah. Literally, when inflation is 3%, that means literally everything goes up 3%.
>> That's how they think.
>> Yeah.
>> It's obvious like you go to a store, you see a big TV. Massive TVs are insanely cheap now. Mhm.
>> I think there I think the price has come down in nominal terms over time, not just like in inflation adjusted terms.
So I don't know how people miss that when they go to the store and they see some things haven't changed prices for like 15 years.
>> Look there there's also the the US long-term is is benefiting tremendously from this environment I think more than people really understand. So if you been involved in the trucking space, if you follow, you know, folks like Craig Fuller, uh if if for example, uh I have to disclose this, but you know, we we went long trucking last year.
>> Where'd you go?
>> Uhhuh. Yeah.
>> And the the thesis was a lot of this like re-industrialization is there was data suggesting that this was was happening and Keep going. Keep going.
Inflation is a buzzword for armchair parasites.
>> Yeah.
>> Does that include me? Are you calling me an armchair parasite?
>> I think he's more so referring to the doomers.
>> Yeah. Yeah.
>> Here's what I'll say real quick about doomerism.
>> It's fun.
>> It is very fun.
>> I like reading doomerism. I don't believe it, but I think it's awesome cuz like saying that, oh, everything's going to be okay and stocks are going to go up 20% per year. We're all going to be wealthy. That's boring. Okay. I want economic collapse. I want grifters screaming in in fear and rage as their portfolios collapse. That's fun.
>> Okay. And that's never going to change.
I I like the um you'll see this on the uh you used to see this on the investing subreddits where uh because we had a bull bull market for so long. Um literally anybody would go on there and ask for investing advice and people would be like just dollar cost average into an index fund and when you retire you're going to be rich. And like the moment the market comes down like 3% off alltime highs they're like I win all cash. They're like this the end, you know.
>> Yeah.
>> That's why I could never manage people's money. I I don't know how you do it, Fabio. I could not deal with emotional investors.
>> Well, it's constant [ __ ] trying to explain to them like long-term concepts.
>> No, I I'd say the our RLPs, we're very lucky in that. So there's a there's a fund manager out there that said this as well.
Selecting the right manager, it's it's very important. And then the reverse is also very important. The manager selecting the right LPS because they become partners.
>> I have a request. Can y'all talk about the housing market? Will it get better or worse? Will a broky like me ever be able to buy a home? Go.
>> Yes.
>> I This is This is my my general idea that it sounds right, but I don't actually, you know, I I didn't look into this. I didn't bother getting any info or anything, but there's a uh a worrisome, you know, there there are two things that are at odds here. People who want to buy houses would obviously like cheaper housing prices.
Uh people who already own homes would like more expensive housing prices. So, I I I have a theory that if we wanted to in the next 20 years, we could probably like half housing prices by just making more housing. Um, but that would upset people uh that own homes. Yeah, >> it's nuanced.
>> Yeah.
>> Sorry to That's what I want. That's what I want, Fabio. Nuance it.
>> Okay. Because land housing is a commodity to an extent.
>> Mhm.
>> So, let's take let's say there's an area with a lot of water and lakes, you know, lakefront property.
>> That land after it's fully developed, there's no more of it.
>> Yeah. Yeah. Right. And so that land if you want to live in the lakefront property, you need to pay what everyone else is willing to pay. It's still an auction. It's supply and demand. If enough people want to live in the lakefront property, then those prices can still maintain. You can talk about prices in aggregate. There will be options for you.
>> Mhm.
>> Where it's not a lakefront property. And that comes with like, you know, other dynamics like that area that you're living in. Is it an economic hub? Are a lot of people trying to move there? If there are a lot of people trying to move there, they all want a place. If they want a place, they have the same desires as you. You're not special. You're not someone who's just like, I'm the only one who wants a lakefront property. No, a lot of people would look at each other and say, I also want the lakefront property or the ocean property or whatever. And so you you'll see like in various parts of whatever state x state um land after it's used up >> there's there's no more it's gone right.
>> Well that's why that's why I invest in land because now I'm making more of it.
>> Yeah. So so it's a commodity to an extent. We can build a ton more and then you can have options but that doesn't that option that's out there doesn't mean that you necessarily want to live there. That's like, you know, your own fault at that point.
>> People still want to live in Manhattan.
>> Yeah. Yeah. It's like, I want to live in Manhattan. It's like, okay, >> here's my advice for housing. Okay, this is very simple. Don't get a guest bedroom. We've already talked about this. If you don't have a guest bedroom, you're going to be way more wealthy. And then number two, if if rates are higher, save more of a down payment because the the higher the rates are, the more you put down, the much lower your your mortgage payments going to be.
>> So I I don't think houses are out of reach. I just think people want more house than they could actually afford, number one. And then number two, they're not putting enough down.
>> The higher the rates, the more beneficiary a down payment is. I I I think we can we can admit that housing is pretty crazy in ter I I get that there's areas people Fab's gonna disagree, but I I I get that there's u there's places like Manhattan or stuff like that where everybody wants to live there, so it's going to auction up. But even even for um >> even if you're like, well, I'll I'll give the area a bit.
>> Um still, I would think very high. Um, I just I just feel like we can build more housing.
>> It's high.
>> It's high relative to where it was. Like when I bought, I just got lucky.
>> Super cheap. Low rates, affordable prices. Now that rates are higher, if if you're comparing to that low, yeah, houses are outrageous. But >> I don't know. I I mean, I don't know. I wasn't alive back then, but I imagine when rates were a lot higher, you know, a couple decades ago, it was probably pretty expensive to buy a house back then, too. So, I think we're just spoiled by anchoring bias back to 2019, 2020.
>> And I got to feed the dogs, by the way.
So, I'll be I'll continue it. Well, Fabio, so it just seems to me that we've had so much um economic progress and and I get that per, you know, I know the statistics about like per square foot and everything, housing is actually cheaper cheaper than it was decades ago, but um it I have this feeling like we could focus in more on building housing more cheaply. Like it it just seems like it seems like that's on the back burner in terms of technological advancement.
And I don't know necessarily how you would make it cheaper, but I'm sure somebody could figure it out if it was a top priority.
>> No, there there there exists. It's just some people don't want to buy it.
>> Um, but housing affordability is similar to like the 1990s right now.
>> Mhm.
>> I I can produce a report for you later.
Same similar to the other one if you want.
>> No, I wouldn't care that much. But um no because I'm guessing a lot of people also want to see that or know about it.
But yeah, and there's like a lot of nuances like cuz I I got into this exact same discussion with with someone else but it much more back and forth and elaborate in um CM. So I already have it saved in my notes. I did the necessary research to actually get that and I maybe I find it quickly. But >> let me let me run a pure. This is kind of like the first thing I said when the housing discussion started. Yeah, I mean that was just like five minutes ago. But to my initial point, and this is pure hypothetical, but let's say that tomorrow we just invent. It's a magical orb and it makes uh it makes housing half as half as expensive. It just it's a magical orb that can just make a bunch of housing and housing is super cheap.
Now, there would be quite a push back from people who do own homes already that would be like, "Well, I don't want my house to be half the value."
Now, I can I can run that back again in better wording.
>> Yeah. I mean, sure.
>> Well, do do you think that do you think that is hindering uh progress in developing housing? is just that people are like, well, I don't want my I want my house to be valuable, so I don't want a bunch of like extra better housing for people.
>> I mean, yeah, in in areas that are already densely populated. I mean, you might be saying you might be talking about like not in my backyard, Nimi, >> to an extent.
>> Don't don't build that affordable housing. Don't build that affordable apartment complex near me because then >> it lowers the property values.
>> Yeah. So, I think both sides are right. They're just different people. Um, you know, kind of kind of kind of like, you know, if I'm a retiree, I want stocks to keep going up because I'm selling my stocks.
But if I'm working, I want stocks to go down so I can keep buying cheaply.
>> Yeah.
>> Echo did say he would like that report you were talking about about housing prices.
>> Yeah. be hard to produce.
>> Um, >> and and this >> I'm trying to see if I can find my notes fast.
>> Yeah. While you look for it, this is why everyone um people talk about, you know, inflation like it's so easy to calculate, but part of why inflation is so difficult to calculate properly is, you know, if you just look at the cost of uh cell phones, obviously cell phones have gotten way more expensive. I mean, way way more expensive than they used to be. But I now no longer have to purchase a camera. I don't have to purchase a video recorder. I don't have to purchase uh a lot of stuff. I don't need to purchase like pen and paper. I have the notes app. And and the camera on the iPhone is better than most cameras you'd be buying anyway. So it's like, well, how do you calculate what the inflation on phones is if it takes the place of 50 different devices we used to?
>> Yeah.
If I don't find it in the next five seconds, I'll put this.
>> You'll kill yourself.
>> Uh because I have to search there. There's also a discussion on relative pricing of housing by the way.
But um more expensive.
>> I have to find what the key word was.
>> Now I will say >> because I didn't think I would have this conversation again. S.
>> No, you're good. Good.
>> It's very interesting watching.
>> My members ask you deliver.
>> Have either of y'all watched um the Jeffersons, the old sitcom.
>> The Jeffersons.
>> Yeah, it's very funny. I've seen the Jetsons.
>> It's not the Jetsons, but in the Jeffersons, the intro is very funny to me because it's uh it's very fancy. So, they used to be poor, but then now they're rich now. And the whole intro theme song is about like and now we're moving on up. moving on up. Like it's very like positive and everything and they're so rich now that they could move into like this nice apartment. But it's funny to me that they are moving into an apartment. Um because like nowadays like a a Gen Z a zoomer on Reddit or Tik Tok would be like I don't want to live in an apartment. I need to own a home and stuff. But then I watched a sitcom from I believe it's from the 70s and they're like wow look how nice we are. We have a nice apartment now. And so >> okay >> found it.
>> Go ahead. But it's but it's a lot. So it's like okay we got to piece it apart though.
So um all right I guess like where where do we begin in the discussion? Where do you want to begin?
>> Um why is housing so expensive?
>> Well housing so expensive for a couple of reasons like are you look are you talking about a per square foot basis?
Are you talking about an absolute terms?
because for one you know we do have ju speaking inflation you have to expect some kind of inflation across the board >> uh and then you have the financing component and so across you know US's history that's been different so a lot of people point to like the 1950s uh I don't even need this for that's off memory so in the 1950s right the financing ability or capability of most households was not nearly as robust as it is today you had to put massive down payments in in order to do any sort of financing and interest rates were also vastly different. We also did we didn't have we had similar to some other countries maybe even you could look at some third world countries today what we have back then in terms of the um financial system supporting everyone just getting a mortgage today it's it's fairly easy for you to get um a mortgage comparatively and from a financial >> what now what do you mean by it's easy just you mean the lower down payment >> oh you have no idea how hard it is to get a mortgage in other countries you have you literally what what's the what's the offer? What's the difficulty?
>> So, the US was very creative in how it structured the you know, for example, first-time home buyer programs, which is a lot more accessible than in other places. If you want if you go to some third world countries and you're trying to, for example, get a mortgage on a on a property, good luck. Um, for for Americans on a comparative basis, much much much different. Um and that's that's a whole other discussion by the way on the comparability. Uh so comparable to other countries and relative to their incomes and their housing the US is actually extremely affordable. What I als when I mention that is just to say if you think this is bad it could get way worse like way worse. We have way more room because other countries have proven that that technically is sustainable. That's not good. I mean like I won't I don't want that future but that worse is definitely sustainable for many years before things break because other countries haven't broken.
>> But what what's the what makes it so difficult in other countries? Is it just the down payment or just the process of getting the >> both? All of it. The down payment is a function of the lender not wanting to give you the money because you're too risky.
>> So you're just saying it's harder to qualify is what you're to qualify for.
If I if I want you to put up bigger down payment, >> it's because I'm trying to reduce the risk of the loan for me.
>> I don't trust Oh, it's not that I don't trust you, but there's a multitude of factors that might be barring me from uh thinking about the risk appropriately with you.
>> Now, can you tell me if this is in your data? Because I would have thought, you know, because we just a few years ago, we're at like 0% interest rates. Um, so as as interest rates have gone up, I expected housing prices to come down because buyers have, you know, less ability to finance more money because they have to pay a higher interest rate.
But it seems like housing did not go down in price even as interest rates went up.
>> Yeah. Supply and demand.
>> Is that because nobody's selling? I mean, because like if you locked in a low rate, wouldn't you be insane to That's how I think. I'm like, I'm not selling my damn house. I got a low rate.
That'd be crazy to sell it and get a higher rate.
>> Yeah, there's a reset. So, existing home sales collapsed. Um, and home sales in general, there's not a lot of volume.
So, most of the most of the volume's coming from new home sales. And new home sales are still pretty uh pretty robust.
They could be better and they they've pulled back some uh but they're we're going off of like insane figures that we saw in like 2021.
So, you pulled forward a lot and you have to have like a reset. There's there's a a rough estimate of like how long that reset takes, but you have a a disgusting amount a percentage of the American population that has still uh really good equity levels in their homes and low low cost. So, that the reset happens from just like people eventually do need to move for life-changing circumstances, etc. And the recency bias also locks people into the mentality, especially if you're a normie, like, oh, interest rates were 2% before, I'll wait. They don't know or understand uh why things are the way they are, why that things happen the way they do, and they just think to themselves, I remember interest rates were 2%. I'm not going to buy a house until they're 2%.
>> Yeah, that's not happening.
>> A lot of people like that. And then they're just going to save save save.
And you know, we've had um the a there was a stat. We've have a record amount of, you know, cash saved as part of people's net worth. I think the last time we saw this like 1950s.
Um so, go figure. There is a lot of pent-up demand. The way you know that is when there was like a slight drop in interest rates. I think last year in Q1, uh there was a there was like a fake out for a lot of these mortgage originators.
So, the fake out is what I mean. You saw interest rates drop a tad bit and then volumes exploded >> and then >> everybody was waiting for that.
>> Yeah, exactly. Volumes exploded.
>> So, >> can I can I read this one?
>> Yeah, of course. To this.
>> This is not like an impression of Echo or anything. This is just my I'm going to do a fancy I'm a I'm a fan of Echo.
I'm just going to do my fancy like announcer voice.
I don't know why.
So, will home prices, sorry, hold me.
So, will home prices go up or down in 2027? Is there anything Trump and Kevin Worsh can do? I'm not trying to pay $3,200 a month for a three-bedroom home.
>> Damn, you need to move, dude.
>> Oh my god. I mean, >> I know where he lives home.
>> 4 500K.
>> You need to move, dude.
>> Yeah. There. And it's a function of everyone else also thinking the same way. They want to live there.
>> Yeah.
>> The land's already developed.
>> I don't know if y'all read the comments, but Eko is mentioning that it the most important thing to him was being in a good school district because he lives in Chicago, so I assume the bad school districts are very bad. Uh I watch Fox News, so it's my opinion of that. So, but I of course everybody wants to live in the good school district. Um, but you know, we can explain the economics of it, but I guess it's not really gonna help him because he he wants to live in the good school district. So, but everybody does.
>> Yeah. He has to balance economic opportunity because depending on his career path, etc. The economic opportunity might just be in Chicago >> and the but also at the same time he has to contend with the fact that others who are in the similar position also find their economic opportunity in Chicago.
Everyone wants to live in Chicago and it's hyperconentrating a massive population in a small area. This is a natural consequence of that. Of course, prices are going to be high. Of course, there's going to be a a floor because there's a lot of people wanting to live, wanting to buy. And so, you have a lot of pent-up demand. So, there's, you know, kind of like how I described the mechanics of demand destruction and how that impacts the the upward trajectory of oil. Well, the same thing happens in housing in certain areas. If if we're talking about housing in the middle of a bum [ __ ] nowhere and you're you're you're the marginal that's the marginal supply of housing that is going to be hyper sensitive right hyper sensitive to things that happen because like that's the middle of bum [ __ ] nowhere. So people are maybe only buying there because the that's the only option right as an example. But in place like Chicago that is for a lot of people their first choice.
>> So inherently after the prices react for so often in a short period of time lower and assuming the economic opportunity hasn't changed in Chicago because you could have cities that the economic opportunity does change and that's that's a difference that's a distinction here. Then at that point, you you have a lot of buyers that are ready to swoop in. And so that that's like a floor on on pricing because a lot of people do want to live there.
>> But but when when people want more iPhones, Apple just makes more iPhones.
So I guess in my head, I'm just picturing like why do we not just have massive skyscrapers like in all the major cities? I I know we do to an extent, but like it just seems like it seems like this is solvable in my head.
skyscrapers.
>> Yeah. Just like giant like you just very dense living and it just seems like it seems like we're not getting that.
>> New York City >> Sorry, what?
>> Manhattan.
>> Yeah. But in in in >> everywhere >> more of the US like Chicago for example.
>> Yeah. Look, this this is my this is my pie in the sky. If it seems like if we really put our minds to it, we could have fixed this. But >> yeah, but there there are there are other like limiters. It's I I know. Yes.
Like in theory, right? That's the key word. In theory, >> this is solvable to an extent. But you know, you know what happens? Because assuming it is a desirable place to live, assuming it is. You do that, you build it, they will come.
>> Yeah. It's kind of like It's kind of like when you build an extra lane on the highway that helps traffic. More people just driving.
>> Exactly. Thank you. Exactly. You build it, they will come and you build all these skyscrapers. It will it will help the initial, right? So it's like, oh, there's a lot of supply coming online and there's not a lot of new people moving in. So, you know, in Echos, he's like, oh, prices are there's some options, right? There's now some options forming and I can go take advantage. But in the future, we'll go back to almost like the same problem >> cuz eventually that supply if it's such a desirable place to live because that's the key. It's like it really depends on the dynamic and inflow of economic opportunity. If the economic opportunity keeps growing and growing and growing and growing and more and more and more and more and more people eventually you still just run out of the land again.
>> Well, are there more of it and then >> well I mean are there are there is the government stopping developers to some extent at all?
>> Yes. Oh yeah. Yeah. Like again this is multifaceted. It's not simply like you know um all good all bad. It's it's it's complicated but yes with governments getting involved and and preventing some of this um other parts it's u uh lack of availability lack of land. So like I'd say um you know in a thousand years into the f or no this maybe too far 100 years from now some of these cities will be even more dense.
Yeah, >> for sure.
>> I just probably similar problem.
>> Let's read our two donations. Let's get that out the way.
>> Hillbilly Steve. If you own the land, plan to never move. Buy a double wide. I don't know about that. I got a 2100 foot house. Five beds, three baths. Six years ago, 100K after. Damn, you put a lot down, dude.
>> Let's Let's see. Let's all let's all read this in our best kind of hillbilly redneck voice and we'll have the comments vote on who reads it best. So, strong man, do you want to go again on your >> If you own the land, plan to never move.
Buy double wide. I got a 2100 square ft five bath three bath three bath six years ago. 100K after financing. No issues or regrets.
>> All right, Fabio, do you want to go or do you want me to go second?
>> Cole, go. Yeah, you go.
>> I'll go. All right.
>> If you own I don't know if I'm gonna do well. Strong. You did well. By the way, so if I do badly, it's because you did so well. You set the bar so high.
>> If you own the land, plan to never move.
Buy a double wide. I got 2100 square foot, five bed, three bass, six years ago, 100k after financing. No issues or regrets.
>> I'm not gonna do it that way. I knew it was >> I would love I would love to hear Fabio's redneck accent.
>> If you own land, plan to never move. You see >> if you own land, plan to never move.
>> There you go.
>> Five double wide. I got 2,100 square foot, five bed, three bath six years ago, 100k after financing. No issues or regrets. If you if your plan to solve the housing crisis is to buy a double wide, you might be a redneck.
>> Well, I agree with that. I agree with everything except for the double wide.
That's That's one I'm not going to live in a double wide. Not going to happen.
>> He'll he'll marry one though.
>> Do what?
>> You'll marry a double wide.
>> Uh that's not happening either.
>> They they usually become double wides after you marry them. Oh yeah. Yeah.
They have to >> one way or the other. I guess >> Echo also donated a $1.99.
>> It's because only a few areas have good schools.
>> All right.
>> There's only a couple solutions, dude.
Like you you either move or you make more money or you put in a massive down payment. I mean, if you're dead set on Chicago, your only answer is just save like crazy and try to make more money.
That's your only answer.
>> All right. All right. But if if you're willing to move, >> Fabia, read this comment in your best black accent.
>> I I need a I need I need a contract explicitly for Mecca.
>> Look, it's okay. It's okay. We can make fun of how poor white people talk.
That's okay. Um >> this is America. You can't criticize certain people. Okay.
>> What do you mean by that? Because like there's some really rich white people that talk like that.
>> It's a 10. It's just a It's just a regional accent.
>> Yeah. They just happen to be poor and [ __ ] white people typically.
>> Well, you know, everything's relative. Um there's also, for example, I I don't know if you guys know about uh Wealthfront.
>> You guys know about Wealthfront?
>> Is that a asset manage? Isn't that like a What is that? YouTubers pitch them a lot. Yeah, >> YouTubers pitch them a lot. So, no, in their S1, which was was kind of interesting. It's like a narrative breaker. They actually point out that uh Gen Z on a on a relative trajectory is actually on the median is wealthier than than the prior generations.
>> That's not true.
>> I know. Narrative breaker. Complete narrative breaker. Um, and this is actually true for for most despite what doomer but doomers themselves. That's what I want to everyone's brained or like a ton of people are brain rotted uh to because the other one sells unfortunately uh if I tell you that those are not true. No one cares and people will defend the dumerism to their death. Um, you'll probably see it in the comments like defending to the death and yet things don't really uh necessarily agree with them. If they were to try to monetize their dumerous beliefs, they would lose money.
That's the reality.
>> I Yeah, I think I think what's happened is before social I know this is not an original thought, but um you know before social media typically people's family and friends were in the same social class as them typically. So >> you know you would see you know if you were >> in the lower quartortile let's say of income or something most of your friends and family would be there so you know oh none of you own houses so you wouldn't even expect that so you wouldn't be like oh my life sucks. Well no you look at everybody you know they don't own a house or something like that or oh everybody's struggling with with groceries and everything but no with social media you can see anybody. So, if you see that, oh, hey, I'm 22 years old.
I just bought a house. That's not a great frame of reference for how your life is going, but that's how you think of it. You're like, well, this person bought a house and they're 22. This person's 22. They make a million dollars. I'm f I'm an idiot. You know, my life is terrible. So, I think that's part of what's going on.
>> Well, you part of maturing is understanding that social media is [ __ ] and that it it's not a accurate reflection of reality because Yeah. If on social media, you're going to see there's always going to be somebody that's making more money or has a bigger house or whatever or whatever, but you have to actually look at your personal circumstances and look at the average person to really see where you're at. I I I'm going to like push back 1%. I I think it is an accurate representation to an extent. It's just you're comparing yourself against people you would have before social media, you would have never compared yourself to somebody in the top 1% of income. Like you just you wouldn't do that. But now that's all you see. So it's accurate for those people.
Those people really are that rich, that young and stuff and successful. But we shouldn't be comparing ourselves to them. It would be like if I like, you know, I see Ryan Gosling or something, I'm like, man, I'm ugly as [ __ ] You know, it's like, well, of course I am relative to Ryan Gosling, you know? Not that I'm gay for him, but the um I I want to ask you guys something because this is another narrative breaker. Do you think more people own homes today than before?
>> Well, you just said it was a narrative breaker.
>> Yeah, [ __ ] it. Yeah. Well, yeah, more people own homes today than before. Um I >> Yeah, cuz like there was there was a uh you guys might know Blake Blake Downer.
Um and he didn't really consumer look into this too much, but he he was under the impression that less people own homes today than ever before. It's not true.
>> And actually, when you compare to most countries, you'll actually be stuck.
Like I said, If you think this is bad, like holy [ __ ] hell is very deep.
>> Yeah, >> this is your hell. Like, oh my god, we have way more layers to go through. Um, but yeah, in terms of home ownership right now, we're like 65%, which historically is actually pretty good. And then also internationally is also uh pretty good. It's very good actually. Uh you could do way worse.
Like what's >> Yeah, but how how does that stack up for Gen Z? Like if you compare like how many millennials own homes at whatever the average age of Gen Z is now, like are the statistics different >> based on how much each generation has attained by certain ages.
>> So >> I think that's true to a certain extent.
>> So that I actually had that pulled up in front of me. So, first-time home buyers, a median age is extending a bit, but also it's the um uh it appears as though what the main cause for most people looking to buy a home is the part where they're trying to get offspring, start a family, which is also extending a little bit into like the early 30s. And that's been pushing further and further. uh you you could argue there's a multitude of factors that have contributed to that.
So it's not a simple it's tough to say because like like I just said for example Wealthfront they said their market opportunity is actually amazing because of the following that Gen Z and every generation before adjusted for inflation medium net worth is higher and higher and higher. um they're just talking about us because that's their opportunity set. And um I'll I'll say like um uh super anecdotal, but I I know a few folks like uh who work in military. Uh well, the one I'm thinking about, but there's I know I met his friend group and they all pretty much did the same thing. They they're they they're moved out now, but they were through their mid to late 20s still living at home, working corporate jobs, making tons of money, and they only moved out when they, you know, girl girl got involved. Girl get gets involved, they move out. Um, and >> culturally speaking, like that's a very, it's much more of a US phenomena that, you know, you're 18, go, leave the nest.
um the uh many other cultures around the world uh for multitude of reasons because there's like a more of a you know take care of your elders etc more like the the unit of family might be a little bit different um but there is that like establishment in um I think for example when I speak to Indians right they are very much that why would you do that also very much that no I'm not naming a bunch of >> so they'll work like um and the the the few that I'm thinking about, they're Asian, right? They're Asian. And they were uh you know, for them it's like completely uh strange to them that you know, you would leave to pay rent versus stay, make money, save, then buy.
>> Yeah.
>> I mean, they're actually right. I mean, I think it is like, oh, you got to move out at 18 and pay in inflated rent. And because if you're paying rent, Yeah.
you're never going to be able to buy a house unless you make a [ __ ] ton of money.
I'm gonna for one trillion% do like my kids I'm gonna say like you know yeah you can you have to work like you you do have to work like you do have to be making money uh there's no way in hell like you're you know staying here and you're not making uh money >> make money and whatever you're not paying in rent save it and then buy yourself a property you meet a girl you meet a boy I don't know if I have a daughter um >> well what if what if your son likes It's the whole question of thought daughter, gay son, you know, like >> Yeah. Yeah.
>> Obviously.
>> No, my my plan is like as long as my kids aren't a pain in the ass, which you never know. I'm going to let them stay.
I'll charge them a little bit of rent so I get to boost my passive income, but you know, then they Oh, of course I'm gonna do that. And then uh but then they could still save >> and then when they're ready to move out maybe two or three years they should have enough if they're being frugal to Yeah.
>> buy their own house.
>> What I would in their 20s.
>> It's a huge boost for sure.
>> So my my parents and this is part of this is you know the free market. You know different people have different wants. My parents had no problem.
They're like yeah you can stay at at the house. They had no issue with that.
>> I val I more than valued paying the rent to live on my own. I I valued having my own place that much. So, you know, I could have stayed and probably had a down payment by now, but I I really liked living on my own, so that I was willing to pay the rent. Some people >> It's harder to do it when you're older, but like when you have an 18-year-old, it's probably a little bit easier >> and it's more beneficial to just stay home, but it I I do agree. Once you get older, it's hard to go back and live with your parents. Even even like at >> I I stayed my first year of college I stayed at um well actually my first year I stayed in a dorm but my sophomore year of college I stayed with my parents and I'm like I want to move out but I think if I was a parent um what I would probably do is kind of like what you were saying I would charge my kid rent but it would be like way under market value. I'd probably charge maybe like $200 a month or something just because there needs to be some kind of incentive. They're like, "Hey, you need to budget for this much money because I mean going from it's funny the the and I think we all know this um just a personal finance thing.
>> The everybody I know, especially younger, the ones who have an apartment and pay like they pay $600 a month in rent, $700 a month in rent, roommates obviously, and the ones who live at home and pay no rent at all, they all save the same amount of money.
the the one who lives with their parents just blows the $600 every month. They find a way to do it. Um so I you know it's a huge jump to go from oh I never pay from housing to now I have to pay for housing. So I charge them a very discounted price just so they know like oh you know once a month I got to pay to live somewhere. So then it's not a huge shock when they move somewhere.
>> Well and for me I already talked to to my girl about this like we would do we would trick them. So, because we we Exactly that, but we actually won't actually charge them. We're going to take that money, hide it, pretend like we're, you know, it's gone.
>> And then when they move out, surprise.
But, but we can't tell them because they have to think like it's actually like, oh, that money's gone. You know, >> well, that New Zealand guy has already clipped this and so he's going to send that to >> Oh, [ __ ] Like, if they ever see this, they're the whole plan. The jig is up, boys.
>> Man, Fabio's nice. I I'm I'm 100% taking that money. strong man comes home with 200 lotto tickets. You know, >> I mean, for whatever.
>> Tax season's over. I need money, children. Let's go.
>> Let's go, >> my little pay pigs. Good morning, my little pig.
>> They're They're finally going to pay me back. I'm going to spend a freaking fortune on them.
>> You're making pancakes downstairs.
You're like, "Good morning, my little pig."
>> Oh, I'm not making pancakes. Oh, they're doing all my chores, too.
>> Pancakes are $10 >> for pancakes.
I will.
>> Once you once you have kids, like young kids, and you just see the amount of work and cleaning you have to do, you might you might change your perspective a little.
>> Oh, no, no, no. Like the chores thing, of course. No, like of course that's that's expected, right? That's not No, no, no. It's not like they're not going to be doing nothing at all. They're going to be doing chores.
They'll pay if they're making money.
They'll pay like a fake rent. I guess like if they're over 18, I'm talking about over 18. if they're having like a high school job, I'm going to let them, you know, have their fun because I want them to also enjoy uh some like childhood cuz I still consider under 18 like, you know, you're you're having fun, you're going to house parties, you're doing all your things responsibly, >> but I want them to have that, you know, enjoyment. They make their little money working their retail job or or fast food job or whatever. They'll learn like the basics. Oh, this is responsibility. This is a schedule >> and I get money and oh, money is nice.
Hillbilly is right that that's a it's it's a real thing. Your your kids do have squatter rights. If you want like hey, you know, I'm kicking you out. You do have to give them like an eviction notice and stuff like that.
>> I'd be like, get the [ __ ] out of my house. I don't care.
>> I'll literally drag him and throw him outside or you're going to call the cops on me. Oh.
>> So, let's address this comment. So, keep in mind we have the highest property taxes. Yeah.
Well, you you got family in Chicago, so I guess you're just going to stay there.
So, the the only solution is you got to make more money and you got to save like a madman. That's literally the only thing that's going to work.
>> Mhm.
>> Still here. Run. Run for mayor, dude.
Get it fixed.
>> Run for mayor.
>> He's got a political background.
>> Good school. Oxymoron. It's all relative. Okay. There are better schools, but yes. Most honestly like I don't even value high school education anymore.
Like if my kids get B's and C's I I'm not going to give a [ __ ] personally because I I think there's more most of life skills you're not going to learn in school. Like personal finance, how to do basic [ __ ] you're not going to learn that in school. And even if you don't get amazing grades in school, you can just go to a community college and it's super cheap. I have one that down the road that's like 150 per credit hour or even cheaper than that. I I don't think high school necessarily matters that much unless you're trying to like go to an elite university and join the the rich class.
Uh, I'll I'll add I don't know if the same thing works in Virginia uh or where you're from Cole up north u but um you know in in the state of Florida at least what I imagine it's the same thing because it's a public school system but you can do dual enrollment >> and I I would probably So what I'm gonna I'm plann on doing this is so so far enthus I don't even have kids yet but um when I when back like uh many years ago at this Right. Um I had a tutoring business and um essentially like I I helped a lot of kids get through these programs, right? And I and a lot of parents didn't even know they could do this. And so when I introduced it, it's like I was I was like showing them the fountain of youth. They're like what? Uh because you can basically if your kid is actually, you know, very good student, etc. You should still want them to have like a high school social race and and the high school becomes a social thing >> like they go to school for like electives and they you want them to socialize, make friends, go to house, you know, all the other stuff because that's super important for building like character, etc. yada yada.
>> Um, and the the other parts like you can make them do their their math class, their their other stuff in this dual enrollment program which is free. it's paid for by the same program. And you can actually get them enrolled in either community college or a uh state college.
Again, that will depend on if they get accepted or not, but the community college for sure. And they can do it in high school and get through basically all like the classes. Again, this is like if you think your kid is cuz you don't want to hurt them. Like if if it is like very challenging, it could be harmful and they they just need like a little bit more time to go through the things. But if you think they're a little bit more accelerated, you can put them through this and they're going to be dumb classes. Like especially when they go to college, they'll have all like the the general ed stuff done and that's money they don't have to pay.
They don't have to pay that college for philosophy. They did a philosophy already.
>> I I wish I had that option cuz like when I when I was in high school, I was like on a military base overseas. So they required us you had to take full credits in the high school. there was no like dual enroll enrollment. But I I think in the I think that's in most states at least like domestically and that's a great way to do it and it saves you a [ __ ] ton of money because like the biggest scam of college is the the first two years >> because you're just taking all the you're basically just taking the gen eds again >> that you already know.
>> Exactly.
>> Get that done before you go to college.
You just pay for two years. you can even go to a nicer school because you don't it doesn't cost as much money because you're only paying for two years. So, that's definitely the way to do it.
>> And the other way I think about it, because it's it's kind of insane to me that uh and I'm thinking about this for like my kids, um I want them to have the opportunity or option to explore what it is they want to do. Cuz I feel like you don't actually give them a ton of time to do that within reason, right? There there's like people get carried away with this, but within reason, I want them to get all the stupid [ __ ] out of the way and then they can taste different things. They can say like, "Oh, I'm actually super I thought I was interested in this, but I'm actually really interested in this."
>> Yeah. As long as it's not like, "I was interested in women. Now it's men."
>> Yeah. Exa. Exactly.
Um >> I've been there.
>> But you know, if they if they get all the [ __ ] out of the way and they start like, "Oh, I thought I was like I'm like my dad. I'm into I'm into finance and accounting and then they do do their finance and accounting class like I [ __ ] hate this but I'm really interested in engineering and I'm like okay son daughter like yeah go for it like cuz you you have all the basic [ __ ] done like you can take a finance accounting class figure out you it's not for you and then take this other thing and you didn't really well you you get a little bit more of a buffer is what I'm getting at which is super important I think that's that on top of the other savings is super valuable and then at least in Florida we have bright futures.
So, if they stay local, which I'll encourage them, I'll support them if they want to go out of state and especially if they especially if they were a good child to me, I'll be like, "Oh, you know, you were you were great."
So, >> or if they're a pain in the ass, you can send them out of state, too. So, you don't >> pain in the Well, if they're if they're paying me, they can go instate and just room and board.
But um if if they're, you know, uh I'll encourage local, but if you know, again, if they want to go out, they can go out.
Um and if they go local, Bright Futures covers the entire tuition.
>> Wow.
>> Florida. Florida. Move to Florida. Um but anyways, no, but also >> I wish.
>> I know, right? No, no income tax, by the way.
>> Stop. You're making me jealous. Stop.
>> Property taxes are coming down.
It's like, well, where's the money coming from then? You know, that's what I always wonder.
>> Well, sales tax. Um, yeah, sales tax.
There's still property tax. It's not like there's no property there, but sales tax.
>> They gota The money's got to come from somewhere.
>> Yeah. Yeah. Comes from you. Comes from when you come down here.
>> Uh, >> all right. Hilly says, "Why wouldn't you wellmade own land, never move?"
>> I I don't know.
>> Why wouldn't you own the land and never move? Well, I think it's saying why wouldn't you buy a double wide?
>> Oh. Oh, yeah. Actually, Cole, thank you.
Better memory.
>> I I don't know. May maybe I'm wrong about this. I just never appealed to me to buy a double wide.
>> Well, I'm too afraid of twisters.
>> Did you watch the the twister movie or whatever?
>> I did. Just in the last I I barely I basically never watched movies growing up. I I didn't watch too many, but in the last like two or three years, I watched more movies. I watched Twister and that was a a damn good movie. I I thoroughly enjoyed it and recommend it.
>> Nice.
>> All right, one more topic and we're going to close this out because I need to >> Oh, you Well, hey, if the money keeps flowing in, you know.
>> Yeah.
>> Any last topics? Uh do we talk about markets broadly?
No, not really.
>> Because that's what's I mean that's >> Will VT hit 165?
>> Thought you say one cent >> 16 because it's what's it at now? 158.
Are we going to 165 by the end of the year? Where do you think the market's going to be by December 31st?
>> Who can say?
>> I need the I need the call now.
>> Who can say? But it's it's it's possible. it it definitely is possible that it can get there. Um there there's a lot going on that's that's good at least for the US. We're talking about US. Um so like we were just alluding to with you know what's happening with energy, the reindustrialization is 1,000% happening in the US.
Um before like last year there was like debatable and you were more so creating forward projections.
This is less of a debatable topic right now.
Um, if you were betting against it, you probably shorted some things and you died because they went against you very quickly. Um, so if you look at, for example, flatbed, flatbed trucking rates, incredible.
I'll address super quick TSI. Nothing's changed for TSSI. Um, yeah, Dell earnings sort of confirms the thesis.
There's a lot of uh pent-up demand. TSSI is is Dell overflow. Dell's getting so much business right now, it's it's insane. So, should should be fine. U, but you know, just keep in mind that TSSI is Dell overflow. So, size your positioning accordingly.
>> Um, >> all in.
>> Yeah.
>> Yes.
But, um, no. So like the US is going through something that a lot of people are not um appreciating. Again, dumerism sells much better. And yeah, if you look at flatbed rates, flatbed rates tells you a lot about industrial investment. Um there was also the um uh durable goods index excluding cars. Uh this was I shared this with Cole actually months ago now. You remember that?
>> I bought I bought calls on trucks.
>> Yeah. But the chart that literally went like this.
So excluding cars, a lot it tells you a lot of investments happening in the US.
And people think, oh, it's just data centers. No, it's not actually just data centers. That's the crazy part. So um I'll give you some examples for what's happening with energy, chemicals, etc. Uh the US is actually very attractive place to set up shop because energy costs are so low. We're talking about net gas. So like input costs are actually really attractive compared to Europe and other countries. And there's also the uncertainty of establishing shop in another country clearly. So there a lot of companies are seeing that now. And so that's already started to have an impact. Uh Germany's a basket case right now for industrial capacity because they they they removed a lot of their their energy base. They basically deenergized themselves some way in some ways >> to fight climate change.
>> Well, that was a push for it. A lot of it we find out more. It's like Russians backed a lot of these organizations in order to for Germany to do that to themselves so that they would become more dependent on Russia.
>> But um that's more hindsight at the time. Some people argued it. A lot of people were like, "Oh, that's silly." Um but we know more now than before. And it's not like 100% their fault, but they did it to themselves. And it was just like encourage. It was like, "Oh yes, please make that mistake. Please be stupid." Um and so that's also biting them in the butt from the industrial point. Um there's a few plants that are closing, a few very notable plants that are closing. And then the US is building and building and building and building and building and building and you see that again flatbed rates. You see that in metals prices. Um so there's a lot of supporting evidence that suggests this is this is not a debatable um event or cycle anymore. This is this is happening. I I had I had like an this is I guess a different topic, but I had like an existential crisis yesterday of and obviously this is just an ongoing thing for me as I realized but I'm still shocked no matter how many years this keeps going. I'm still shocked at at how uh [ __ ] our population is and it's really like worrying to like like to the point of I'm worried about the future of the country. We I'm sure you've all seen about the like uh tech CEOs and people going do the commencement speeches at the graduations and they anytime they mention the word AI to boo they all get booed and everything. Have y'all are y'all familiar with that?
>> Yeah, I saw that.
>> Yeah. So, there's that. But then yesterday, uh Ronnie Chang, who's he's just a comedian. He's just a comedian.
He was giving a speech for Harvard graduates. I'm not sure why. I mean that that's fine to invite a comedian but so this this comedian went gave a speech to Harvard graduates the US's top school uh my opinion and in his speech he said I'm here to tell you the mission of your generation is to destroy AI to kill it and then they all the whole auditorium is giving him like a standing ovation and like what the [ __ ] happened like could you imagine imagine you go back to like the 60s or 70s or something and like Bill Gate I know the timeline might be off here top computer people are like, "Oh, you know, computers, blah, blah, blah." And people are like, "Boo."
And then like you have comedians giving speeches at Harvard like destroy computers and everybody's like cheering.
That sounds like a dystopian future, but that that's what we're living through.
>> Well, no. It what you're what you're seeing again once again is the result of informationational warfare campaign.
>> Explains people.
>> Yeah.
>> Well, I mean, we've been going over >> pretend somebody knows nothing about the informationational warfare that's watching. Explain this briefly. So just like on a on a on a high level um China has implemented what they call three warfare's doctrine and part of that is informationational warfare using unconventional tactics to gain an edge over your adversary. So we are their perceived adversary. They are our perceived adversary. The way that they can affect change is by manipulation of the populace. And so that's where a lot of this misinformation really originates from and is perpetuated. So they can they can manipulate um algorithms uh through various means some of them including you know for example lots of bots and people can be tricked if they think that for example there's a bias of believing what you think other people believe as as an example and pushing you know different narratives and stories across various social media platforms eventually where more and more people are repeating it and repeating and repeating it where it becomes true it becomes true to a lot of people and then this downstream effects change because people vote And so that's the the strap behind it over there. We can't do it to them because people don't vote, but they can do it to us because people vote here. Um, and so if if they perceive this technology as being very important, they need every advantage they could possibly get. One of them being if I could if I see that you're advancing very quickly, I have to slow that down as much as as much as I can.
And so that's where the um intent and desire comes from is is from just like I need to slow you down so that I can catch up in this race.
>> Um and so when you you talk to people who are anti-I you already know this they're not very intelligent or they're not very well informed.
>> Yeah.
>> Uh on on I I would argue I mean I'm being too mean but they're naive.
>> Well yeah that what's so weird about it to me is even like even let's say these people are idiots. Let's just say they're the stupidest of the stupid. I feel like 10 years ago, if you found a really stupid person, you told them like, "Hey, we made this uh magic robot that'll talk to you and do stuff for you." They'd be, "Oh, wow."
>> That's like that's like, "Yeah, that's cool."
>> We didn't have we didn't have the capability to infect information warfare as we do now. Now is more instantaneous.
Social media and the internet actually has made information warfare campaign much more um impactful. You can see results. So you can see what narratives work and what narratives don't work. So you can switch tactics very dynamically, which is very dangerous. Good for the one who's the attacker, bad for the defender. Um, before way back when, you had only the means of newspapers and TV.
That was the way you would affect information warfare campaigns. So for example, the Soviet Union had to figure out longer term what was working, what was not working, uh, because it took a little bit longer for information to travel. Now it's instant. Now I go on you you go on Reddit, you see something.
You go on your whatever shorts, you see something. Um, and the that immediacy has also made the the speed at which this force acts on the population much more rapid. So I I throw out a bunch of things. I see that this narrative is not working, but this one is. Let's focus on this one and then keep going there. And then something else changes. I put out a bunch of narratives. Okay, this one's working.
Let's go there. It goes viral. You can see virality and you can see effectiveness which makes it that's a doomerism. If you want some dumerism there there's actually some dumerism.
It's uh the brain rotting is real doomeris. I >> I'm doomeristic on brain rotting.
>> Yeah.
>> 100%.
that that if you want actual dumerism because there really is no real answer to it because the only answer to it that no one is actually suggesting no that shouldn't be the solution is to restrict speech for example >> but no one no one wants that outside of that >> my idea was just self-imposed like uh you just spend a day without your phone spend a day without your crazy brain literally it's like you overclock your brain I know, but be realistic about the population. So, what is a realistic solution?
>> The I mean the the only the big solution is getting rid of voting.
>> Well, >> because like the that that that really would be the solution because people people are cooked. Like AI is going to get more and more sophisticated. It's going to be able to target you and because it knows all your information.
It could go through all your private messages. All that data is out there.
they can specifically target you based on all the data they have to sway your opinion whatever way they want to. So the realistic solution is to get rid of voting.
>> That would solve problem. Positive idea here um is >> uh we just get good defensive AI. So like let's say Twitter, Reddit, they have an AI that just oh this person is and obviously this could go dystopian very quickly but is like oh this person is clearly a foreign bot. So they're banned from the platform now. Yeah, that that could be that could be a solution. But obviously then you're just gonna have, you know, like kind of like when you know all the conservatives are saying like, "Oh, we're getting kicked off of we're being deplatformed and stuff."
>> Um you could have stuff like that where you just target opposition that is legitimate. You know, >> you will you will have very quickly narratives formed that you're creating censorship.
>> Yeah.
>> Bots. And so that's why it's hard. Some some folks in uh presently um some folks actually suggesting Yeah, it keeps coming.
>> We're still closing out in a couple minutes. American schools are political marketing lights, similar to commie schools. Individuals like yourself are literate and creative and will teach.
>> Well, thank you. I don't know who you're talking to. You You must be talking to me. We want to give a shout out to Major General Tao. Thank you.
>> He's been dropping money today, man.
Email me if you want a sponsored video for free, >> right?
>> Yeah. If you want a free sponsored video, donate $50 right now and you will get a free sponsored video.
>> Yeah, you got about a minute and a half.
>> Yeah.
>> I I haven't ate today. Well, I had a handful of uh trail mix and that was it.
I haven't either.
>> I'm starving.
So the rapid like optimistic thing on on AI is that AI is not actually going to be you know the enemy of everyone. It's it's much more likely to be um a productivity driver than anything. I mean we're seeing this like for example programming jobs at one point everyone was calling to end the programming jobs and then something changed in November of last year but only people who don't read uh and they're still dumerish posting on it on X still espouse this but um hiring on engineering jobs has actually gone up or programming jobs have gone up uh because it turns out it's like a calculator so if I give you a calculator and you're a mathematician you've actually just become a much more productive mathematician um and So, I want more of you, but or more companies, different companies want them, and I don't need like a hundred of them in my company, but I can do the same job with with less of them. So, I have two options. I can either just do more with the same amount to cut it and do the same with less. And if I'm a company that didn't have before and I was like, I'm not I don't have the budget to hire 100, but I have the budget to hire 20, but 20 can't really do much. Well, now 20 can. So, >> I I want to have this on record so it's saved. Um, and this is going to piss me off for the rest of my life. I'm literally going to I'm going to be 90 years old complaining to people. This is this is really going to piss me off so much. The people right now who are like I'm like, "Oh, AI is going to be amazing." And they're like, "You're an idiot. You're a dumbass. AI is going to end the world. It's terrible." Uh, and it's a bubble, blah, blah, blah. In 10 years, in 10 years, those exact people are going to be like, "Well, I always knew it was going to be helpful." I be like, "No, you [ __ ] didn't." But >> well, they'll just gaslight you and pretend they never said it.
>> Yeah. Just just write everyone's names down who's a [ __ ] And then when they're in the future, that's what I do.
>> That doesn't it doesn't matter, though.
Even if they make a thousand mistakes and they're wrong about everything, they can just say, "Oh, no. I never said that."
>> Yeah.
>> And even if you show video evidence, they be like, "Okay."
>> Yeah.
>> True.
>> There's no consequences.
>> True.
>> You'll be wrong infinitely. It doesn't matter.
>> We did this hours. Yep.
>> Thank you guys for tuning in. Thank you for all the generous super chats. I think I hit my goal this month. Oh, baby.
Maybe I should quit tax. What do you guys think? Anyway, like, subscribe, join as a member, give me all your money. Thank you guys for tuning in and I will see y'all later. Cheese.
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