In their latest episode of the VALUE: After Hours Podcast, Bill Brewster, Jake Taylor, and Tobias Carlisle discuss:
- Joel Greenblatt’s Value Returns and Metrics
- Hedge Fund Concentration In The Magnificent Seven
- Long-Term Optimism Amid Short-Term Uncertainty
- Charles Darwin & The Concept of “Darwin Facts”
- Market Speculation: Betting On All-Time Highs
- Why Farmers Are Extremely Savvy When It Comes To Commodity Prices
- Exploring Financial Curiosities and Fiscal Years
- Analyzing Disney’s Business Prospects and Media Industry Challenges
- Recent Market Trends and Cathie Wood’s Success
- Comfort Levels And Travel Preferences
- Geographic Differences in Dopamine Receptors and Novelty Seeking
- Inflation and Economic Realities
- Cardboard Usage And Morgan Housel’s Publishing Journey
You can find out more about the VALUE: After Hours Podcast here – VALUE: After Hours Podcast. You can also listen to the podcast on your favorite podcast platforms here:
Jake: Never going to get to the bottom of this.
Tobias: We are being live streamed now. We’ve figured it out.
Bill: We’re live-ish.
Tobias: I’m Tobias Carlisle, joined by Jake Taylor and Bill Brewster. We got the band back together. What’s happening, fellas?
Bill: What up, Munger? I’m back.
Jake: I’m wrong. Burgundy?[laughter]
Tobias: Ah, what a classic. Have to go back and watch it again.
Jake: Good to have Billy back in the house.
Bill: Nice to be here, gentlemen. Apologies for the state of my office. We are almost in transit. So, there’s that.
Tobias: I didn’t notice anything different. [crosstalk] little bit od chaos.
Jake: [crosstalk] cleaner than normal. What’s going on?
Bill: Noted. Noted. Tell you what, recently, got prescribed Concerta-
Tobias: What’s that?
Bill: -which is an ADHD medication. I think I’ve been a one-legged man in an ass kicking contest for a while. So, we’ll see how it goes. I’m sure I will get used to it and it will taper off here. But for now, I feel like Superman.
Tobias: I hear from a lot of old lawyer friends of mine that there’s a lot of ADHD medication that might be used off label in order to get documents out, get things done, work late.
Bill: It doesn’t shock me. Back in college, I may have done similar things though that was with Adderall. This is a little different. Anyway, I digress.
Tobias: I think that’s been going on for a while.
Bill: Long story short, my office has been more organized recently. Fair criticism [unintelligible [00:01:30].
Tobias: You need to get a screen like this. Just block the carnage behind. Block the chaos.
Bill: Yeah, that’s probably right.
Tobias: Let me give a shoutout to– What have we got? London, first in the house. Stirling, Scotland, what’s up? Brandon. Sugar Land, Texas. Minneapolis. Oaxaca?
Bill: Oaxaca. Where the heck is Oaxaca?
Tobias: “Hola a todos de Oaxaca?” Everybody in Oaxaca?
Bill: Dude, shoutout to them.
Tobias: Bakken Oilfield, Saskatchewan.
Bill: Sas, what’s up?
Tobias: Savonlinna, Finland. Gulf of Mexico, how you doing? Boise. Kennesaw.
Bill: Gulf of Mexico, how are you doing, by the way?
Tobias: Yeah, let’s get some updates on the– [crosstalk]
Bill: Hope you’re okay.
Tobias: Glasgow. Toronto. Helsinki. This is great spread. San Fran. Arlington. Tallahassee, South Dakota. Toronto. Kuopio, Finland. Finnish?
Bill: You’re just making places up at this point. Come on.
Tobias: I feel like it. Well, I’m not the one making them up, but Finland, Finland is representing strong. Australia, wake up early, 03:30 AM there. Let’s get going. Mexico. Singapore. Mexico City. Liverpool. Mexico is doing well.
Bill: And this is the podcast, folks.
Tobias: We just read them all out? That’s it.
Bill: Yeah. Ian Cassel out here, just typing away at different places.
Tobias: What’s news, Billy? Have you paid attention to the markets at all for the last summer? Does anybody pay attention to the markets over summer?
Bill: I paid attention to the businesses that I own.
Tobias: Yeah, you’re a real investor.
Jake: That’s your problem.
Greenblatt’s 70:30 Asset Allocation
Bill: Right. I don’t know, man. My target allocation, generally speaking– Greenblatt shared this on a podcast, and I thought, he’s smart and this is smart. So, I’ve lived my life by this. If I’m misattributing it, I think it’s smart, and it’s nice to misattribute it to him. Anyway, he said like, “Pick an asset allocation.” If you think the thing– So, I pick 70:30 because that makes some sense to me and then there’s some alternatives in there. But I basically said, “If you think things are roughly in line with where they could be, don’t deviate. If you think things are screamingly cheap, go to 60:40 or 80:20. And if you think things are screamingly rich, go to 60:40.” I’m at 70:30 right now. Not terribly comfortably, but that’s where I’m at.
Tobias: So, you’re at 70:30? So, that’s your default setting?
Bill: Yeah. And I obviously have endowment bias for everything that I own, so I think it’s cheaper than the market and I’m going to get crushed.
Jake: I hate the market, but I love my names.
Bill: That’s right. Yeah. My names are not correlated. Yours may be, but I am a picker.
Tobias: I think Graham used to say along a similar line, but I think he said 75:25 and you should never go below 25 equities and never go above 75 equities. That’s what– [crosstalk]
Bill: The other thing is, I got cash coming in. We’ve talked about this in the past, but I look at it like, I just don’t see assets right now as, “Boy, I am going to make a ton of money just like taking risk.” And plus, freaking short-term yields are 5.5%. You can lock in reasonably decent long-term yields. I’m not willing to take tons of duration, but I’m not in some big hurry to go out and buy equities here. [crosstalk] And if it works, it’ll work and I’ll be fine. What’s up?
Jake: How far out are you willing to go right now? Two year?
Bill: I don’t know. For the right credit, I’d probably go to five years. I think Charter– I mean, obviously people can debate whether or not they like it, but a name like that, I think you could take some duration on that.
Tobias: In the debt.
Bill: Yeah. I don’t know though. I’m not certain where credit spreads are. But it would not shock me if that’s a reasonably decent alternative right now. But I wouldn’t go outside of that.
Tobias: Where are you JT? You got a new background there.
Jake: Yeah. I’m in London at the moment.
Tobias: London, England.
Jake: An office with some ships on the walls. So, that’s– [crosstalk]
Tobias: Florida, California, and London, this is such an international, such a global podcast.
Bill: One of these places has done well with COVID.
Bill: [crosstalk] At least according to a professor in Stanford, but what does he know?
Tobias: Stanford professor said, Florida, not California.
Bill: That’s what he said. [crosstalk] Probably not. Probably not. I heard you guys get canceled last week for these free market talks also.
Bill: So, it’s nice to see you all are continuing the tradition that we started.
Jake: I’ll wear that one.
Tobias: We survive because that Austrian– For one thing, criticism of the Fed, you’ve narrowed it down to a tiny little percentage of people who know or care.
Jake: Yeah. And no one’s listening to this anyway, so you can’t get canceled.
Tobias: I’m relying on it.
Bill: Yeah. Well, I don’t know. I bet the overlap of Fed critics and our listeners– well, your listeners is quite good.
Tobias: Yeah, that’s right. Everybody comes here for the Fed criticism.
Bill: That’s right, and the perfect macro takes also.
Jake: Yeah. Stays for the 10:3 inversion.
Bill: That’s right. Buckle up, folks. There’ll be more.
Tobias: 1.38 today. It looks like it’s been creeping up. It’ll get there eventually.
Jake: Oh, boy.
Tobias: I was not going to mention it, but since you brought it up, 1.38. It’s a long way from closing, but it’s– [crosstalk] .
Jake: I’m surprised we made it eight minutes into the show before.
Tobias: I was like that– [crosstalk]
Bill: When you wake up, you know how we have the deck clock in the US? Do you have that in your bedroom, like a ticker?
Tobias: It’s one of the things I check. I check it every day. Not necessarily because I think it’s going to work, just because I’m interested to see whether it will or not.
Tobias: The track record is the track record.
Jake: When you are a kid in Australia, did you ever think that, “Boy, someday, when I’m an adult, I can’t wait to just wake up every day, check the inversion?” [laughs]
Tobias: Check the 10:3 inversion.
Bill: Dude, he was out there on the farm and whatnot. And every day, he just couldn’t wait till 10:00 AM or 03:00 PM. There was just always something about 10:3.
Jake: He’s down there in British-Texas. [laughs]
Bill: British Texas, indeed. Wrangling and wrestling.
Why Farmers Are Extremely Savvy When It Comes To Commodity Prices
Tobias: Here’s the thing that people don’t realize that farmers are incredibly sophisticated about commodity prices and those sorts of things, because they have to, because that’s their business. They know the price of all of the inputs and their outputs, all that sort of stuff. They know that stuff. I used to go to these, it’s like a conference, except it’s outdoors. There’s all of the farm equipment and stuff lying around. There are people pitching like, how their software can help you increase yield management, the laser lever your land, and all that sort of stuff. I think American country and Australian country are much closer together than American city and American country and Australian city and Australian country, because they’re dealing with the same thing, like, they’re speaking the same language.
Bill: Hold up, hold up, wait. Australian country, American country, same. American city, Australian city same.
Tobias: But probably closer. I would say the cities are closer psychographically than the country area. So, the country areas are closer to each other than the city. Sorry.
Bill: Oh, okay, we’re talking geography.
Tobias: The location.
Bill: Got it.
Tobias: So, if you’re in the country, you’re more to talk about with a country person from a different country than you are for a city person in your own country. I know that was complicated, but– [crosstalk]
Bill: No, that makes sense. I get it.
Tobias: They all know the commodity price. They all know all that stuff. Their computer screens look like ticker feeds of commodity prices. They know the interest rates, they know the currencies, they know the commodities.
Jake: Are they upside down though? That’s what I’ve always wondered.[laughter]
Tobias: Honestly, I was too young. I had no idea what was going on. So, it’s very complicated. “The rural.” That would better. Thanks, Johnny.
Bill: Yeah, we knew. Johnny did.
Tobias: A lot of friends got picked up out of, like, they went to an agricultural college and they got picked up by a London investment bank to trade in a [crosstalk] Yeah, because they knew those markets really well. If I’d have been smart, that’s what I’ve been doing. Then I wouldn’t be running this podcast, I’d be retired somewhere or blown up.
Bill: Yeah, I would blow up if I was a trader, that I’m certain of.
Tobias: A lot of people blow up.
Bill: Yeah. Well, so, when I was going through this diagnosis that got me this Concerta, we’re going through my personality and my brain and whatnot, and she was like, “You should probably be mindful of the amount of risk that you take, because you’re genetically predisposed to be risk seeking.” And I said, “Well, that’s very interesting because I’ve dialed back concentration quite a bit and I sleep a lot better at night.”
Jake: 23andMe of you for that or she just made–? [crosstalk]
Tobias: Yeah. How did she do that?
Bill: We got pretty forensic on family history and stuff like that. So, I guess, it was through my own lens. It’s possible. I either articulated my family history wrong or she said it– Maybe she interpreted it incorrectly. But either way, she confirmed my bias. So, I like what she had to say.
Geographic Differences in Dopamine Receptors and Novelty Seeking
Jake: Well, there is a dopamine receptor difference between people. You’re just slightly more susceptible to being dopamine seeking. Like, it just feels that much better. It’s the R four-allele that is like this. This is so fascinating. So, picture a globe, right? When you look at this certain R four receptor, it has a higher prevalence as you move down through North America, and it keeps getting more and more concentrated as you get down to South America. So, it was basically like novelty seeking people just kept going further and further south after crossing the [unintelligible [00:11:55] land bridge. And now down in South America, there’s this really high concentration of the R4 allele that has a novelty-seeking bias to it.
Tobias: Does that work east to west across the US?
Jake: You see the same thing down Malaysia and down on that side of the planet.
Bill: And novelty seeking would maybe be associated with risk seeking, you think?
Bill: Interesting. So, we should be advertising online gambling down south, further south we can.
Bill: That’s the capitalist take on that. That’s interesting.
Tobias: Where are you all–? [crosstalk] As little as possible or is there some optimized point that’s halfway down? I don’t know.
Jake: Stop in Mexico and you’re ready to–
Bill: No, I don’t know about that. These are just proclivities, like, how it gets expressed is your epigenetics. The environment will change what gets turned on and off. So, this stuff is not really destiny per se. So, I wouldn’t get overly prescriptive about it, but it is super fascinating that genetics led to geographic population difference.
Tobias: Makes sense.
Bill: I think Buffett has said that, “You can’t really learn investing” or whatever. It’s more like an endowed trait or whatever. I’m not totally saying that right, but I think he’s saying like, your personality type. Obviously, this is self-serving to say this, but I think it’s a much more important thing to know your weaknesses and then structure around those, as opposed to just being like, “Oh, well–” Think about a world where you just say, “Well, I’m not born for investing, so I’m going to give it to some fucking guy at Raymond James.” That guy’s a ChoCh.
Tobias: Hey, Raymond James– [crosstalk]
Jake: Criticized by category.[laughter]
Bill: I’m just saying. I like a lot of them. They’re nice guys, but they’re sales people, right? I’m trying to figure out life here. So, anyway, no offense to the good people at Raymond James, but it’s an interesting– It’s all a learning thing. A lot of the people that I’ve seen that have made very big mistakes, I think, are people that haven’t maybe acknowledged who they actually are, and they live in some form of denial about it. I think it costs them a lot.
Jake: Yeah… good advice in the investment world, especially because I think the stress of markets will eventually reveal where the cracks are, eventually.
Tobias: Yeah, that’s right. Nothing like the markets to reveal whatever psychopathology you got lurking in there.
Jake: Yeah. [laughs]
Bill: So, I’m 100% an upstart, and it’s this great company that’s coming. No, I’m kidding.
Jake: What do they do there?
Bill: It doesn’t matter. It’s a nice chart. Well, it was a nice chart and then it got cut in half, so I immediately borrowed on margin because that’s how it works. I kid.
Recent Market Trends and Cathie Wood’s Success
Tobias: All that stuff’s back, I checked the Morningstar style boxes for the last 12 months, and it’s been a big growth 12 months. And as you go less big or less growth, you’ve done slightly worse. I was surprised. It’s quite a bounce back. The bottom was October last year, so I guess we’re coming up on that, which is probably why.
Jake: Where do we go from here?
Tobias: You’re asking the wrong guy. I’ll tell you what I think and then you can just fade me, and that’s probably- [crosstalk]
Tobias: -just Costanza me. Yeah.
Jake: Yeah, [laughs]
Bill: What inning-
Jake: Yeah, what inning?
Bill: Of the rebubble?
Tobias: I just did this. I was looking at Ark, the A-R-K-K-A-U-M over the last– Just since inception, just to see what it had done. It’s hard to tease anything out, but I looked at year on year, and it’s crazy when you look at Ark on a year-on-year basis. There’s this massive AUM gains through to March 2021. So, March 2018 was the first run up, then March 2021. I sent it through to JT yesterday, just jokingly, saying, “Hey, that means three years. The next one is March 2024 coming.”
Jake: Yeah. [unintelligible [00:16:22] for a big–
Tobias: It’s that tsunami. That meme with the dude turning around like, here it comes.
Bill: Wait, what do you think is 2024?
Tobias: Oh, just the three-year.
Jake: Just saying, there was three-year gap.
Tobias: I’m totally joking.
Jake: This will be another three-year gap. The locusts are due to come out of the ground–
Bill: Every three years.
Tobias: March seems to be when they come out.
Bill: Well, shoutout to her for outlasting George Noble.
Tobias: Wow, that was short lived.
Bill: It was short lived.
Jake: [unintelligible [00:16:51]
Bill: No, not that guy. Not that guy, No way. You put yourself out there like that, and you take retail money, and you blow it up, I will criticize by specificity. Same way I go at a Chamath or whatever the hell his name is. I apologize to everyone I offend when I consistently mispronounce it, but I will refer to him as skinny legs from now on, and that’s something we can all understand or ChoChmath.
Tobias: Cathie’s done well. Cathie survived that whole thing. She had the big run, had the second big run. Seems to have had a third pretty big run here. [crosstalk]
Bill: I think she’s probably made life-changing money for herself through this.
Jake: We can throw stones, but I’m sure if we compared bank accounts, she’s outdoing all three of us put together.
Bill: Facts on facts on that.
Jake: That’s how you want to play the game.
Bill: An unfortunate reality you bring up, Jake.
Jake: [laughs] Sorry. My apologies.
Bill: It’s okay.
Long-Term Optimism Amid Short-Term Uncertainty
Tobias: I like it too much. I don’t want to blow up. I just want to keep on going. I want to survive. That’s my primary setting, which is why I tend to be short-term bearish, long-term bullish. I think that’s the best way to do it. I’m nervous in the short run, but long-term, very, very optimistic. I think got good– [crosstalk]
Bill: Dude, you see where assets are trading right now? It’s hard to be like Uber bowled up.
Tobias: I just mean long-term. Long-term– [crosstalk]
Bill: No, I understand. I get it.
Tobias: Long-term is not a call on the level of the market. Long-term is a call on the underlying civilization’s ability to generate technology and quality of life for people into the future. I think it’s very good. The pricing of it in the short-term is always a little concerning for me. I’d rather get a bit of a discount for the birds that I don’t have in the hand I want a bit of a discount.
Bill: Yeah. I might start to flex towards long-term mediocrity as a base case. I don’t know. I don’t disagree. I’m not just talking about equity markets. I’m talking about assets generally. Although my dad watches cars, and apparently, the middle of that market that was strong has really started to fall off and the high-end stuff is still hanging in there, but that’s about what you’d expect I think towards the beginning of the end of one of those cycles.
Tobias: The hardest thing to tease out is that COVID has just ruined all of the chart– It’s not just the price charts. It’s the underlying fundamentals and all of these things too. So, you can’t look at anything like– You got to get what, pre 2019 now for normalization– [crosstalk]
Bill: Four-year stacks, baby. It’s awesome. The four-year stack.
Tobias: What’s that?
Bill: When you’re referring back to 2019. There was a two-year stack and then the three-year stack, and then it’s like, “Well, we’ll go back to 2019. It’s a four-year stack.”
Tobias: Ah, yeah.
Bill: I can’t wait till we have a 10-year stack. It’s going to be amazing.
Bill: You’re not wrong.
Tobias: Well, 2008 was such anomaly that you can’t use it.
Jake: [crosstalk] for that.
Tobias: Yeah. There’s always going to be anomaly. But I do think that that COVID is a real anomaly in that data. Like, the lumber prices, which we followed for a while– [crosstalk]
Bill: Still quite a bit higher. I would not call Mike, wrong.
Tobias: Oh, I’m not– [crosstalk]
Bill: No, I’m not saying that you are. I’m just saying, you think about what– So, what lumber goes into as an end market is basically directly what the Fed has been attacking as a way to slow down everything. And right now, if you look at the September lumber futures, they’re north of 500 per thousand board feet. 500 per thousand board feet four years ago was like a high price. This is like the end market is basically stopped and it’s there. So, we shall all find out.
Tobias: Jake might have said it a few times. Maybe even Meb Faber said it as well. If someone 12 months ago or 2 years ago gave you the current interest rates and then asked you to guess where the market is, there’s just no way you’d guess it is where it is. You’d say rate stuff market down.
Bill: Especially since you and I did this in the beginning of the year, and Jake reminded us, and we were wildly off.
Jake: [laughs] Oh, man. That was embarrassing.
Bill: I think it only has to go down 20% for me to be right. Buckle up.
Tobias: I think that the biggest tell on me is that none of those are internally consistent. Like, there’s just no way that–
Jake: I thought you were hedging your bets by making them nonsensical. [laughs]
Tobias: That’s what I’m going to claim.
Bill: That’s right.
Tobias: I had the hedge, the portfolio hedge.
Bill: Makes perfect sense to me.
Joel Greenblatt’s Value Returns and Metrics
Tobias: Greenblatt publishes on his Gotham website, the two-year look ahead returns for his portfolios, which is an earnings yield built on Ebit/EV, which I like, because I like that metric. It’s now trading below the 50th percentile. It’s high 40s. 48, 47, something like that, which means that we’re in the more expensive part of the half, like, still pretty much at the midway point. I have a little bit of trouble getting my head around that, given that for years and years, it’s been the other way around.
Jake: How does it feel for you when you look at your screens and you compare it to historical screens? What’s the general cheapness today of what you do–?
Tobias: I don’t track just the yield, although I probably should track that. I’m just less interested in the yield by itself as a number, because I look at rate of reinvestment and what the historical return, the amount that is being reinvested and the historical return on that reinvestment and the amount that’s available. Those numbers are definitely down as you’d expect. October last year was pretty good, and now it’s a few percent lower. I don’t want to make these sound like these are forecasts, because they’re not.
Jake: Yeah… you’re going to put up this number.
Bill: No one in the investment industry would ever say anything like someone would compound 40% from here.[laughter]
Tobias: Well, I thought the number was pushing 20 in October, and I would say it’s closer to 13.5, 14 now. It’s just the one that I look at. So, it’s pretty– [crosstalk]
Bill: Where do you see–? [crosstalk]
Jake: Thos are the prices running up either. [laughs]
Tobias: Well, they have run up quite a lot from October. Like, from the October– [crosstalk]
Jake: Oh, okay, fair enough.
Tobias: Yeah, I agree. I look at the Greenblatt stuff and I’m like, “How is that number coming in so much?” Because it’s not like there’s that much performance there.
Bill: He’s long a bunch of cyclicals.
Jake: [crosstalk] talked about it at one point. It was way up there.
Bill: Yeah, but he was long a bunch of cyclicals and the earnings rolled over and the price probably went up a little.
Tobias: If you think about it, the criticism at that point when we were looking at it was, well, it’s heavy energy.
Tobias: I don’t know that energies come in that much. I would say energy- [crosstalk]
Bill: Oh, for sure, dude.
Tobias: [crosstalk] -through that period of time.
Bill: No, I think you’re coming. Well, I say, for sure. I don’t know what I’m talking about. If I recall correctly, last quarter energy earnings were supposed to be down 47% year over year.
Tobias: Okay. Year over year, really?
Bill: Yeah. They freaking printed money, what, two years ago? Well, not– What? 12–
Bill: The calendar year of 2022, they destroyed it. And they may again, but I bet if they do again, I bet you’ll see the multiple [unintelligible [00:24:58] a little bit. Yeah. I’m just looking right now. Top ten GBLU. Sorry Jake.
Jake: Well, I was just going to say, Chevron’s down like 7% year to date. Exxon is at roughly flat. Oxy is roughly flat.
Tobias: Is that earnings or stock price?
Jake: This is just stock price.
Bill: As top ten GBLU, you got Cal-Maine. That’s an egg producer. Eggs went through the roof. Mueller Industries, Imperial Oil, Marathon Petroleum, TEGNA, Builders FirstSource, Valero CF and Philips 66, it’s a lot of cyclicals.
Tobias: What’s GBLU is that? Is that the Gotham–?
Bill: Yeah, I think it’s his thousand–
Bill: Yeah, the thousand value.
Tobias: Because he’s got a few funds in there that are like half SPY equivalent half. It’s not that.
Jake: Right. They’re replaying of the SPY basically, like, if you need to hug an index but you want a little bit of a value tilt, that does.
Tobias: Yeah, which seems to me it solves tracking error for him more than it solves any real investment problem for anybody out there.
Bill: I actually think solving tracking error. It takes a lot to have substantially different returns from the people around you. That is not the easiest thing. Even if you think you can– [crosstalk]
Bill: Yeah, same-same. Same-same. But yeah, no, I don’t know how many people are built for too much tracking error.
Tobias: None of us are really– We just hope reigns supreme.
Bill: It’s like, when you’re signing up for an investment product, you’re like, “Yeah, I’m good with tracking error.” And then you live through it for three or four years and you’re like, “Man, that sucks.”
Tobias: It’s a long.
Bill: I think that’s wild.
Jake: McConaughey meme from True Detective or– [laughs]
Tobias: The start and the finish. Yeah, that’s right.[laughter]
Hedge Fund Concentration In The Magnificent Seven
Tobias: I saw hedge fund concentration in the Magnificent Seven. It’s like all time highest as you’d expect maybe, but that could just be buying and holding, could it? What do you think people are chasing that?
Bill: I don’t know.
Jake: [unintelligible [00:27:26] had a pretty good article about that maybe two weeks ago or so. You can feel free to disagree with this if you want, but he was saying that really the only question that matters right now for any kind of allocator and fund is how much of the Magnificence Seven do you want to have exposure to today. You can choose to pick a lot of it and then keep up maybe with everyone else or maybe keep down with everyone else, I don’t know what the answer to that is. Or, do you want to go different from that and you’re going to then look different for better or worse.
Bill: Yeah. I think the answer is you want to keep up or keep down with everybody else if you like your job, which is an unfortunate answer, but that’s how I think the world works.
Tobias: It’s the same problem that we’ve had for the last few years that really they are. Like, they’re spectacular businesses too. There are solid, fundamental reasons for owning them at the same time as there are other not fundamental reasons for owning them. You could make a pretty good argument that it’s a pretty good portfolio. That’s Google and Microsoft, and Amazon, Meta, and whatever else is in there. Netflix, whatever.
Bill: Yeah. Tight entry fee, cash flow yields especially. But they’re growing and they got good returns.
Tobias: Yeah, that’s right.
Bill: It can work.
Tobias: They’re reasonably certain cash flows though I would have thought.
Tobias: Don’t see Microsoft getting headed for its– Google’s not going to get headed. Long enough period of time, everything’s vulnerable, but next short period of time, none of them– [crosstalk]
Bill: I read in the Wall Street Journal, and I do not like this idea. But I read that 10 cents at 17 times earnings and Alibaba is at 10. I’m not sure that I still think that that’s an investment, necessarily, but it could be an intelligent speculation.
Tobias: Yeah, that’s it. I think that too. They probably are going to work out over a long period of time, unless we get into a cold war, hot war. They decide to chop the [crosstalk]
Bill: I think that’s reasonably choppable.
Tobias: Everybody’s a fundamental investor, and then you just run into that’s some real macro, geopolitical macro risk.
Bill: Yeah. But that’s why they trade where they trade. So, is it priced in? We had this with Russia.
Bill: It wasn’t until it wasn’t. I think media is a little bit interesting here as a sector. I hear TSOH is coming on next week. You should talk to him about that. He’s got some thoughts.
Tobias: Yeah. TSOH. Had to process that a little bit. Science. Yeah, Alex Morris is coming.
Tobias: Is he TSOH now?
Bill: That’s just what I call him for short. TSOH, The Science of Hitting. I call him TSOH. Yeah, man. I don’t know, we’re at an interesting point. I’ve been negative for a very long time, but now everybody’s starting to push price and start to find out what stuff’s worth. And then I don’t know, I think this strike in the one hand sucks. But boy, if you wanted to have a capital cycle theory and some sort of catalyst to rein in spending somehow, having a strike is a pretty good excuse to really look at the budgets going forward.
Analyzing Disney’s Business Prospects and Media Industry Challenges
Tobias: What about Disney getting punished the way it has been? Disney’s, now zero total return for 10 years or zero index return for zero price return for 10 years? It’s a beast business. It’s just they’ve stepped on about four landmines as they’ve released the last four movies.
Bill: Yeah, I don’t know that it’s the movies as much as you’ve got. The investment of the media business is very uncertain right now, and I think you’ve got to trust that they’re going to be able to monetize– Look, I think Marvel’s heyday is past it for the foreseeable future. Guardians is a fantastic– [crosstalk]
Tobias: They build that one pretty hard.
Bill: Yeah. Dude, you’re not going to recreate–
Tobias: Star Wars, [unintelligible [00:31:38] that pretty hard.
Bill: Yeah. But Star Wars is turning. Have you watched Andor?
Tobias: I watched the first episode. I don’t give a shit anymore. [laughs]
Bill: Well, that’s fine and that’s fair. I think that there’s a legitimate question to be asked whether or not like media just returning all these franchises gets boring in people’s minds. I think that could happen.
Tobias: I’m bored. I’m tired of it.
Bill: Yeah, I think that’s fair.
Tobias: I may not be the consumer. They might be aiming for seven-year-old kids. That’s why I think– [crosstalk]
Bill: And I have the mind of a seven-year-old? Maybe I’m Am I wrong?
Tobias: Andor is probably too–
Bill: Got something else of a seven-year-old. Anyway.
Tobias: Too grown up for them.
Bill: Andor was fantastic. And so, The Mandalorian is pretty good, man. If you start getting those spinoff shows that are not gimmicky spin offs, it really unlocks a lot of possibilities for you. I think Star Wars, they may be fixing. Guardians was excellent. I’m such a Homer. I liked Ant Man. But I was on a plane, so you got to forgive that.
Tobias: What does that make you? A home?
Bill: Well, Ant Man, a lot of people didn’t like it, but I liked it for what Ant Man’s supposed to be. Anyway, I don’t know, I think the future is a little uncertain, but the Parks business is incredible. I think ESPN is a little bit like milk in that you have to have it. I think to protect the bundle, and I think there’s a chance that they’re going to be able to monetize that in the future. You should ask Alex what the parallels between Disney now and Walmart 10 years ago are and let him riff on that. That’d be a good question.
Tobias: You remember that one, JT?
Jake: Yeah. [laughs]
Bill: I’ll write you, guys.
Jake: Got it.
Tobias: To me, Disney, it has the potential to be one of the best businesses out there, because– I think Buffett said it when it’s an oil world that never runs out, just this perpetual royalty machine. All you got to do is hook a seven-year-old with a princess or whatever the case may be, and then you got a generation. And instead, they’ve produced these four movies where there’s no discernible princess for– So, my daughter has passed through that period and doesn’t have a Disney princess.
Bill: She doesn’t like Elsa?
Tobias: She was just a fraction young for Elsa.
Bill: Show her now. Elsa’s the shit.
Tobias: I’m not trying to get her hooked, mate.
Bill: Dude, I used to be on the plane with Frozen in my ear. That’s a good movie.
Tobias: Which one?
Bill: Frozen. Frozen II. Frozen is legit. Anyway, I think Buffett, when he talks about Paramount, he talks about what a bad business streaming is and then he finishes with we’ll see what happens. I think the language between we’ll see what happens is, I have seen many phases of bundling and unbundling. I’ve seen media come and go. There’s usually a time that they figure it out. I think the capital cycle theory– I think he was early, which is what he would say his general error is if he makes one is maybe to be a little early. But I think the bet on Paramount is a bet on ultimate rationality, and I think we are way closer to rationality than we have been for the last 24 months.
Tobias: You want to own the pipes or do you want to own–? If I had a choice between Disney’s current bundle and the Harry Potter universe, Harry Potter, she’s got however many movies, all of the books now, the spinoffs with– It’s another wizarding world. They’ve got a giant shooter game out there, and they’ve got that other– [crosstalk]
Bill: Zaslav will make sure, you know, they got the game. He loves to talk about that. Harry Potter’s legit. I got love for Harry Potter. The thing about Warner Brothers that I still don’t love is you’re very tied to the bundle and your sports rights are NBA. I don’t know.
Tobias: How much of the IP do they own and how much is owned by J. K. Rowling? J. K. Rowling still got it all, hasn’t she? She’s got– [crosstalk]
Bill: Well, I don’t think so. I would need to look it up. But I think Warner Brothers has a substantial majority, if not all the rights. She may have the rights to some other stuff, but I think it’s a Warner Brothers property. I could be wrong. Yeah. Do your own due diligence, folks.
Tobias: JT, do you have Veggies or have you–?
Jake: I do.
Jake: Because you’re traveling on a– [crosstalk]
Jake: You know what? Always got delivering– [crosstalk]
Tobias: [crosstalk] the mailman. The mailman’s here.
Jake: Oh, by the way, tomorrow will be the 93rd birthday for our favorite Nebraskan, Mr. Warren Buffett. So, everyone-[crosstalk]
Tobias: That’s a knock.
Jake: [crosstalk] -tomorrow on his birthday.
Bill: Hang on one second. J. K. Rowling retains all the rights to IP, while Warner Brothers Entertainment owns all the production rights to the films.
Bill: That is according to the Google machine. If you don’t like it, take it up with Google.
Jake: All right.
Bill: All right. Sorry. I’m back.
Bill: No such thing. I learned that last week.
Jake: Yeah. [chuckles] I’m still skeptical on that.
Jake: Yeah. I think it’s semantics is what’s happening.
Bill: It’s fair.
Charles Darwin & The Concept of “Darwin Facts”
Jake: So, I’m not that far from Westminster Abbey at the moment, which happens to be the burial place of Charles Darwin, among other things. So, we’re doing a Charles Darwin inspired veggie segment this week. Of course, everybody knows his contribution of theory of evolution, 1837, along with Alfred Russel Wallace. They published close together. And also, everyone knows the story of him going on a voyage to the Galápagos on the end on– [crosstalk]
Tobias: On the Beagle.
Jake: Yeah, the Beagle. Seeing these different finches with their specialized beaks for getting different types of food adapted to their environment. But Darwin also had some other intellectual contributions that we might find useful. I’m not referring to the pros and cons of marriage, which is one of the things that he wrote about in his journal that they published.
Tobias: Was he for it or against it? Where did he fold–? [crosstalk]
Jake: Oh, it’s a little bit interesting. I’ll give you some of the pros he had. Companionship in old age [crosstalk] “better than a dog anyhow.”
Tobias: Lives longer.
Jake: Number two, children. And then the charms of music and female chitchat. That was another thing in the pro column. On the con side, it would limit his means and he’d feel a duty to work more. It would pinch his freedom and his travel, not having to have to go visit relatives, which he didn’t enjoy. And also, it would keep him from buying as many books as he wanted, and then also fatness and idleness. [laughs]
Bill: I’ll tell you what, man. I would disagree with him almost on each side of that list. Almost everything he said. Not everything, but a lot of it. I prefer her family to my own, but I digress.
Jake: Well, maybe Darwin wasn’t well.
Tobias: More family. [unintelligible [00:39:06]
Jake: Well, here’s the amazing thing that he was visiting his family and her family because they were first cousins.
Bill: That’s a bit tight.
Jake: It was a little bit different time that– [crosstalk]
Tobias: The dude who was into genetics married his first cousin?
Tobias: The evolution of the species.
Bill: That is interesting.
Jake: All right, so let’s get this back on the line.
Bill: This is why I’m long-term long idiocracy, by the way.
Tobias: Yeah, it’s inevitable.
Jake: Perhaps, his most powerful and maybe least known and insightful contribution had nothing to do with marriage or evolution. Whenever Darwin was faced with an alternative hypothesis to his beliefs, with some new information that jarred with what he believed, he would make sure that he wrote it down within 30 minutes of learning about it. The purpose behind that was that he said he would make a habit of doing this because otherwise his mind would automatically reject that idea and he’d continue on his original path as if he’d never seen it. And basically, this is the inverse of confirmation bias. Like, he’s working hard to combat that. So, usually for me, when it gets triggered, I’ll have a feeling of surprise. That’s often what that means. Really surprise is when your brain is saying that the incoming data stream from your senses doesn’t match this Bayesian model of what it’s expecting. That’s what surprise is.
So, personally for me, I have a tag in my notetaking where I call it a Darwin fact. It’s @Darwinfact. It’s when I come across something that goes against one of my cherished beliefs. I made it this bright yellow color, so it stands out and really jumps off the page at me. And so, periodically, I’ll go back and review my Darwin facts over a period of time because I can just click on that tag and see it. I’ll think about how it conflicts with these cherished beliefs that I hold onto. What I’m trying to do is pull my brain back away from arriving at too firmly at any conclusion, especially when there’s disconfirming evidence staring me right in the face. So, I think it’s just good thought hygiene in general to point out your Darwin facts for yourself, and that way you don’t end up on the confirmation bias superhighway that takes you far from reality.
Tobias: Have you had a Darwin fact change your mind on anything?
Jake: Boy, that’s a good question. Nothing jumps to mind at the moment, but it certainly pulls me back from just the certainty. Like, just dialing back the certainty. Even when I’m feeling very, very strongly about something, a Darwin fact will at least stop and make me to reexamine and recalibrate.
Bill: This reminds me a little bit of Adam Robinson’s concept of looking into things that make no sense to you and things that make a lot of sense. I think where it rhymes is like, the things that make no sense. It’s probably your brain doesn’t fully see the world as the world is.
Tobias: No doubt.
Bill: I remember he had said he’s like, “You can make a lot of money in both those scenarios.” I think, one is because you actually really understand the scenario, and the other is because you’re probably not thinking about it. If you can get yourself to that spot, maybe it helps. Maybe you’d say, this still doesn’t make any sense. Like, what happened to AAMC, that call which I liked. I said I liked that pitch a long time ago, but then they turned in an EV car company, and that I do not like. Thankfully, I was not long. The stock went down 90%.
Tobias: That’s Darwin fact.
Bill: Market didn’t like it either. That is a Darwin fact. But maybe now it’s worth looking at, right? I don’t know.
Exploring Financial Curiosities and Fiscal Years
Tobias: We got a question from the audience. “Jake, can you name someone your list that were yellow,” or just give us a flavor of what sort of stuff you made yellow?
Bill: This is proprietary IP, folks. You got to pay the man for this.
Jake: No, not necessarily. Let me look real quick and see where I’ve got some–
Bill: I’ll tell you what it is. In 2017, he has in big, bold letters, billage is schmuck. And then we met each other and he was like, “There’s a Darwin fact here. He’s maybe not as good as I thought.”
Jake: It’s not true. Some of these are so idiosyncratic. They might not be that interesting for– Well, here’s one that popped up. Gosh, I was researching a company, and the fisc–like, they put year to date and then, July 9th, 2023. What would you imagine that the time period of measurement is when it comes to year to date, July 9th, 2023? What’s the dates that’s measuring?
Tobias: Yeah, I’m guessing that the way that you asked the question is June 30th to July 9th, but you would expect it to be January 1th to July 9th.
Bill: I actually thought June 30th, but yeah. It’s got to have some weird fiscal end. It has to.
Jake: It was a fiscal year to date, but doesn’t say fiscal year to date. And so, I caught it and I thought, “Oh, gosh, how many times have I actually made this mistake without realizing that I was adding up.” What I thought was nine months or seven months’ worth of data, but was really a year’s worth of data. That’s a big difference.
Bill: We should outlaw fiscal years that don’t end on 12/31. I’ll run on that.
Tobias: That makes a lot of sense.
Bill: Yeah, you don’t get to make your own year? That’s not how it works.
Tobias: But having said that, Australia is June 30 for tax. That throws everything, and then you can pick your own for the public company. April, I’ve seen all of them. I’ve got an April year end. April– [crosstalk]
Jake: All right, here’s another one I had. This was profit margins going up in my face even further from what I thought that they could ever go. So, I put that one in as you thought it was going to regress from 13.3, and it went up to 15.5 in Q2 of 2022.
Bill: I would think the whole COVID– All the economic outcomes would be one huge Darwin effect for me. I don’t even think we know all of them yet, so we shall find out. But I wouldn’t think that we would skate through all that as unscathed as we have. I think the [unintelligible [00:45:58]
Jake: Total debt outstanding for all S&P 500 constituents was 9.5% below 2007 peak. This was in June of last year. I would have thought at that point that the total corporate debt was above 2007 levels. That’s the… stuff that I’m catching myself with.
Bill: Anything to do with the composition, like, where financial is a big component of the S&P, highly levered?
Cardboard Usage And Morgan Housel’s Publishing Journey
Tobias: I’ve got a weird fact that– I got this one from Morgan Housel. I don’t know if this is true or not, but Morgan said it. So, I haven’t verified it myself, but he says that, “There’s less cardboard used today than there was in the 1990s.”
Jake: Has he seen anyone’s porch?
Tobias: He said that in the context of knowing that. I don’t know if they make the cardboard boxes. Maybe they’re half the thickness, but even then, you’d think– Maybe it’s recycled faster, I don’t know.
Bill: Yeah, I could see that. That’s a nice thought. Smart.
Tobias: Those are good.
Jake: Cardboard returns.
Jake: Not maybe.
Tobias: I got to check that one. I shouldn’t have said that was it. But there’s the source. [unintelligible [00:47:11] is the source on that one.
Bill: Sure, he’s fine with it.
Tobias: I’m sure he said it publicly. I’m sure it’s come from a Tweet. I don’t think I got that one from the horse’s mouth. I didn’t get that one direct. So, I’ve got this very important piece of information I have to tell you. The future– [crosstalk]
Bill: Here’s a Darwin fact, and I don’t think I’m like talking out of school here because he told us all in a public setting, and I’m sure he’s told the story previously. But here’s an interesting tidbit of Morgan’s history. That book almost every publisher said no to, despite how well read the blog post is. I think he was on his last shot with a publisher when they finally said like, “Yeah, we’ll do it.” And look at what a success that was. And good for him for sticking with it. Yeah, almost no one wanted to have a– [crosstalk]
Tobias: [crosstalk] huge built in audience.
Bill: I know. He was like, “Look at how many people have read this blog post.” Like, “I can do a book on this.” And people are like, “No, we don’t like it.”
Tobias: Well, Harriman’s a good publisher. So, he did well there.
Jake: Fair play to you.
Tobias: It’s good for Harriman too. That’s their big winner to those guys there. Happy for them both.
Jake: [laughs] That was a financial Harry Potter. [chuckles]
Tobias: Yeah. [crosstalk] that’s right.
Bill: Can I compliment you on a serious pro move? Last week when you were asking Corey about an ETF that he may or may not have currently registered, you are a pro.
Tobias: Who asked that? Me?
Bill: Yeah. It was a fantastic question that you asked.
Tobias: Leading objection.
Bill: Yeah, that is great. This is amazing.
Tobias: I’ll have to go back and watch the tape on that one. Do it again.
Bill: A pro’s pro, man.
Tobias: It was a monkey typewriter question. Just the words came out in the right order. Say enough words, those things will happen. Ask enough questions, those things will happen.
Bill: You knew what you were doing. It was strong.
Comfort Levels And Travel Preferences
Tobias: What’s the market look like to you, guys? How are you feeling, just generally, stop around?
Tobias: [laughs] Yeah, that’s fair. That’s fair. Is that an age setting or that’s your comfort setting?
Bill: I don’t know. It’s probably somewhat where I am at life. I think your gross numbers relative to your spend matter a lot. So, I don’t think that you can just take a formula and apply it. But I think it gives me enough where if I were to take the 20% in a hyper aggressive scenario, I could change my life for the better. If that never happens and the 70 grows, my life should better over time, as long as I can manage my spending. It’s a comfort that I can deal with.
Jake: [unintelligible [00:50:01]
Bill: Yeah. But I wouldn’t spend it on NetJets, man. That shit’s wasteful.
Jake: Go straight to the G6.
Bill: No, it’s not good for the environment. It costs too much money. I actually strongly disagree that flying–
Tobias: G6, not good for the environment. Write that down.
Bill: If I actually did something that my time mattered.
Jake: You are not going to get invited to [unintelligible [00:50:22] with that kind of attitude, buddy.
Bill: Yeah. Look, I’d never fly coach again, ever. Don’t get me wrong, but I don’t need to fly private.
Tobias: You’re not going to own the G6. You’re going to get the NetJet subscription.
Bill: No, it’s like seven grand an hour, man. It’s disgusting to me. That money can go to much better causes. Send kids to school for that kind of money. I don’t need that shit. I’m no saint with money. I’m not trying to say that.
Jake: The back of the plane of the plane gets there at the same time as the front of the plane, Billy.
Bill: Yeah. Well, I would pay for all the upgrades for all the travel and all the airports, okay? I might have my own entrance. I’m not saying that I wouldn’t be flying coach with y’all, but I wouldn’t be on NetJets.
Jake: It’s like a stoic exercise. That’s what Munger would be flying. He’d fly coach even when he was really wealthy, because he just wanted to stay in touch with the common man.
Tobias: That’s like Vipassana meditation. You got to fold your body into those seats and be in pain for six hours on the way to New York, and then you get there, enlightened.
Bill: Mark [crosstalk] says, he does that.
Tobias: I think he said he pays for it himself. There’s no way that man is flying coach. He’s 6’7″ and he’s got to be 250-ish probably that’s being generous. [crosstalk] I’m not nearly that size, and I get my knees right up against the back of the seat.
Jake: Yeah, I don’t have a problem with that up being super tall. So, I just get in my little seat and read my book.
Tobias: [laughs] Swing your legs.
Jake: Yeah, like a little kid.[laughter]
Bill: That was funny. Anyway.
Tobias: Yeah, “Mark used to fly coach, he stopped.” Thank you, hive mind.
Bill: All right, who’s got questions?
Market Speculation: Betting On All-Time Highs
Tobias: We’re like 6% from all-time highs. 6.8% from all-time highs. Who wants to take a bet on whether we get there or not? Throw your bids in the comments too, so we can find someone to– When do we get to all-time highs? If you say we don’t get there, give us a reason why. Obviously, we’re getting to all-time highs at some point again in the future. In this current run up, it seems inevitable from this point. Like, 6.6% is nothing.
Bill: Yeah. I don’t know, man. I am conflicting opinions on this. On one hand, I think you’re right. And on the other, I know Jake agrees with this. I don’t know that he articulates his bearish market thoughts quite as much as we do. But I do think it would just beautiful from an observation standpoint to touch the highs and then just destroy everybody. I just think that would be poetic, right?
Jake: [unintelligible [00:53:22] like Max Payne.
Bill: Yeah. You got to get everybody to be like, “Shit, I should have been long,” and then just rip their soul out.
Tobias: Do you think when it gets over– The people who follow the 200 day, when it goes over the 200 day, everybody’s like, “Yeah, it’s all. Get back in the water, boys. It’s safe to swim.”
Bill: Yeah. Or, some 50:20 or 200 crossover, right? Some sort of momentum in [unintelligible [00:53:45]
Tobias: The golden cross. You know what? We haven’t heard death cross for a little while.
Bill: No, that’s right.
Tobias: The death cross is the reverse– [crosstalk]
Jake: Hindenburg omen. Is that still a thing?
Bill: No. Yeah.
Tobias: I can never figure out what that is.
Jake: I don’t remember this.
Tobias: 13 things have to happen for the Hindenburg omen.
Bill: Seems to be a lot of stuff out there that’s still cheap though. I don’t know. I guess, my strongest opinion is if you’re fishing in a pond from $1 billion to call it $8 billion, there’s probably some good values out there. I think they’ll probably outperform the index, but I don’t know what the index is going to do.
Jake: My strongest opinion is that if the business makes sense to you and you think you’re getting a good deal, go ahead and buy it and suffer with equanimity, if the price moves against– [crosstalk]
Bill: [soundboard sound] [laughter]
Jake: Damn it. We missed you, Bill.
Tobias: The soundboard works.
Jake: It finally works. [laughs]
Bill: Way to jump in with the right answer, Jake. Thanks.
Tobias: Yeah, that is technically correct, which is the best kind of correct.
Bill: Doesn’t get good ratings though.
Tobias: It does not.
Bill: We never had Twizzler money. Thank you, Jake.
Inflation and Economic Realities
Tobias: There’s a few good comments here. Ron Zolla says, “Nominal highs in inflationary period are expected, aren’t they? Talk in real terms!” I agree, but what are we going to use as the deflator? I guess, we can use CPI as a deflator cumulative.
Jake: Cumulative, what? 14% or something over the last couple of years?
Tobias: Yeah. How are you met? Something like 80% of all the money outstanding was printed in the last few years.
Bill: I am willing to admit that it doesn’t feel transitory when I go buy eggs.
Tobias: I can see it in my Mint account. The spending in my Mint account is like– I’ve adopted another child or something. It seems to be–
Jake: Like, a red little leaf now instead of green? [laughs]
Tobias: I’ve got this extra member of the family or I’ve doubled the size of my family. There’s a lot of spending in there.
Jake: Name him Jerome.
Tobias: Yeah, that’s right. I think Jerome is doing the best that he can with what he’s got. I like what he’s doing for the most part. I think he’s getting there as long as he keeps on cranking it.
Bill: He’s got two mandates, right? So, he’s got to do one until the other breaks.
Tobias: I’ve also got climate change in there now too. You’ve got full employment, price stability, climate change.
Bill: The thing that I think should keep everybody up at night is inflation came down in a period where oil came down. What if we get inflation that rips again, and then where do rates have to go, and then what does the world look like? I think that’s the scary scenario. I know that I’m three years late on this thought and whatever, but I’m just saying, I don’t think people are still thinking inflation being the real risk.
Jake: I don’t think they might have been thinking that in 1975, and they thought, “Oh, the worst of it was behind us. We’re on the other side of the–” It was transitory. And then, “Oh, shoot–” [crosstalk]
Tobias: We’re going to see that just now, because the peak in terms of the rate of change was June last year. And so, we’ve been seeing that the year-on-year figures have been coming down, but we’ve got rid of that base effect, and so now we’re going to see for the next few months. Quarters, the base effect is going to go back up again. So, that’s going to be interesting. Let’s see what it does.
Bill: Yeah, trueflation is down, but my food and my gas ain’t.
Tobias: It’s no longer going up. The prices aren’t going down. They’re just going to stay where they are.
Tobias: So, if your income is flat year on year and your costs have gone up 40%, then in real terms, there’s a lot less left over at the end of the month.
Bill: Better than owning debt though, I guess, because the debt spends a lot worse too.
Tobias: Exactly. Can’t buy as many hamburgers when you get your principal back.
Bill: Took the kids to the Federal Reserve of Chicago, indoctrinated them with the man.
Bill: No, I did not.
Tobias: Don’t do that. Don’t do that. Don’t do that. I’m joking.
Bill: It’s actually a pretty fun little museum that you can see a million dollars in ones, twenties, and hundreds. It’s cool to see the difference in the volume of the cubes. Blew the kids minds. Then they give out shredded money, and my oldest, he’s like, “Can we put this together?” I’m like, “No, dude, that’s not going to work.” I love the thought, not going to work.
Jake: There you go, hustler.
Tobias: Shredded money is fun.
Tobias: There was an Australian stock market promoter takeover guy. He said he shredded his first million.
Bill: That’s gangster.
Jake: How is it true that you stuffed it into the–? [crosstalk]
Tobias: Stay hungry. [laughs] Keep hustling.
Bill: Yeah. I might deposit it and then shred the bank statement.
Tobias: Yeah. Take it as a check and then just frame it.
Bill: Yeah, that’s right.
Jake: After you deposited.
Bill: Yeah, that’s right.
Tobias: All right, fellas, we made it. That’s full time. Thanks, everybody.
Bill: Nice seeing you, guys.
Jake: Love you, Billy.
Bill: Yeah, love you, guys, too. Love the listeners, except the ones that don’t love me, but I still got love for you.
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