Latest / Felix Nikolas Prehn's Podcast / ⚠️Paypal Stock: Everyone is WRONG! w/ Jesse @Micro2Macr0

Transcript

⚠️Paypal Stock: Everyone is WRONG! w/ Jesse @Micro2Macr0 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Welcome, or should you say welcome, I'm not sure.
• 0:02
  Speaker 1: We're streaming, I think, to two YouTube channels and Twitter, which is exciting.
• 0:05
  Speaker 2: Yeah, yeah, and I need to be super.
• 0:10
  Speaker 1: YouTube.
• 0:10
  Speaker 1: Jesse is super, super nice to finally have you on screen.
• 0:14
  Speaker 1: If you don't follow Jesse, you can see his Twitter handle and his YouTube handle there on the on the screen.
• 0:20
  Speaker 1: It's more organized than me.
• 0:21
  Speaker 1: Give him a follow.
• 0:22
  Speaker 1: That's how I find you.
• 0:24
  Speaker 1: You were putting out incredibly insightful Content, especially on PayPal, but also other subjects, and I thought let's have a chat and let's see.
• 0:32
  Speaker 1: Especially with the frustration around PayPal, the last few days.
• 0:37
  Speaker 2: I think for me to a lot of people.
• 0:40
  Speaker 1: Yeah, a lot of people, like after earnings, were like hang on, this was meant to go to the moon, what the heck happened.
• 0:45
  Speaker 1: So I think it'd be interesting to like dive a little deeper into that and sort of see where it takes us and we obviously doing it live.
• 0:51
  Speaker 1: So, guys, feel free to hit us with your, with your questions.
• 0:54
  Speaker 1: So when do you want to kick off down?
• 0:58
  Speaker 1: 81% since all-time highs.
• 1:01
  Speaker 2: Yeah, yeah, make it a good investment I.
• 1:02
  Speaker 2: Did not necessarily not that in and of itself.
• 1:06
  Speaker 2: No, it does not.
• 1:07
  Speaker 2: I think.
• 1:08
  Speaker 2: How do I share my screen in here?
• 1:10
  Speaker 2: I don't even know I'm.
• 1:13
  Speaker 2: Oh, I see it.
• 1:13
  Speaker 2: I see that.
• 1:14
  Speaker 2: Let me see here.
• 1:14
  Speaker 2: I'll pull something up here real quick.
• 1:17
  Speaker 2: I think that'll be, helpful.
• 1:21
  Speaker 1: Okay, brilliant, there we go.
• 1:22
  Speaker 2: Yeah, okay, all right.
• 1:23
  Speaker 2: So this is PayPal.
• 1:24
  Speaker 2: So I'll just talk real quickly about their earnings.
• 1:27
  Speaker 2: They actually went really really well.
• 1:30
  Speaker 2: Outside of forward guidance.
• 1:32
  Speaker 2: They they beat transaction margins.
• 1:34
  Speaker 2: I was happy about that.
• 1:35
  Speaker 2: Active customer accounts They've been dropping for a while.
• 1:39
  Speaker 2: Total payment volume went up.
• 1:40
  Speaker 2: Revenue segment went up.
• 1:41
  Speaker 2: Net income was good.
• 1:42
  Speaker 2: Cash Logo, like everything, looked pretty good.
• 1:45
  Speaker 2: And again these guys these guys have the ability to be able to buy back 10.5 billion dollars in stock.
• 1:52
  Speaker 2: They have authorization throughout about this year and they buy at least, I think, six and a half.
• 1:58
  Speaker 1: What's the market?
• 1:59
  Speaker 1: Up 60 billion or something no.
• 2:02
  Speaker 2: Yeah, yeah, I think right around there and I could pull it up.
• 2:05
  Speaker 2: But yeah, it's right around 60 billion.
• 2:07
  Speaker 2: It's a high market cap, but again, when you're pulling, it.
• 2:10
  Speaker 1: But I mean that's that's, that's 15% of market cap, right yeah?
• 2:15
  Speaker 2: that's not bad, it's not, it's not a horrible number.
• 2:17
  Speaker 2: And again, there's other metrics.
• 2:18
  Speaker 2: Here too, just real quickly, the take rate actually went up.
• 2:22
  Speaker 2: That's something that's been bothering me.
• 2:23
  Speaker 2: And and and number of payment transactions oh no, transactions per count, the quality of their customers getting better.
• 2:30
  Speaker 2: And then if you look at like operating leverage here, you could see I can't expand it.
• 2:35
  Speaker 2: Oh, there we go.
• 2:36
  Speaker 2: You didn't know how to use the screens that I have.
• 2:38
  Speaker 2: You could see how Revenue is going up and the operating expenses are staying pretty flat.
• 2:43
  Speaker 2: And this is all before Alex, chris.
• 2:45
  Speaker 2: So I'm really excited about this, this company and its potential, and I think outside of Alex Initially flubbing like a lot of this, a lot of this With presentation, the shock, the world thing yeah, that's a bit prefaced, a little bit better.
• 3:02
  Speaker 2: That didn't work out and there was like a merchant video.
• 3:04
  Speaker 2: It was a great merchant video and it highlighted all the stuff that they're doing To make the product better and I think they could very quickly make things better.
• 3:12
  Speaker 2: But it was definitely a flub and people weren't happy.
• 3:16
  Speaker 1: Yeah, you should have said I'm gonna.
• 3:17
  Speaker 1: I'm gonna shock the technical guys at merchants.
• 3:22
  Speaker 2: Yeah, for technical guys.
• 3:25
  Speaker 2: Yeah, yeah, no for sure.
• 3:27
  Speaker 1: Oh yeah, I was kind of like they're saying echo in my chat.
• 3:31
  Speaker 1: Let me see, let's fix audio quick, let me um, let me see if there's something on my end.
• 3:40
  Speaker 2: Yeah, I try turning down on my.
• 3:42
  Speaker 2: I've got my echo Constellation on?
• 3:44
  Speaker 1: is it?
• 3:44
  Speaker 1: Is it?
• 3:45
  Speaker 1: Let us know which one of us you hear as echo?
• 3:47
  Speaker 1: If it's both of us, once I can do something about that.
• 3:49
  Speaker 1: I.
• 3:53
  Speaker 2: One sec.
• 3:53
  Speaker 2: I'm gonna kill that.
• 3:55
  Speaker 1: That's the, that's the fun of being alive.
• 3:58
  Speaker 2: Yeah, yeah, what'd you say?
• 3:59
  Speaker 2: Feel like sorry.
• 4:00
  Speaker 1: I said here Okay, I'm only, I'm echoing too.
• 4:05
  Speaker 1: Okay, let me um.
• 4:07
  Speaker 1: Let me see if I can put on headphones.
• 4:09
  Speaker 1: Yeah, I don't hear it.
• 4:11
  Speaker 2: But Maybe that'll stereo audio.
• 4:14
  Speaker 2: Okay, rose, I do have.
• 4:16
  Speaker 2: We only have Jesse and echo.
• 4:18
  Speaker 1: Echo stopped.
• 4:19
  Speaker 1: Okay, all right.
• 4:22
  Speaker 2: You guys, is it better or worse?
• 4:25
  Speaker 2: Yeah, I'm echoing.
• 4:28
  Speaker 2: Okay, let me see here.
• 4:30
  Speaker 1: Okay, some of you guys now I think, okay, let me, let me switch over to a headphone on the output Audio.
• 4:36
  Speaker 1: Okay, brilliant, jesse, can I still hear you?
• 4:42
  Speaker 1: Yeah, I can hear you.
• 4:43
  Speaker 1: Can you hear me?
• 4:44
  Speaker 1: Okay, brilliant.
• 4:45
  Speaker 2: Yeah, I can hear you perfectly, too Perfect.
• 4:47
  Speaker 1: Okay, sometimes my headphones are a bit funky, but okay, cool, I think that's probably better right.
• 4:58
  Speaker 2: Let's see what are people saying.
• 4:59
  Speaker 2: Can you guys hear?
• 4:59
  Speaker 2: Well, now Is it better, all good now.
• 5:02
  Speaker 1: Okay, okay, cool.
• 5:04
  Speaker 1: It might have been my, my speakers might be my mic that was picking up the speakers.
• 5:07
  Speaker 2: So, yeah, this is always fun, and I'm using a new setup too, so this is a.
• 5:12
  Speaker 2: It's bound to be something right.
• 5:13
  Speaker 2: All right, we start over.
• 5:15
  Speaker 2: Okay, cool.
• 5:17
  Speaker 1: No, I love what you're saying in terms of like numbers, and I think it's good to dive a little bit deeper.
• 5:21
  Speaker 1: And obviously guys in the chat feel free to ask if something doesn't make make sense and you know sometimes we use acronyms that only makes sense and so on.
• 5:28
  Speaker 1: But yeah, I mean, if you look at, you know profit per share, earnings per share was up like 24% last year.
• 5:32
  Speaker 1: That's not horrible, right, that's not horrible.
• 5:37
  Speaker 1: Um, but Maybe we can talk a little bit about like expectations and what the new CEO's announced.
• 5:44
  Speaker 1: A bunch of things he's gonna improve, but I think people were sort of thinking brilliant, he's gonna do that on day two.
• 5:49
  Speaker 1: And yeah, yeah, if you run a business with tens of thousands of employees, first of all you got to figure out who the heck is who and, and you know, get rid of the people and they're getting rid of, like what nine, ten percent of staff.
• 5:59
  Speaker 1: Yep, figure out that out and then improve the product.
• 6:04
  Speaker 1: So I think people's Expectations which I think what we saw from earnings where, where, like this is all gonna turn around within a quarter, and now he's basically guided and said I need a year, which is kind of always what I thought what do you think the chances are of him actually Surprising us on that?
• 6:21
  Speaker 1: Do you think that's a low ball or what do you know?
• 6:23
  Speaker 1: I do think it's a low ball, but I do I also think you're right.
• 6:30
  Speaker 2: And I don't know if people's expectations are the same as mine, because I've got options for this.
• 6:34
  Speaker 2: I've got a lot of money and options.
• 6:35
  Speaker 2: This is probably this is one of the worst trades I've done in the last year and a half.
• 6:38
  Speaker 2: I bought leaps.
• 6:39
  Speaker 2: I bought them in June, may or May or June of last year, and I did that because I made a bunch of money off of Tesla and meta and Palantir and Bitcoin mining stocks.
• 6:51
  Speaker 2: Doing that same thing, I thought, okay, well, let's find some more.
• 6:54
  Speaker 2: Okay, here's hood, here's so far.
• 6:56
  Speaker 2: Here's PayPal.
• 6:57
  Speaker 2: These look like they're ready to pop.
• 6:59
  Speaker 2: Fundamentals look good, there's some catalysts in the future that are nice.
• 7:01
  Speaker 2: Let's go ahead and buy it.
• 7:03
  Speaker 2: So already I'm like eight months too early, which sucks.
• 7:09
  Speaker 2: But I think something similar that that you and I have in common is we both like leaps because we don't like theta decay.
• 7:15
  Speaker 2: We don't like time to erode our wealth, and so I'm happy.
• 7:19
  Speaker 2: I did a two-year leap.
• 7:20
  Speaker 2: I wish I had more of a happy.
• 7:22
  Speaker 2: I did a two-year leap.
• 7:23
  Speaker 2: I wish I had more time that left on it.
• 7:28
  Speaker 2: Um and again, I was a little less the two years when I bought it, but I wish I would have done it later and I wish I was in 2026 right now, but I'm still sticking around because I think I'm looking for a narrative shift.
• 7:41
  Speaker 2: So I yeah, my philosophy is kind of like focusing on macro fundamentals and ta, and then there's a nuance with narrative, and right now, the narrative on PayPal is horrific, with it being down, you know, for 1,100 days, essentially from a price of over 300 a share down to 58, 26, over two and a half years later, almost three years.
• 8:07
  Speaker 2: So the narrative is in the garbage can right now and I'm not looking for much.
• 8:13
  Speaker 2: Um, I just want a real simple move.
• 8:16
  Speaker 2: I want it to go, um, I just want it to go up here to the, to the next trend line.
• 8:22
  Speaker 2: I think I have the right one.
• 8:23
  Speaker 2: I says paypal, yeah, it is okay.
• 8:25
  Speaker 1: And so I'm just looking for.
• 8:28
  Speaker 2: Yeah, yeah, yeah.
• 8:29
  Speaker 2: So I'm looking for a mean reversion.
• 8:31
  Speaker 2: I need to adjust some of my lines because they're off, so I'm looking for a mean reversion.
• 8:35
  Speaker 2: All I'm looking for is getting to a hundred dollars.
• 8:37
  Speaker 1: That's all I care about with paypal.
• 8:38
  Speaker 2: Okay, um, I'm not looking for 140.
• 8:41
  Speaker 2: People might think that because my strike was 140, but that's just because I was looking for a wicked premium so I could capture extrinsic value from it.
• 8:49
  Speaker 2: And um, so I'm looking for a mean reversion, I'm looking for 66 percent upside, and if it does that, it isn't much.
• 8:57
  Speaker 2: No, it's not, it's not much.
• 8:59
  Speaker 2: And so, again, I'm just looking for the narrative to not be garbage.
• 9:02
  Speaker 2: Yeah, in the next to this kind of turn around.
• 9:06
  Speaker 1: The way I always look at.
• 9:07
  Speaker 1: Look at it in terms of stocks.
• 9:09
  Speaker 1: I always think, like a stock that falls every 10 percent of stock falls Is like falling out of one story of a building.
• 9:16
  Speaker 1: So if you fall out of the first floor, you're down 10 percent.
• 9:19
  Speaker 1: You're gonna get up, you'll be all right.
• 9:20
  Speaker 1: So this is eight floors right.
• 9:22
  Speaker 1: So you are basically in a coma and most of your bones are broken and it's gonna take you a couple of years to recover, and I think people often underestimate how long it takes Once the narrative is garbage.
• 9:32
  Speaker 1: As you say.
• 9:33
  Speaker 1: The institutions are out.
• 9:35
  Speaker 1: They all pissed off, right?
• 9:36
  Speaker 1: The pension funds are pissed off.
• 9:37
  Speaker 1: Loads of fund managers lost money on this.
• 9:39
  Speaker 1: How to justify it to their investors why they did this stupid bet and that lost the money.
• 9:45
  Speaker 1: So quite hard to get them back in.
• 9:47
  Speaker 1: And I think there is a lot of animosity towards PayPal management.
• 9:50
  Speaker 1: I don't know.
• 9:51
  Speaker 1: There was a.
• 9:51
  Speaker 1: There's a big British, there's a big British fund called fundsmith I actually have a lot of my money with them and and they were one of the biggest PayPal shareholders and they sold at the end of, I want to say, 2022, which was a smart move, I think around 160 dollars and he actually, in his annual letter.
• 10:10
  Speaker 1: The half of the thing was about how agitated he was about PayPal management, how arrogant they were and they were doing all these mergers and they weren't giving any numbers.
• 10:18
  Speaker 1: There was no incentive for management to do anything decent.
• 10:21
  Speaker 1: They were just wasting money and they weren't responding to him at all.
• 10:25
  Speaker 1: And he's not not a guy.
• 10:26
  Speaker 1: He wants a board seat, but he's just like just give us some data, right, just tell us some.
• 10:30
  Speaker 1: Answer a question.
• 10:31
  Speaker 1: They just weren't responding.
• 10:32
  Speaker 1: And if that's one of your biggest shareholders like yeah, they're just going to leave and to get them back, you're going to have to do some serious whining and dining and sweet talking and improve your, your margins, right?
• 10:43
  Speaker 1: So if your business is declining and you're a dick to your major institution, investors the way the last CEO was.
• 10:52
  Speaker 1: It's going to take time to get those guys back on board and you need institutional money to move a stock like this.
• 10:56
  Speaker 1: It's just too big 60 billion dollars, right?
• 10:59
  Speaker 1: It's not like you and I are going to move it, um, so yeah, that's interesting perspective.
• 11:04
  Speaker 1: Maybe I Okay the whole leap philosophy, right?
• 11:09
  Speaker 1: So we're both options traders, so we have a lot in common on that front.
• 11:14
  Speaker 1: I must say, I've almost never buy leap options.
• 11:17
  Speaker 1: I always look at it as like Gambling on something really really far down the road that I have zero control over.
• 11:26
  Speaker 1: Um, I prefer to trade it shorter term throughout the whole thing.
• 11:31
  Speaker 1: So, like I had a bearish trade on paper, I made money on it yesterday, right, yeah?
• 11:36
  Speaker 2: Yeah.
• 11:36
  Speaker 1: Yeah, and it gives me that flexibility.
• 11:38
  Speaker 1: I feel I have some visibility a week or two out.
• 11:42
  Speaker 1: I don't know what the heck's gonna happen by 2026, but I can see there are exceptions to it when you think something is really Not necessarily undervalued.
• 11:53
  Speaker 1: But the likelihood of PayPal screwing this up so badly that they'll still be at 58 dollars in two years time Seems relatively low right, sure, yeah, yeah, I'm looking for a flip.
• 12:06
  Speaker 2: So, yeah, I'm looking for the swing.
• 12:07
  Speaker 2: That's the big thing with me.
• 12:08
  Speaker 2: And, and you're right, it can take a while and that could be the case with PayPal.
• 12:12
  Speaker 2: That definitely could.
• 12:13
  Speaker 2: But if we look at, like Palantir, meta, tesla, all of these that got beat up pretty bad their charts actually look really similar to this.
• 12:21
  Speaker 2: Even square, if we pull it square, the chart looks similar to this.
• 12:24
  Speaker 2: It didn't keep it from jumping, you know, 100 plus percent over a short period of time.
• 12:28
  Speaker 2: And Again, I look at the list of all the things that these guys have started to do right and I will not lie, the narrative for this company in 2021 and 2022, even from a political standpoint, the woke left narrative was horrific and it still lingers over the stock right now.
• 12:48
  Speaker 2: When you start freezing people's money because they're protesting in Canada and then you also threaten to start finding accounts for misinformation on social media, I mean, what is misinformation?
• 13:03
  Speaker 2: I say stuff all the time.
• 13:04
  Speaker 2: Am I going to get fined?
• 13:05
  Speaker 2: Are you guys going to take money from my account?
• 13:07
  Speaker 2: It was just the worst PR that could possibly exist in this stock, but I kind of love that.
• 13:15
  Speaker 2: That's the stuff that I enjoy.
• 13:17
  Speaker 2: I love finding a diamond in the rough where it has been devastated and then look for an opportunity for it to flip, because you're right, the actual growth on this.
• 13:29
  Speaker 2: For it to get back to its highs is going to take years, most likely years, to get back to the $300 level.
• 13:36
  Speaker 2: If you look at the market cycle chart, it doesn't happen right away, but a mean reversion to where this thing's been grinding for the last two years.
• 13:46
  Speaker 2: That's very doable.
• 13:48
  Speaker 2: That's all I look for.
• 13:49
  Speaker 2: I choose the leaps because I don't have to worry about wicked amounts of Theta decay.
• 13:54
  Speaker 2: If I'm way out of the money and it's an unrealistic target, then you'll have more Theta decay, just like having a shorter threshold of time.
• 14:03
  Speaker 2: But I love the fact that I have years when I look like for this one.
• 14:09
  Speaker 2: I just use this basic options calculator.
• 14:11
  Speaker 2: You can see I put way too much money into this.
• 14:13
  Speaker 2: I put $336,000.
• 14:15
  Speaker 2: That's more than I would put normally.
• 14:17
  Speaker 2: I just kept dragging myself into it.
• 14:19
  Speaker 2: I don't suggest anybody do this.
• 14:22
  Speaker 2: But if I just need reverts to that target.
• 14:24
  Speaker 2: If I get that 66%, if that happened in April, after the next earnings call let's say the end of April it's $2.3 million off of $336.
• 14:34
  Speaker 2: If it happens after the earnings in July, it's $1.284 million.
• 14:39
  Speaker 2: This isn't perfect.
• 14:40
  Speaker 2: It's a facsimile of what you would get.
• 14:43
  Speaker 2: There's so many other variables with open interest and volume and all that stuff.
• 14:47
  Speaker 2: These are good numbers.
• 14:49
  Speaker 2: Still, I would prefer that I have more time because you're right, after that last conference call it was not super special and having more time would be nice for sure.
• 15:02
  Speaker 1: I think, though, there is a my feeling is that April isn't going to be a great set of data either, because I think it's going to take them longer, but if they can start showing product improvements and maybe they can start showing some advertising revenue, maybe in the June July earnings, and then, in, he said they were going to, he said they were going to have product deployments.
• 15:23
  Speaker 2: Yeah, he said they were going to have product deployments in two weeks to a couple of months in regard to mobile app and other stuff.
• 15:29
  Speaker 2: It was a real quick comment, but you're right, I think they need product improvements.
• 15:35
  Speaker 2: The great thing is this stock has been in the shitter for over two years and that's the big benefit to me right now, because we're underneath the volume peak.
• 15:46
  Speaker 2: But man, once we get above that 76 range, it's an easy trip to mean reversion, in my opinion, just where we get up here near $100.
• 15:57
  Speaker 2: And I could see that happening really quickly with this stock.
• 16:01
  Speaker 1: So I but they need to change.
• 16:03
  Speaker 1: I love.
• 16:04
  Speaker 1: Oh sorry, go ahead.
• 16:05
  Speaker 1: No, sorry, I think there needs to be news from PayPal.
• 16:09
  Speaker 1: I think people are going to get their hopes up that something amazing is going to happen between now and the next couple of weeks or months, and you have to think what's the news item that's going to move this?
• 16:19
  Speaker 2: So maybe, yeah, I think they're not talking and having any improvement whatsoever.
• 16:24
  Speaker 2: I do agree, though, I think, if they could show product enhancements, if they can have a couple of things coming up, I'm hoping, after this next earnings, that either A they're laying off more people and or we're starting to see some changes that are benefiting where they can show any progress, a little bit of progress, and speak to it, and if they don't literally try and tank the call like they did this last time.
• 16:49
  Speaker 2: I mean, the CFO jumped out there and she's like yeah, we're just horrible with the business and we're all over the place and we don't have any focus and it's a bunch of stuff we got to get rid of.
• 17:00
  Speaker 2: It's like, oh, wow, this is great.
• 17:01
  Speaker 2: Oh, and we're not going to grow at all over the next year, it's okay.
• 17:04
  Speaker 2: So I love the fact that it's down this low and that they've set that expectation.
• 17:11
  Speaker 1: Yeah, Low expectation.
• 17:12
  Speaker 1: That's a smart thing to do for new management, right.
• 17:14
  Speaker 1: If you're coming in and if you think about it, the previous earnings call he wasn't really in charge yet.
• 17:19
  Speaker 1: Alex, right, he just walked in the building.
• 17:21
  Speaker 1: Everybody was still working for the old guy basically, so it was kind of like a hey and that was pretty much it, Whereas if you come in with a new team, like a politician, you say everything that's gone wrong ever was the last guy's fault, and then you sort of set a very low bar and then you build it up and then you sort of improve it.
• 17:41
  Speaker 1: It's smart that they've done that.
• 17:43
  Speaker 1: Obviously, Shell this didn't enjoy it, but it sets the bar very low and it makes me think he's a little bit more strategic and it makes me hope that he's sandbagging us somewhat.
• 17:55
  Speaker 1: But the only yeah, the risk I think with it is if you've ever done anything in software, you will realize most things take longer than you'd like them to, and ultimately they need that's actually the ministry.
• 18:07
  Speaker 2: yeah, I get it.
• 18:08
  Speaker 2: I totally do.
• 18:09
  Speaker 1: Cool and they need to combine a bunch of apps, a bunch of backends, a bunch of systems that are all pretty much unchanged since 1999 or something like that Pretty much.
• 18:21
  Speaker 2: It's pretty horrible yeah.
• 18:23
  Speaker 2: It's a great a buying thing.
• 18:26
  Speaker 1: Yeah, exactly, and they're not combining it right, not integrating it at all, and it's just.
• 18:31
  Speaker 1: I mean, the interface is pretty horrible, the app is pretty horrible.
• 18:35
  Speaker 2: Oh, it's my worst complaint.
• 18:36
  Speaker 2: The mobile app there is.
• 18:38
  Speaker 2: Like I tried to use that at a store.
• 18:40
  Speaker 2: When you compare that to like anything in Asia where you just pop up a barcode and pay and then you look at the PayPal mobile app, it is complete trash.
• 18:50
  Speaker 2: The reason like I was happy that he actually made a comment about it sucking in the last earnings call, because I'm appalled by it.
• 18:59
  Speaker 2: I spent 15 minutes at a grocery store trying to purchase something that said that they could take PayPal and the management couldn't figure it out.
• 19:07
  Speaker 2: I couldn't figure it out.
• 19:08
  Speaker 2: When I opened the app there were like seven different ways to send money with all slightly different descriptions.
• 19:15
  Speaker 2: Nothing was intuitive.
• 19:17
  Speaker 2: It could just you could eliminate 90% of it.
• 19:19
  Speaker 2: From a software standpoint, I used to help develop our mobile app.
• 19:23
  Speaker 2: I didn't develop it, but I helped manage the development of it for a previous company and then I also worked as a manager and an account manager for a software company that worked with Urgent Care Medical System.
• 19:35
  Speaker 2: So like I've been appalled by this stuff and I'm happy that he's pushing to consolidate Venmo and PayPal apps.
• 19:44
  Speaker 2: That is going to be a nightmare, you're right, but I love, like some of the other stuff that they were talking about doing, like making the guest checkout process super simple and stupid easy, where somebody could just do it, not have to punch in a bunch of information, have it work across everybody they're working with where they punch in their email and maybe do some kind of authentication.
• 20:05
  Speaker 2: I love the biometric thing.
• 20:07
  Speaker 2: It's like they're finally doing all these things, and some of these are loaning fruit.
• 20:12
  Speaker 1: I mean, everybody's done this, like years ago, right, like every other house.
• 20:16
  Speaker 2: But the great thing is like I love the advertising aspect too of what they're looking to do.
• 20:21
  Speaker 2: They have they're 25% of commerce, and I think with big commerce they already had them on their.
• 20:28
  Speaker 2: I don't remember something like the past pay service, whatever it was.
• 20:31
  Speaker 2: They had them working on it in.
• 20:33
  Speaker 2: Their conversion rate was like 70% and that's an awesome rate.
• 20:37
  Speaker 2: And so and they have all this data 25% of e-commerce like that's a huge data warehouse.
• 20:42
  Speaker 2: That is wealth.
• 20:43
  Speaker 2: That is like the meta, amazon, youtube, way of making money.
• 20:50
  Speaker 2: You help connect people through the data.
• 20:53
  Speaker 2: If somebody wants to buy something, you should push them to merchants that are on the platform, all this stuff and you should use it for advertising.
• 21:01
  Speaker 2: They can make tons of money off of this.
• 21:03
  Speaker 2: And I love the fact that he said that they had already consolidated a bunch of data silos like into one unified warehouse.
• 21:10
  Speaker 2: That in and of itself, in the short period of time he's been there, got me excited too.
• 21:16
  Speaker 2: There's just a lot of little things I think that these guys can do, but, to be clear, like that trade of mine could go to zero Again.
• 21:23
  Speaker 2: This is the worst trade I've done in a year and a half.
• 21:25
  Speaker 2: I could just say goodbye to $330,000.
• 21:28
  Speaker 2: That is a distinct possibility.
• 21:29
  Speaker 2: I hope it doesn't happen.
• 21:31
  Speaker 2: I would prefer to make $2 million plus off of it.
• 21:36
  Speaker 1: I hope you do.
• 21:37
  Speaker 2: Yeah, but it's possible, though, and I'm going into it knowing that.
• 21:40
  Speaker 2: So anybody who's doing this too should realize that this is an asymmetric bet one of many and I am willing to lose it all I know.
• 21:49
  Speaker 2: I've watched a bunch of your videos, felix.
• 21:51
  Speaker 2: You're more conservative than I am.
• 21:54
  Speaker 2: You're doing a stock portfolio and then you have trading.
• 21:56
  Speaker 2: I am not that way.
• 21:58
  Speaker 2: I am pretty crazy Probably creates more stress than I need in my life.
• 22:01
  Speaker 2: I like asymmetric bets that are 10 baggers, and that's how I made 700% in the last year and I've got a pretty good track record over the last five.
• 22:11
  Speaker 2: But again, it comes with risk too.
• 22:14
  Speaker 2: I made 700%.
• 22:15
  Speaker 2: Now I'm probably down 29 this year.
• 22:19
  Speaker 1: So that's kind of the nature of the beat.
• 22:20
  Speaker 1: I totally understand the philosophy and obviously a lot of my guys do the same thing.
• 22:25
  Speaker 1: I just think it's one of the reasons I do it the way I do it is my mindset doesn't love a lot of up and down.
• 22:33
  Speaker 1: And I think for to do the asymmetric thing, which is basically where you're putting in 100K and you're hoping to make a million or two or something like that, it's very hard on the mindset, right, because you will lose the majority of those trades and then when you do make money, you make a lot of money.
• 22:47
  Speaker 1: It's very, very hard to do for most people, especially when then you are trading.
• 22:51
  Speaker 1: So I generally teach people to do the high probability trade instead.
• 22:57
  Speaker 1: Have a 70, 80% chance of making money.
• 23:00
  Speaker 1: You'll make a little bit of money, but you'll make a little bit of money pretty much every other day and that's a lot softer on the mindset.
• 23:06
  Speaker 1: And then some people want to.
• 23:09
  Speaker 1: Then, once they really master that and they've got their rules and their structure and they really understand what the heck they're doing, then I think it might be a good idea, if you're so programmed in your brain, to maybe go for the asymmetric route, but no, I totally get it I mean, I don't think 99% of people should do what I do.
• 23:27
  Speaker 1: No, probably not, Probably not.
• 23:29
  Speaker 1: They will just lose their house and home, but you're doing it with a smile, which means you're able to handle it, which is the difference.
• 23:35
  Speaker 1: So there is never one right or wrong way, I think, of trading or investing.
• 23:41
  Speaker 1: Agreed, but it has to work for you, and I think that's one of the things people need to figure out when they start to trade.
• 23:48
  Speaker 1: It's like if you're waking up in the middle of the night and you're worried about your trade, or you're checking your screen every 50 seconds, then it's not the right strategy for you.
• 23:57
  Speaker 2: You're in trouble.
• 23:58
  Speaker 2: I used to be that way, so I understand that too.
• 24:01
  Speaker 1: Yeah, exactly, and that's where we all start off.
• 24:02
  Speaker 1: And now I'm super chilled with my trades because I know I guess today in the morning the market went down, whatever, and I was like brilliant, I can think of four bearish trades I've got to open.
• 24:13
  Speaker 1: They're all going to make me money today and I'll ignore all the rest.
• 24:17
  Speaker 2: Chill, yeah, that's a good idea, that's a good idea.
• 24:20
  Speaker 2: That's a good idea.
• 24:20
  Speaker 2: That's a good idea.
• 24:21
  Speaker 2: I've got edges, but mine are like the world's falling apart hedges.
• 24:23
  Speaker 2: I don't use them for money.
• 24:26
  Speaker 2: I don't use them to make money.
• 24:27
  Speaker 2: I'm hoping just to burn them off.
• 24:29
  Speaker 2: But I totally get that.
• 24:31
  Speaker 2: That's a smart way of doing it too.
• 24:34
  Speaker 1: So it kind of gets you to a similar outcome.
• 24:36
  Speaker 1: It just gets you there a little bit differently, like we were talking about at the beginning, before we went live.
• 24:41
  Speaker 1: Like I was saying, I actually made money on PayPal yesterday because I had a bearish trade-on, which means I made money if I went down and for me that was just the chart, like that big candle dropping four days ago or something.
• 24:54
  Speaker 1: I was like, well, that kind of makes sense and all I needed was one more down day at some point in the next sort of five to 10 days and I'd make some money and I did.
• 25:05
  Speaker 1: So I'm out, but maybe let's just okay.
• 25:08
  Speaker 1: Let's circle back to the advertising thing.
• 25:11
  Speaker 1: For me, honestly, that's the most exciting thing.
• 25:16
  Speaker 1: They're announced.
• 25:16
  Speaker 1: If you look at Amazon, amazon, I think, bring an 80 billion in advertising revenue a quarter, something like that which is more than YouTube, right, which is more than YouTube, and it's a total site business for them and it's huge.
• 25:29
  Speaker 1: And it's just data.
• 25:30
  Speaker 1: If you've got people who spend time on your website or your app and you're not showing them ads, what the hell right?
• 25:37
  Speaker 1: And they don't just know what you visit on search, they know what you bought.
• 25:47
  Speaker 1: So think of all the complimentary things you can do, right, You're buying a phone.
• 25:50
  Speaker 1: Well, show them the phone cover and the accessories and the airports and whatever, right, Like you know what they're doing.
• 25:58
  Speaker 1: Plus, you know a lot about their income and they basically know everything about us, right?
• 26:02
  Speaker 1: They know how we're paying it, they know the credit cards we have, they know our addresses.
• 26:06
  Speaker 1: They really, really know the customer.
• 26:08
  Speaker 1: So it's insane that they haven't used that.
• 26:10
  Speaker 1: The question is, how long is it gonna take them?
• 26:13
  Speaker 1: They should ring up Palantir and get their data silos sorted out.
• 26:17
  Speaker 1: I think that might be a good idea.
• 26:19
  Speaker 2: Yeah, honestly, that wouldn't be a bad idea.
• 26:20
  Speaker 2: I do, though.
• 26:21
  Speaker 2: I look at and I posted something like this about Intuit and cause.
• 26:27
  Speaker 2: Alex Chris comes from there and he was there for like 19 years and showing the stock price since he was there and it was like 3,400% overnight.
• 26:36
  Speaker 2: It's one of the most beautiful charts he'd ever seen, so like, and he helped with a large part of, like you know, product enhancements and just trying to refine the product, and so I think if anybody can do it, I think it's him.
• 26:50
  Speaker 2: But again, it could totally, this could totally fail.
• 26:52
  Speaker 2: This has been my worst trade.
• 26:53
  Speaker 2: I'm ready for it to fail.
• 26:56
  Speaker 2: It'll be a bummer because I made like 600,000 off at Palantir, so if I lose half of it on PayPal I'll be bummed out.
• 27:01
  Speaker 2: But I still think genuinely that this one can still play out and that I can make a bunch of money off it.
• 27:08
  Speaker 2: If it hits 75 to 100.
• 27:10
  Speaker 2: And I think it can mean revert to 100.
• 27:12
  Speaker 2: And if I get that 66% upside between now and July gives me like two earnings reads for Q1 and Q2, that I can make a bunch of money.
• 27:21
  Speaker 1: But if I was somebody If you get to 100 by the mid-year, I think it's a possibility on the 90s or something.
• 27:25
  Speaker 2: But if I was you you wanna do it I would be in 2026.
• 27:28
  Speaker 2: Personally, I would be in 2026.
• 27:33
  Speaker 1: If you wanna do this kind of like long out trade by a leap, yeah, I'd go out probably to 2026.
• 27:39
  Speaker 1: Cause your risk then is that they will not deliver at all on anything.
• 27:44
  Speaker 1: I mean literally, cause, if you look at the valuation, I always look at like, okay, people look at PE number, price earnings multiples, which is a terrible thing to look at generally, but it's like at 11 right now, which just seems fairly cheap.
• 27:58
  Speaker 1: But the only thing I actually look at is like how is that changing over time?
• 28:02
  Speaker 1: And if you fast forward 10 years, it'll be like a 3X multiple or something like that.
• 28:09
  Speaker 1: Based on what?
• 28:09
  Speaker 1: 10% growth a year, which is nothing right On earnings, is basically just sucking a couple of people.
• 28:16
  Speaker 1: So it's almost like it's such a value play.
• 28:20
  Speaker 1: It's almost hard to imagine that they can screw it up that badly over that time horizon.
• 28:26
  Speaker 2: So yeah, I think and without much cash and authorization to buy back and the buybacks.
• 28:30
  Speaker 1: I mean, if you're buying back 15% of your your or say, say, 7% or something like that of your stock a year, how is that stock not gonna go up?
• 28:39
  Speaker 1: And your profits are going up.
• 28:41
  Speaker 1: What was it this year?
• 28:43
  Speaker 1: 24%, I think, something like that how are you not gonna see some improvement in share price?
• 28:49
  Speaker 1: It's kind of hard to fathom.
• 28:51
  Speaker 1: I mean, people have to really just give up hope and just say you are the worst company in the world with the worst management.
• 28:56
  Speaker 1: So and it's an I think it's it's expanding too.
• 29:00
  Speaker 2: I actually believe that FinTech will help absorb traditional banking that isn't moving quickly, legacy bankers with physical infrastructure that aren't like these Asian places where everything is on an app Like it doesn't make sense anymore.
• 29:15
  Speaker 2: So, like companies like here in the States, like SoFi and PayPal, that are digital platform that have just been this one's been dying for a decade, they have the ability to transform themselves in a market that is growing and they have 10.5 billion in buybacks.
• 29:32
  Speaker 2: They can do.
• 29:32
  Speaker 2: That alone would give them a decent amount of growth.
• 29:35
  Speaker 2: Fire another 90% and then consolidate one portion of the app.
• 29:39
  Speaker 2: Figure out where you can lose the least amount of revenue but wipe out a ton of operating expense and complexity and make it to where they talked about how they want it.
• 29:50
  Speaker 2: They're trying to increase engineering velocity and I love that.
• 29:53
  Speaker 2: That's this focus, because you got to get rid of all the crap, focus on what makes you money and then be able to engineer in a way, have like complete view of your data set and then engineer and develop products.
• 30:05
  Speaker 2: I love the fact that he's even got a vision on his new product line right now and it's pretty clear and concise.
• 30:11
  Speaker 2: Like I don't know, this is a trade that I'm still excited about, not as excited as I was eight months ago.
• 30:19
  Speaker 2: Sorry about that Another way to be more excited.
• 30:22
  Speaker 1: When you talk about engineering, what's your thoughts on, because I know you're majorly into crypto space, and what's your thought on PayPal stablecoin?
• 30:32
  Speaker 2: I like it and it's growing and I don't know what they're doing with it.
• 30:35
  Speaker 2: This would be another thing that I'd love to hear in the next conference call.
• 30:37
  Speaker 2: I'd love to know what are you guys doing with it?
• 30:41
  Speaker 1: So to someone who doesn't know what the heck that is.
• 30:42
  Speaker 1: What's the value proposition of PayPal stablecoin Like?
• 30:46
  Speaker 1: Why do we need that versus?
• 30:48
  Speaker 2: It's a digital dollar and so, but it can be transferred at a fraction of the cost is what it takes to go through the traditional banking system.
• 30:56
  Speaker 2: If anybody's sent like money, especially internationally really helpful for international trade.
• 31:02
  Speaker 2: If you've tried to wire funds across, like, let's say, from the United States to Africa, there's about a billion people with their hands in that pot and maybe you'll get 60% of the money there.
• 31:12
  Speaker 2: But even to a lesser degree, if you're getting charged like credit cards 2%, 3% or cross-border trades where it's like 5% or even more double digits, that is so much money and expense and with stablecoins and blockchain you don't have that.
• 31:30
  Speaker 2: The overhead is way lower.
• 31:32
  Speaker 2: You could still be in compliance and you can move money really quick and fast and that's the benefit for them, especially in cross-border trade.
• 31:39
  Speaker 2: They can use and they can use this to where they can back it with treasuries and they can make it to where they're earning yield and they're giving yield back to people and there's a ton of cool stuff they could do, similar to some of the stuff that Robinhood's getting ready to do right now with gold membership, and I think that they could do some of that here with the stablecoin and I think it would be brilliant I mean Tether I don't know what they made last quarter, but like they've got an 80 billion or something dollar stablecoin If PayPal becomes like the fourth highest one and the other ones underneath of that are trash, and I think they could do that this cycle and like the next year and a half.
• 32:15
  Speaker 2: That in and of itself would help them with revenues and again just with expanding their products and doing things for cheaper.
• 32:21
  Speaker 2: I think, especially with something like PayPal, if they could do more QR base not just online, not just easy like biometric, like I just paid for something real quickly with my thumb and I didn't have to go through all the BS but if they could do that in the store too, they could start to get it to where they can get to a point where credit card machines go away and they become the future or at least one of the companies.
• 32:43
  Speaker 2: That's the future, and so I think the sector is really exciting.
• 32:46
  Speaker 2: I think that these guys can do a lot of great stuff in it.
• 32:49
  Speaker 2: They've got a horrible past and I'm hoping Alex is the future and I've got mixed results so far.
• 32:57
  Speaker 2: He shocked the world, definitely, but I think-, yeah, he shocked the world of a really boring presentation.
• 33:03
  Speaker 2: So we already talked about the in-store checkouts.
• 33:06
  Speaker 1: I mean, there was an interview out in a couple of years, back when Elon was spending some time in China visiting his factory there, and one of the things he was saying is like they've got this great app here, it's called WeChat and you can do everything with it.
• 33:21
  Speaker 1: You can pay with it, you can make calls with it.
• 33:23
  Speaker 1: It's like everything in one app.
• 33:24
  Speaker 1: And then he buys Twitter and he's now turning Twitter basically into WeChat oh, he's totally making them.
• 33:29
  Speaker 1: Yeah, yeah, which is ironic because you know an American company knocking off innovation.
• 33:37
  Speaker 2: Chinese.
• 33:38
  Speaker 1: But I suppose you know, some people are saying, okay, but that's gonna kill PayPal, or Apple's pay is gonna kill PayPal, and I think, from my point of view, okay, the core business at the moment is online merchants and they are the largest market share and that isn't really dwindling very much, so quite hard to actually get at that.
• 33:56
  Speaker 1: But, yeah, the in-store checkout thing is gonna get more competitive and I think down the road there will be probably two people doing it, a bit like Visa, mastercard, and the question is, is PayPal gonna be one of those?
• 34:08
  Speaker 1: I mean, I think if they could be, that'd be amazing.
• 34:11
  Speaker 1: Don't know if that's likely.
• 34:14
  Speaker 2: Yeah, I think they can be.
• 34:15
  Speaker 2: I think they can be at least in the like, the buy now, pay later portion of things they're actually doing.
• 34:21
  Speaker 2: Quite well, Let me yeah, that's better.
• 34:23
  Speaker 2: So, like, when you look at other competitors, they're like at the top of the list.
• 34:27
  Speaker 2: And again, for like online purchases, they're at the top of the list.
• 34:31
  Speaker 2: These guys are the big dogs.
• 34:33
  Speaker 2: They're way above everybody else, and it's really just a matter of product refinement now and not pissing off 40% of your customers by making political statements that aren't needed from a company that should just be focused on product.
• 34:50
  Speaker 2: But I think if they could do that, stuff like these guys can crush it.
• 34:55
  Speaker 2: They can crush it in the future, and so this will probably be a bet.
• 34:58
  Speaker 2: Even if I don't win on this one, I'll probably, if I lose 60, 70%, maybe 80, 90, whatever I'll probably still stack out longer.
• 35:08
  Speaker 2: You'll probably do it again.
• 35:09
  Speaker 2: If only if I see the right moves from them.
• 35:11
  Speaker 1: As long as I can do it right, start I mean the whole buy now, pay later.
• 35:15
  Speaker 1: I think it's sort of ethically probably one of the worst things to do in the world, because it's kind of like you're maxed out on your consumer debt and your credit cards and now you can do buy now, pay later.
• 35:26
  Speaker 2: On top of it, yeah, and you know I don't have to, but some of it, though, is better than credit cards, and credit cards suck if they're like a lot of people mismanage them and they go to the default rate and they just in debt themselves.
• 35:38
  Speaker 1: 60% of people do anyway, which is shocking.
• 35:40
  Speaker 2: Yeah, it's definitely so.
• 35:42
  Speaker 2: This is like another version of that, from what I've seen.
• 35:45
  Speaker 2: The rates are a little bit better.
• 35:46
  Speaker 2: I never use it, but people do, and it's becoming more popular.
• 35:50
  Speaker 2: I'm not sure why people like being so indebted, but they do, but I do think that.
• 35:56
  Speaker 2: I think that this could be if the economy takes a massive shit.
• 36:00
  Speaker 2: This could be a negative for PayPal Having a bunch of loans that hopefully are good.
• 36:07
  Speaker 1: But they're selling them off right.
• 36:08
  Speaker 1: They're selling them to private equity.
• 36:09
  Speaker 1: Yeah, I think they do that with a lot.
• 36:10
  Speaker 2: Yeah, yeah, I think the churn is pretty high, which is good.
• 36:13
  Speaker 2: That's definitely something you want, which is very good.
• 36:16
  Speaker 1: So you basically you bring it in and you sell it off.
• 36:18
  Speaker 1: You make a profit, but the risk is no longer yours.
• 36:21
  Speaker 1: You pass it on to some credit shark somewhere else.
• 36:23
  Speaker 2: That was like the 2008 mortgage collapse, but yeah.
• 36:26
  Speaker 1: And then, exactly, they repackage it and they make all these crappy loans, look golden and sell it off to somebody else who doesn't know what.
• 36:32
  Speaker 1: It is probably a regional bank.
• 36:34
  Speaker 1: Yeah, that's probably what's gonna happen down the road.
• 36:36
  Speaker 1: But no, I agree with you, I think it's a big thing.
• 36:39
  Speaker 1: And people just I think we've been taught to perhaps sort of instant gratification so much that people just wanna buy stuff.
• 36:47
  Speaker 1: Now, right, apple brings out a $3,000 headset, people wanna buy it.
• 36:51
  Speaker 1: Even though that's what they make a month, they're just gonna fricking buy it.
• 36:54
  Speaker 1: On BMPL.
• 36:55
  Speaker 1: Yeah, it's insane.
• 36:56
  Speaker 1: It's insane, but it's just.
• 36:59
  Speaker 1: If you're PayPal, well, that's the drug you push, right, so you're gonna make money on that.
• 37:05
  Speaker 1: So I think it's a brilliant business move.
• 37:07
  Speaker 1: I'd love to see them roll that out internationally as well, because it's just US based at the moment and I think there is something up for grab there.
• 37:15
  Speaker 1: I don't know if that's a regulatory thing or something, why they're not doing it, but yeah, I think there's a lot of opportunity.
• 37:20
  Speaker 1: I totally agree with you, and it's tiny right At the moment in terms of revenue for PayPal.
• 37:23
  Speaker 1: It's like non-existent BMPL, but that's gonna really, really grow out for sure.
• 37:28
  Speaker 2: There's all these levers, all these little levers, and if they can just find any direction at all, again, I think the narrative can do it.
• 37:35
  Speaker 2: Yeah, yeah, yeah, but I think they're capable of it.
• 37:39
  Speaker 2: We'll see what happens.
• 37:40
  Speaker 2: I'm hopeful, but one of many plays.
• 37:45
  Speaker 1: Totally.
• 37:46
  Speaker 1: Someone's just saying in Europe.
• 37:48
  Speaker 1: They sold them to KKR, which is one of the big private equity sharks out there.
• 37:52
  Speaker 1: They sold all those.
• 37:53
  Speaker 1: I think they also sold future BNPL numbers.
• 37:57
  Speaker 1: It's like a deal they basically just take them off the paper.
• 38:00
  Speaker 2: Oh okay, I think they sold almost a batch six months out or something, yeah.
• 38:03
  Speaker 1: They say here is five and a million and I think the next four billion you'll also get at like a fixed.
• 38:08
  Speaker 1: Obviously there must be some limit on credit ratings and that kind of thing, but it just means it goes off balance sheet and the risk is no longer pay pals.
• 38:16
  Speaker 1: I think that's the smart thing to do, because paypal is good at bringing it in.
• 38:20
  Speaker 1: They're not necessarily the greatest at collecting the money or any of that, so just who wants the liability?
• 38:26
  Speaker 2: Yeah, yeah.
• 38:27
  Speaker 1: Exactly.
• 38:29
  Speaker 1: And what if the economy does go to shit?
• 38:30
  Speaker 1: Then he wants to deal with that.
• 38:32
  Speaker 1: So you'd rather some private equity shark you undoubtedly do also sell it on.
• 38:37
  Speaker 2: It's just somebody else.
• 38:40
  Speaker 1: So that's a smart thing to do and I think that's what we see with everybody right Like SoFi's loan book and everybody who basically brings in money tends to sell it on.
• 38:50
  Speaker 1: It's sort of like the insurance version of the loan book thing.
• 38:56
  Speaker 2: Definitely got something from the housing sector, I'm sure.
• 39:00
  Speaker 1: Yeah, I know Well, the problem with that is just like if your rating agencies are corrupt, right, that's the problem.
• 39:07
  Speaker 1: Like that was 2008, wasn't it.
• 39:08
  Speaker 1: They were just like here are the thousand really crummy loans, and by putting a thousand crummy loans together we'll make them triple A.
• 39:15
  Speaker 2: And you're like yeah, that was the game.
• 39:18
  Speaker 1: How does that come?
• 39:19
  Speaker 1: Really, does that make it?
• 39:21
  Speaker 1: You know, because the original idea was you put some great ones, some good ones, some decent ones, some crappy ones, you put them together and that way you got an average rating and then it's less horrible than if you just have the crap.
• 39:31
  Speaker 1: But they just bundled crap and somehow convinced the world.
• 39:34
  Speaker 2: It was diversified shit and that's what makes it better.
• 39:37
  Speaker 2: That's what gave it triple A.
• 39:38
  Speaker 2: It's diversified new risk 100%.
• 39:42
  Speaker 1: So you know that was.
• 39:43
  Speaker 1: That was insane, so hopefully we're not seeing that again on this one.
• 39:47
  Speaker 2: No, not here in the States.
• 39:49
  Speaker 2: I don't know about every country, but adjustable rate mortgages and that kind of stuff just doesn't exist.
• 39:55
  Speaker 2: There isn't the fever with the housing, so we're pretty safe here.
• 39:57
  Speaker 2: But but yeah, and I think the economy here is strong and I think that the other CPI data was a little shocking, was higher than I thought it was going to be.
• 40:05
  Speaker 2: I don't know how accurate it is.
• 40:07
  Speaker 2: There's a bunch of stuff talking about seasonality and then shelter was two thirds of it and I think that number is going to come down.
• 40:14
  Speaker 2: But there's this tax and insurance.
• 40:16
  Speaker 2: That's went up a lot over the last year and that's probably adding to it.
• 40:20
  Speaker 2: And then illegal immigration and trying to house people.
• 40:23
  Speaker 2: There's just a lot of crap going on.
• 40:24
  Speaker 2: But but the thing with the CPI and the shelter component that I I think that's being misjudged right now is it's constrictive towards monetary policy right now, in my opinion, because again, if insurance and taxes and things are driving up prices, that's pulling away from consumer spending and making it affordable for them.
• 40:47
  Speaker 2: So you're you're already looking at a tightening mechanism.
• 40:49
  Speaker 2: That shouldn't be like, oh hey, because it's high and mostly shelter, we should actually keep rates high because we don't want to make them low because that's inflation.
• 40:59
  Speaker 2: It's like that's a stupid idea because you just reduce disposable income, right?
• 41:03
  Speaker 1: You've just like, yeah, you got to pay your rent, Otherwise you know, yeah, and if that's the inflation part.
• 41:09
  Speaker 2: if the inflation part is constrictive and lowering spending, that's not really much of an inflation.
• 41:15
  Speaker 2: So my thesis is still that we should be lowering.
• 41:18
  Speaker 2: Soon We'll see what happens, but, but, but yeah hopefully, hopefully.
• 41:24
  Speaker 1: I kind of think the inflation data was a little nonsense.
• 41:25
  Speaker 1: There is a great website called trueflationcom.
• 41:28
  Speaker 2: I love it.
• 41:29
  Speaker 2: It's the only thing I listen to, so I made my money last year.
• 41:32
  Speaker 1: Did you?
• 41:33
  Speaker 1: Okay?
• 41:33
  Speaker 1: And it shows inflation.
• 41:34
  Speaker 1: Is what like 2% or something?
• 41:35
  Speaker 1: It's, it's just and it was.
• 41:37
  Speaker 1: It was like 11%, so it was way.
• 41:39
  Speaker 1: It was way higher than the government ever admitted and now it's way lower.
• 41:42
  Speaker 1: So it's kind of like problem is kind of taken care of.
• 41:45
  Speaker 1: But I think the Fed I always thought the Fed would be too conservative and will sit on their hands for too long Because they're sort of haunted by the ghosts of the 1970s and you know when they, when they basically brought inflation down and then caused it again like three times in a row and it was a total disaster.
• 42:06
  Speaker 1: And they don't want to do that again, but they just like they always too late and then they do too much and I think that's probably hard not to do, because what they do has an impact, like a year or a year and a half later, but we haven't felt the impact of the rate hikes yet.
• 42:24
  Speaker 1: I would say like probably half of them we haven't really felt it yet.
• 42:28
  Speaker 2: Yeah, yeah, that's the important part.
• 42:30
  Speaker 1: That's what he should be thinking about, so you should be thinking like investment is going to freaking collapse if I leave it at this level.
• 42:37
  Speaker 1: And instead he's like tinkering around and I think he's gonna change, though I've got.
• 42:45
  Speaker 2: I've got this thesis on Powell because again, he was also the inflation is transitory person, so he could tell you all kinds of stuff, right.
• 42:54
  Speaker 2: But then a couple of months later we go from inflation is transitory to oh, by the way, I'm going to hike at the most aggressive rate in history.
• 43:02
  Speaker 2: So I think he has the power.
• 43:04
  Speaker 1: Oh, he's also the guy who printed $4 trillion of money which no one had ever done.
• 43:07
  Speaker 1: Yeah, yeah, yeah, the Treasury too.
• 43:09
  Speaker 2: Yeah, they in Congress, everybody spent a lot of money.
• 43:12
  Speaker 2: That was easy, but I do think that he's very willing, on a dime, to switch things around and there's still stealth liquidity going on, like our Treasury, the bond issue.
• 43:24
  Speaker 2: We used to issue a bunch of coupons.
• 43:25
  Speaker 2: It was like 80 20 coupons and now it's like 70, 30 bonds, long term dated bonds.
• 43:31
  Speaker 2: So they're doing.
• 43:33
  Speaker 2: They're doing things like the reverse repo and the bank term funding program, which is about to expire in March.
• 43:38
  Speaker 2: But they're doing things where they're still allowing liquidity to be able to be pushed out even though they're tightening, even though rates are restrictive.
• 43:46
  Speaker 2: And so I think that they're talking the talk and then I think, in a heartbeat, maybe by like the opus a June.
• 43:55
  Speaker 2: I think they're going to start to flip and I think that can be stimulative, because here in the States our housing market is devastated.
• 44:02
  Speaker 2: It's at the it's at the lowest levels in like 20, 30 years, and so we just haven't been selling.
• 44:09
  Speaker 2: In all, all that's looking to happen to reignite a huge engine in our economy, whether it be the auto sector, whether it be real estate, is just lowering rates, just releasing the valve and so and we've already seen that in refinancing, mortgage refies here in the States so if they like it's already getting better it's way smaller than it would.
• 44:31
  Speaker 2: It should be, but it's, but it's better and so if they release this valve, I feel like the stimulative portion of that could push us higher before we have any major economic downturns.
• 44:42
  Speaker 2: I feel like we could actually go higher.
• 44:44
  Speaker 2: I don't know how much higher, but I feel like we can go higher.
• 44:47
  Speaker 2: I just don't see there's just because we printed almost 40% of the entire money supply in just the last 40 most insane thing ever.
• 44:55
  Speaker 1: And then pointed the finger at other countries and said they cost the inflation, and you know maybe blame it on everybody else, but we literally with adding 40% extra dollars.
• 45:05
  Speaker 2: Yeah, we printed money at such an aggressive rate and then tightened so much.
• 45:09
  Speaker 2: It's just insane when you when, when you look at 40% of the money being created after 2020.
• 45:15
  Speaker 2: And then the couple hundred years before that a little bit less from when they're counting, and it's just, it's mind boggling.
• 45:22
  Speaker 2: And then you look at the bond market had the worst route since the 17 hundreds.
• 45:28
  Speaker 2: It's just a crazy time.
• 45:33
  Speaker 2: But I but I actually think we could have a meltup.
• 45:35
  Speaker 2: I think it's where nothing like the 70s, and I think once they release that valve, we could actually go higher.
• 45:41
  Speaker 2: I could totally be wrong and I wouldn't know.
• 45:45
  Speaker 1: That's why I have my I mean, I think, always I always look at it like follow the money, like he's making money out of this, right.
• 45:52
  Speaker 1: So the the other money printing that 40% extra dollars there is.
• 45:56
  Speaker 1: It drove asset prices up, right.
• 45:58
  Speaker 1: It gave us the stock bubble and the housing bubble and, like everything, everything has gone up.
• 46:02
  Speaker 1: So who made money?
• 46:03
  Speaker 1: Well, the people who owned all the assets.
• 46:04
  Speaker 1: So the top 1% got very, very much wealthier and screw everybody on salaries.
• 46:09
  Speaker 1: And then we raised interest rates a bit.
• 46:12
  Speaker 1: But in reality, the big companies benefited from it because they actually have cash and they could, they can, finance themselves very cheaply on the market.
• 46:22
  Speaker 1: And all the small caps.
• 46:23
  Speaker 1: You know.
• 46:24
  Speaker 1: That's why IWM, the Russell, was down like 3.5% at the open yesterday, because, you know, all those unprofitable small companies are like on the brink and they got to go to the bank and pay 7, 8, 9, 10%, right.
• 46:36
  Speaker 1: And then now they're going to lower rates, and I think you're right, I think they have to, and it might be May or June or maybe even July, but then they're going to have to do it quite aggressively because look at commercial real estate, right, that's a total basket case and that's all going to, that's almost a trillion dollars that has to refinance this year at market rates and the Fed knows and they keep saying it that they will basically all go bankrupt I mean not all, but maybe 30% of them unless rates come down.
• 47:08
  Speaker 1: So they're going to have to do that.
• 47:09
  Speaker 1: And then again you kind of think well, that benefit, who does that benefit?
• 47:13
  Speaker 1: Well, of course it's the guys who are asset rich.
• 47:15
  Speaker 1: Right, it's Wall Street, because they will be able to refinance lower, they'll be able to buy the distressed property from the smaller guys and it's going to be.
• 47:22
  Speaker 1: It's going to be great, great for business.
• 47:24
  Speaker 1: So I kind of think the whole thing is just run for essentially Wall Street and you know the few percent of people that actually have all the asset, maybe the 0.1%, and that's just what the cycle is.
• 47:35
  Speaker 1: And because they pay your politicians, and it's the same everywhere in the world, and so the system is working for that.
• 47:42
  Speaker 2: I totally agree with everything you just said.
• 47:44
  Speaker 2: And also in the banking sector, here we've had this concern about regional banks and potential collapse.
• 47:50
  Speaker 2: Well, I mean, after SBB, they basically said, hey, well, insurer depositors, there's no bank collapses anymore that we care about.
• 47:56
  Speaker 2: Well, I don't think they give a shit about banks.
• 48:00
  Speaker 2: And I listened to a former banker I think it was from Truis he's a brilliant guy he was.
• 48:05
  Speaker 2: He was basically saying, yeah, they want to consolidate banks.
• 48:07
  Speaker 2: Maybe you have 2030 regionally, but you shouldn't have 100, especially like in smaller states or more.
• 48:14
  Speaker 2: And so they they're okay with letting them die and then be bought up by the JPMorgan's of the world.
• 48:20
  Speaker 1: I think that's a great depression that JPMorgan the only good regional bank who got a JPMorgan and they got it basically for free.
• 48:28
  Speaker 1: The government underwrote all the risk and they got all the things they wanted.
• 48:33
  Speaker 2: The government took all the risks, 100% Exactly.
• 48:35
  Speaker 1: And now the next quarter JPMorgan goes oh, we have an adjustment in the value of that bank.
• 48:41
  Speaker 1: I don't know what it was 10 billion extra or something, and you know bonus season.
• 48:45
  Speaker 1: So yeah, it's just it's just rigged that way and it's just.
• 48:47
  Speaker 1: I agree with you.
• 48:48
  Speaker 1: I think the more they squeeze out the small banks, the more the big three, four, five benefit.
• 48:54
  Speaker 1: And I think you'll see that again.
• 48:54
  Speaker 1: I mean 11th of March, this bailout runs out.
• 48:57
  Speaker 1: Right, there'll be another one.
• 48:58
  Speaker 1: They'll call it something different, you know, the make America safe again act, or something stupid, and and but yeah, they'll bail it out and they'll probably let the small ones not fail but get gobbled up, like you say, so that JPMorgan, you know, make some more money.
• 49:16
  Speaker 2: And I'll say this too it's not just to save, like commercial real estate, it's to save the government.
• 49:23
  Speaker 2: They can't.
• 49:24
  Speaker 2: They can't sustainably manage issuance of long term like they can do long term debt.
• 49:30
  Speaker 2: They can't do coupons over short periods of time, but they could push out long term debt.
• 49:34
  Speaker 2: That's like four or 5% bonds.
• 49:37
  Speaker 2: They could do that right, but they can't have that be a number with the amount of debt that we have for a long period of time before debt becomes the main thing we're paying each year.
• 49:50
  Speaker 2: So they they have to have rates come down to a more sustainable level and have have rates of bond issuance rates that are more sustainable and that aren't expanding at a parabolic rate like we've been doing.
• 50:04
  Speaker 2: Between all the money printing and the bond issuance that's supposed to, bond issuance is probably going to pick up.
• 50:09
  Speaker 2: I was looking at bonds for a while but I'm like why should I get into bonds?
• 50:11
  Speaker 2: This is what they're issuing.
• 50:13
  Speaker 2: Their issue a bunch more of this.
• 50:15
  Speaker 1: But like why would I buy bond or something crazy?
• 50:18
  Speaker 2: Yeah, exactly yeah, and it looks great on paper.
• 50:20
  Speaker 2: When you're like, hey, they've had the bonds, have been in a route that's the worst since the 1700s, but it's like, okay, but if they're printing a bunch more, then this could stay this way for a while.
• 50:30
  Speaker 2: It could make PayPal's return look a lot quicker, I think.
• 50:34
  Speaker 2: I kind of feel the bond.
• 50:36
  Speaker 1: The bond trade was over, like I got out of it, I think, in October, november or something, and that worked very well.
• 50:43
  Speaker 1: Those were nice trades made like I don't know, 20% or something, and you know, relatively short period of time, very, very safe trade in a sense.
• 50:51
  Speaker 1: But yeah, it's a bet on rates coming down faster than people think and I think at the moment that doesn't seem to really be the smart thing to do.
• 50:58
  Speaker 1: But yeah, I think you're touching a really good point.
• 51:01
  Speaker 1: There is, like you know, debt interest will be what?
• 51:05
  Speaker 1: Trillion, trillion and a half this year or something.
• 51:08
  Speaker 1: That's more than the defense budget, which is an insane number.
• 51:11
  Speaker 1: So how do you deal with that?
• 51:13
  Speaker 1: You deal with that by A having lower interest rates and B having inflation, the one thing that kills government is inflation money printing?
• 51:21
  Speaker 2: Yeah, it can't be the bad inflation.
• 51:24
  Speaker 1: Because it'll be worth less as a proportion of the economy.
• 51:26
  Speaker 1: Because the economy will inflate, it will get bigger, right?
• 51:29
  Speaker 1: So that's how governments deal with debt.
• 51:32
  Speaker 2: Yeah, but it's important where the inflation comes from is what they care about, and that's why I think they're being a little extra cruel to markets right now, because they don't want it to be inflation that's caused through speculative demand and commodity prices going exponential and wage inflation that's through the roof.
• 51:51
  Speaker 2: They can't have that be the inflation.
• 51:53
  Speaker 2: It's got to be the money printer, because that's what benefits them.
• 51:57
  Speaker 2: So that's where the inflation needs to come from, and so I think they're trying to ensure that they're the inflator and I think they'll be successful at it.
• 52:06
  Speaker 2: But that is a reason why Bitcoin and stocks, and real estate potentially can continue to go up in value, because we are the world is on an unsustainable path of monetary policy.
• 52:20
  Speaker 2: And I think the US will have the cleaners and the dirty laundry, but it's still a really dirty laundry it is.
• 52:27
  Speaker 1: But I think people get put off sometimes by all the shenanigans around politics, and I still think there's a lot of money to be made, and if you're not in it, if you're sitting on the sidelines waiting and hoping for some perfect moment to appear, it's never going to happen.
• 52:42
  Speaker 1: So I just think you just need to be in the market and it doesn't matter really if it goes up or down, like there's always an opportunity, right.
• 52:49
  Speaker 1: But yeah, I think the whole debt thing is an interesting one.
• 52:53
  Speaker 1: No politician is going to come out and say I'm going to raise your taxes and I'm going to cut your services.
• 53:00
  Speaker 1: It's never going to happen.
• 53:01
  Speaker 2: No, that's not popular.
• 53:03
  Speaker 1: It's not.
• 53:04
  Speaker 1: You know exactly.
• 53:04
  Speaker 1: It's like it's.
• 53:05
  Speaker 1: The democracy is not set up that way, right?
• 53:08
  Speaker 1: Because you'd have to be like make a decision that's going to get you not elected Like you.
• 53:14
  Speaker 1: Democracy is based on popularity and therefore it's going to be like here's free stuff, here are less taxes, and they're going to continue to do that.
• 53:22
  Speaker 1: So I think we'll all end up in Japan, which basically means the central bank will own the majority of all debt and all assets.
• 53:30
  Speaker 2: So we live in this weird like it's worked for them.
• 53:34
  Speaker 2: It wasn't supposed to work for Japan at all.
• 53:36
  Speaker 2: Japan's actually doing fairly well right now, but like.
• 53:39
  Speaker 2: But I do think that and this is kind of like a negative tone, talking about all the stuff about like inflation and the government being like again, all all governments around the world are corrupt and love the money.
• 53:50
  Speaker 1: This is the conspiracy part of this live stream.
• 53:53
  Speaker 2: Yeah, yeah, so like that's everywhere, but, but I do think that there's things that are happening.
• 53:58
  Speaker 2: Now.
• 53:58
  Speaker 2: I believe we're in an exponential age of abundance.
• 54:01
  Speaker 2: I think energy around the world will be dropping to levels because, again, we can we get all the energy we need from the sun right now, and then we have nuclear and we have other forms that we can tap into and that's happening more aggressively around the world.
• 54:14
  Speaker 2: I think energy, especially with, like, battery systems, can drop to levels that are a fraction of what it is today.
• 54:21
  Speaker 2: I think that AI and autonomy and robotics are moving at fast paces.
• 54:26
  Speaker 2: I think genomics is doing crazy stuff, and so I think that there's like there's this bad stuff of the old guard, that that collapse, the Roman Empire, you know, expansion and just printing tons of money and like every other civilization in history or a lot of them.
• 54:44
  Speaker 2: But I do think that maybe we can outpace some of that with all the innovation because again, like like Elon was talking about a while ago with you know, optimus, like once you can print GDP through robotics and have these things working in factories and other jobs.
• 55:03
  Speaker 2: The concept of economies and what it changes.
• 55:08
  Speaker 2: It flips on its head and I think there's a lot of Bitcoiners are like oh, you can't have.
• 55:14
  Speaker 2: You know you can't have money printing and inflation, and I get that argument.
• 55:18
  Speaker 2: But there's something called money velocity, where you want money to exchange hands because each time it exchanged hands it's not like a zero sum game.
• 55:25
  Speaker 2: It enriches people.
• 55:27
  Speaker 2: The employee gets paid, the employee goes out and spends money.
• 55:30
  Speaker 2: That business does better, that business has more money.
• 55:33
  Speaker 2: They hire more employees.
• 55:34
  Speaker 2: They can, they could give you know they're making more for their shares, whatever, but it's like it could be a revolving door of wealth creation.
• 55:42
  Speaker 2: So money velocity has a purpose in my mind, and I think this is what some Bitcoiners don't get.
• 55:47
  Speaker 2: But at the same time, I think that you can have in the future this money velocity creation, still like we've been doing the Keynesian economics thing, but at the same time, you could have a store of value like Bitcoin, where and technology and advancing at such a fast rate that it makes the world a better place and it makes these things sustainable and they can coexist for a while.
• 56:11
  Speaker 1: And so I don't like the whole note.
• 56:13
  Speaker 1: Yeah, but I think I'm with you on the robotic side, in the AI side.
• 56:18
  Speaker 1: I think it's the next steam engine, as in.
• 56:20
  Speaker 1: It's just going to make for sure us like a thousand times more productive, and it's going to cause the same problems the steam engine caused, which was like all the farm laborers were suddenly unemployed.
• 56:32
  Speaker 1: That's that's going to happen, and I think people don't realize that yet.
• 56:36
  Speaker 1: If you work in a job where you do something fairly repetitive, your job is going to disappear.
• 56:40
  Speaker 1: You better go and learn something else, and that's why you're seeing just the beginning of it All the big companies laying off tens of thousands of employees.
• 56:50
  Speaker 1: There is so much stuff you can automate.
• 56:53
  Speaker 1: They're going to be able to like sack a heck of a lot of people, because it is just phenomenal what you can do with it.
• 56:58
  Speaker 1: And it's just at the outset.
• 56:59
  Speaker 1: My feeling is that the government is going to come in with this sort of you know, basically pay you a salary.
• 57:07
  Speaker 1: I think that's kind of that's where I think it's going, because they don't want the unrest and that's that's going to bring.
• 57:14
  Speaker 1: So you're going to get this, whatever you want to call it, and I think socially that will not necessarily be a good thing.
• 57:22
  Speaker 1: Most people think wouldn't it be glorious if I could be at home and get paid some amount of money?
• 57:26
  Speaker 1: But you have no sense of satisfaction and achievement and you just kind of sitting there and you're going to drink beer.
• 57:33
  Speaker 1: So I think that's going to be a huge problem and it's going to split society way more into those who are actively doing stuff and using the technology to build something brilliant, which is what I would encourage everybody to do and learn, and then the masses.
• 57:46
  Speaker 1: You will just sit on a sofa and kind of wither and take pharmaceuticals and make sure that way.
• 57:53
  Speaker 2: That is a distinct possibility, I hope I.
• 57:57
  Speaker 2: My wife loves Star Trek and so I'm hoping more for the Star Trek version of the future, where everybody gets this stuff out of a replicator.
• 58:04
  Speaker 2: But people still want to find purpose.
• 58:06
  Speaker 2: And I can relate.
• 58:07
  Speaker 2: Even when I retired a few years ago, like initially the concept of retirement was super exciting to me and my dream had come true.
• 58:14
  Speaker 2: And then I realized everybody else around me is not retired and so I can't just call up my friends and be like hey, you want to hang out?
• 58:20
  Speaker 2: And then they're doing stuff and then they're busy all the time.
• 58:22
  Speaker 2: And then I started to go like huh, and I've watched every show I wanted to watch, I played some video games, I did all this stuff and now I need to do something and so, like I get that it's not.
• 58:34
  Speaker 1: It's not why you on Twitter and you just started the channel and stuff.
• 58:37
  Speaker 2: Yeah, it's funny, but it is.
• 58:38
  Speaker 2: It totally is.
• 58:39
  Speaker 2: I started off in Facebook groups but then they censored the shit out of me so I stopped doing that and then I moved to X and then last year I had like in February, something.
• 58:48
  Speaker 2: I had a couple hundred followers and then it turned into what it is today.
• 58:51
  Speaker 2: But that's what I literally I wanted to figure out.
• 58:53
  Speaker 2: Like it's like OK, I'm doing all this research, Maybe I should start talking to people and conveying it and trying to provide some kind of value to the people around me that I love and just in society, and I think, I think that there's going to be a decent amount of people that get bored and just do something to do something.
• 59:11
  Speaker 2: There's going to be some of them that are like hedonistic and go into orgies and you know, or sitting around in front of the couch and just like thousand pounds.
• 59:18
  Speaker 2: That can happen too.
• 59:19
  Speaker 2: But I think I think I think that it could be positive as well and that there could be, you know, there could be an environment.
• 59:26
  Speaker 1: I very much hope so.
• 59:27
  Speaker 1: I very much hope so.
• 59:28
  Speaker 1: For me it's the same thing like I struggled, doing nothing.
• 59:30
  Speaker 1: I know that, which is one of the things I reasons I do this and it's.
• 59:34
  Speaker 1: I also realize that I need a sense of achievement and some sort of dopamine hit and I get that by by by doing this and by teaching people and seeing.
• 59:46
  Speaker 1: You know, I wake up in the morning so I've got like 35 emails of people saying, hey, this is amazing, I just did this.
• 59:50
  Speaker 1: Incredible and you know, it made this money and stuff and for me that's very, very rewarding from a selfish point of view, but it's also just obviously super nice to see people do, do, do well, if you can have a positive impact.
• 1:00:01
  Speaker 1: And yeah, the whole sitting on the beach thing, I think it wears off for me after about week three.
• 1:00:08
  Speaker 1: I did six weeks of nothing and when I kind of gave up the day job and, man, I was frustrated at the end of that six weeks.
• 1:00:19
  Speaker 2: I was like this is this one.
• 1:00:21
  Speaker 1: No, like I've done all the things I mean.
• 1:00:24
  Speaker 1: What do I do now?
• 1:00:25
  Speaker 1: And, as you say, like people around you tend to be busy.
• 1:00:27
  Speaker 1: I actually have quite a lot of friends now who are sort of semi retired or early retired or and so we can.
• 1:00:34
  Speaker 1: We can do stuff during the week Like we're going to get for a hike tomorrow and that kind of stuff.
• 1:00:38
  Speaker 1: But it's you.
• 1:00:40
  Speaker 1: You need a purpose in life and I think maybe that isn't people's job.
• 1:00:45
  Speaker 1: If your job's boring and sucks, you still need to find that purpose.
• 1:00:47
  Speaker 1: But just replacing the job with doing nothing isn't going to get you to satisfaction.
• 1:00:51
  Speaker 1: So you know you need to find something that you actually think like this is cool and it could be anything, any hobby, anything.
• 1:00:58
  Speaker 1: But I think if you can give value to people and do something social and I think we all are sort of social beasts then that's a really fun thing to do and this is why I think social media is such a cool thing.
• 1:01:10
  Speaker 1: Like the people you know we've got 400 people here watching this life, which is super cool, and you know we we met on on on X and I saw your content and I thought you know what you're talking about.
• 1:01:22
  Speaker 1: I like your sense of humor and I love that you post when you're losing a couple of hundred thousand dollars in a day, which is most people don't do.
• 1:01:29
  Speaker 1: So I thought you know this guy is actually genuine and honest and you know we we're not having a conversation here and thousands of people are going to watch it and that's cool and that's kind of building community and I think that's what people almost lack.
• 1:01:41
  Speaker 1: Like I see that, for example, I flew to Europe two weeks ago on my own, so normally when I used to travel like you chat to people, right, Everyone's wearing the fricking airports, right, no one's talking to anyone except for me.
• 1:01:54
  Speaker 1: I'm the crazy guy.
• 1:01:55
  Speaker 1: He talks to you in the lounge and when you're sitting in your plane and stuff and people are like oh, and then actually people really like it and I met some.
• 1:02:01
  Speaker 1: I met actually two really interesting people and we chatted for like three hours or something in the lounge waiting for a flight and people just don't have that interaction and everyone else is sitting there, things in, looking down and not taking in the world.
• 1:02:15
  Speaker 1: So, yeah, it's, it's.
• 1:02:18
  Speaker 1: I just encourage you, like, take off your fricking airports and just talk to people.
• 1:02:21
  Speaker 2: They'd be surprised, like, by the nice engagements and interactions you have and and you know, I was one of the people that didn't do any of those things.
• 1:02:28
  Speaker 2: This is what, like I didn't.
• 1:02:29
  Speaker 2: Even so, I'm a high school dropout who who avoided speech class because I didn't.
• 1:02:34
  Speaker 2: I couldn't stand in front of a group of people and say anything.
• 1:02:37
  Speaker 2: So it's, my life has had a really strange transition since my retirement, but I do think that that helped too.
• 1:02:43
  Speaker 2: I think that just having some freedom and trying to figure out who I want to be when I grow up, even though I'm in my late 40s it's it does something that helps a lot.
• 1:02:54
  Speaker 2: And then, all of a sudden, you find yourself talking to people because it's like, oh, my friends are all working, so all right, let's talk to this random person over here.
• 1:03:00
  Speaker 2: And then you just start chatting.
• 1:03:01
  Speaker 2: You're like, hey, this is kind of fun.
• 1:03:02
  Speaker 2: Why don't I do this more?
• 1:03:04
  Speaker 2: Why don't I actually try and spend time talking to people around me?
• 1:03:07
  Speaker 2: And I love it and I love you, man.
• 1:03:10
  Speaker 2: Like, I think we're very much aligned in kind of our thought process and the things that we're trying to accomplish in life, and that's why I was excited to come on here with you for sure.
• 1:03:19
  Speaker 1: Yeah, it's same here and it's.
• 1:03:20
  Speaker 1: It's funny, isn't it?
• 1:03:21
  Speaker 1: Like we're on the opposite side of the world, we grew up in completely different places, in cultures and school systems and everything, and and you actually end up with a very, very similar outlook on life, which is kind of interesting, and I think yeah, completely different starts and everything in between it, and I was like absolutely.
• 1:03:37
  Speaker 1: I mean, I grew up in Germany and then the UK and you know I now live sort of between Europe and Hong Kong, which is obviously a completely different world.
• 1:03:44
  Speaker 1: But I think you know we have something in common.
• 1:03:49
  Speaker 1: I think we obviously enjoy finance and making money and sharing it and we get a kick out of seeing people benefit from what we share.
• 1:04:01
  Speaker 1: And I think finance is such a minefield, it's such a weird industry that you know there is no financial education, right?
• 1:04:11
  Speaker 1: It's a fricking scandal and it's it's never going to change, like don't even bother, like lobbying for it, it isn't going to happen.
• 1:04:18
  Speaker 1: Wall Street pays far too much money to Washington to make sure that doesn't happen, because it's very profitable.
• 1:04:23
  Speaker 2: Yeah right, it's been going that way.
• 1:04:25
  Speaker 2: Here in the States it's been like 100 years, you know it's.
• 1:04:27
  Speaker 2: It's it's they.
• 1:04:29
  Speaker 2: They wanted to create workers, not the illusions or people that are, you know, focused on the arts.
• 1:04:34
  Speaker 2: They, they wanted workers and that's what they needed.
• 1:04:36
  Speaker 2: But in the future maybe that changes because, again, with technology, we don't need all the workerbies.
• 1:04:41
  Speaker 2: We might have a bunch of robots run it around, so maybe we can get some of that back.
• 1:04:45
  Speaker 2: I think everybody deserves the freedom that we have Time for that.
• 1:04:49
  Speaker 2: That's my goal is just to give that to as many people as I can.
• 1:04:53
  Speaker 1: I'm completely with you on that Like and it's it's the small things, to start.
• 1:04:57
  Speaker 1: I think people are often like I used to work like 10, 12, 16 hour days for corporates, yeah, and you have no time to think and the only way you get out is if you ever find some time.
• 1:05:07
  Speaker 1: So I was very lucky because I was working a corporate gig and they lent me out to a customer and those guys were working like never.
• 1:05:17
  Speaker 1: I mean, it was just like so, so little work getting done there, like in many large companies, and I thought this is this is brilliant.
• 1:05:23
  Speaker 1: So I plan my exit and I would never have probably done that if I'd been been working.
• 1:05:29
  Speaker 1: You know the insane hours I have.
• 1:05:30
  Speaker 1: So I think if you guys are working a nine to five or a nine to nine or whatever it is, you just got to like make an hour a day or something for you where you start that little site hustle, you start the investment portfolio or work on upwork or whatever it might be, because that is going to give you the optionality, as that grows, to actually make better decisions and be able to get great.
• 1:05:54
  Speaker 2: You got to have to try to think it's really important.
• 1:05:56
  Speaker 2: For me.
• 1:05:57
  Speaker 2: It was reading a book, the Art of Not Giving a Fuck, and I read that book and and all of a sudden I started to look at things differently, because my entire life I looked at as like a servant who was trying to work hard to provide to the master, this person who's way elevated and obviously just a higher state of being in me.
• 1:06:17
  Speaker 2: And so I work like a slave and I did like you said, like all day I would go into work three in the morning sometime and you build someone else's business.
• 1:06:25
  Speaker 2: Yeah, and I worked holidays.
• 1:06:26
  Speaker 2: Nobody cared, they didn't even notice they were gone, they were on their vacation and the art of not giving a fuck.
• 1:06:31
  Speaker 2: It taught me to say no and to try and figure out like OK, you know what investing.
• 1:06:38
  Speaker 2: I remember that from the dot com bubble with my dad, I remember losing a bunch of money myself in 2008, making really bad decisions, not even knowing what options really were, and so like maybe I should try this again.
• 1:06:50
  Speaker 2: And then that turned into Be watching a video of was like a video that was talking to, like showing rats in a cage going through life in this music video, and I at the end of it, I just called my boss and I was like hey, man, I quit, like we need to figure out a plan because I'm leaving and I'm retiring.
• 1:07:09
  Speaker 2: And I only had four hundred thousand dollars, which, even where I live, is not enough money to retire.
• 1:07:14
  Speaker 2: But I knew the Bitcoin halving was coming in a previous cycle and I knew.
• 1:07:18
  Speaker 2: So I knew I knew the stars were aligning and I knew I could make it happen and so I went with it and I don't regret it at all and I think just even even the starting point of just reading that book and looking at life differently and figuring out how to say no so I could develop enough time to think is super important.
• 1:07:36
  Speaker 2: I think that's.
• 1:07:36
  Speaker 2: I think not enough people do that.
• 1:07:38
  Speaker 2: They get caught.
• 1:07:39
  Speaker 2: And let's get the car.
• 1:07:40
  Speaker 2: Well, you bought a really expensive car, and how many of hours of your week do you spend paying for that?
• 1:07:46
  Speaker 2: How many hours a week do you spend paying for your house?
• 1:07:49
  Speaker 2: How much of your life have you pushed off and said these material belongings are worth seventy percent of my wake hours?
• 1:07:58
  Speaker 1: and it's just not saying I, like you, love, show the bag or whatever it is.
• 1:08:03
  Speaker 2: Yeah, unless you love the stuff you do, and that's great if somebody's in that.
• 1:08:06
  Speaker 2: I think a lot of people are jobs they don't like just trying to make a buck.
• 1:08:10
  Speaker 1: Yeah, I think, I think you're completely right.
• 1:08:12
  Speaker 1: I think this kind of whether it's keeping up with the jones or some sort of insecurity.
• 1:08:16
  Speaker 1: You know you want to buy branded shit.
• 1:08:17
  Speaker 1: Like I walk past, like you know, hong kong is full of luxury stores, right.
• 1:08:22
  Speaker 1: So the queues outside the ms and the chanel shows in the dual stores and stuff, I just think I look at those people.
• 1:08:29
  Speaker 1: I feel really sorry for them because there is obviously something so Deeply insecure or missing in them that they're willing to stand outside a shop so they let them in, so they can hand over their hard earned money, right.
• 1:08:40
  Speaker 1: And I think like, okay, from a marketing point of view, I want to buy those shares because those companies have got a fricking figured out lvmh and those guys.
• 1:08:50
  Speaker 1: I mean it's amazing business.
• 1:08:51
  Speaker 1: But from a from a human being point of view, I'm just like what is it that's missing in those people to do that?
• 1:08:59
  Speaker 1: Because you know, you see what you watch, instagram or something.
• 1:09:03
  Speaker 1: I watch the video the other day and it was some guy, really cool cage, and he said if you make a hundred thousand dollars a year, this is the watch for you.
• 1:09:09
  Speaker 1: The watch was twenty five thousand dollars, right.
• 1:09:11
  Speaker 1: And then if you make two hundred thousand dollars you should buy the seventy thousand dollar watch.
• 1:09:15
  Speaker 1: Insane, that's pre tax income.
• 1:09:18
  Speaker 1: You're gonna give half of your post tax income basically over to buy a watch.
• 1:09:21
  Speaker 1: What the fuck?
• 1:09:22
  Speaker 1: yeah, yeah, watch this have like a look at the margins of watch companies.
• 1:09:28
  Speaker 1: right, it's a three or four, five times markup On that you are you just giving you know the lvmh billionaire more money.
• 1:09:39
  Speaker 1: Like what's the logic with this?
• 1:09:41
  Speaker 1: And the only way I think people really get out of that is if they start to understand the value of money.
• 1:09:46
  Speaker 1: Like I remember, years ago I read a book really dull book on compounding and I just remember like that really sank in and I thought if I cancel netflix, which was ten dollars, then in thirty years it'll be ten thousand dollars.
• 1:10:01
  Speaker 2: Yeah, you know it that I'm crazy thing with investing.
• 1:10:04
  Speaker 1: it really is, and it makes you appreciate the little things.
• 1:10:07
  Speaker 1: Like I have a TV, I literally have netflix because I just not because I'm cheap, but I actually don't like the how it impolutes your mind.
• 1:10:14
  Speaker 1: But I with everything that you don't really value, it becomes so much money and it doesn't mean you should live like a monk and in a basement in the dark.
• 1:10:22
  Speaker 1: We should enjoy life.
• 1:10:23
  Speaker 1: But I think a lot of people just waste so much effort on stuff that they don't really doesn't really make him happy.
• 1:10:30
  Speaker 1: But if you're in a job you hate, you want to buy something to make yourself feel better, and that's a lot of marketing based on right.
• 1:10:37
  Speaker 1: Starbucks is the greatest example.
• 1:10:38
  Speaker 1: Right, you're paying what?
• 1:10:41
  Speaker 1: What's the Starbucks margin?
• 1:10:42
  Speaker 1: What's?
• 1:10:42
  Speaker 1: What's a cup of coffee cost to?
• 1:10:43
  Speaker 2: make like five dollars in the margin is like eighty or ninety percent.
• 1:10:46
  Speaker 2: It's a crazy amount of money.
• 1:10:48
  Speaker 1: Yeah, it's a great business and you do that because it makes you feel a little bit special in that moment, but you do that every single day.
• 1:10:56
  Speaker 1: I think the average Starbucks user spend something like three thousand dollars a year on Starbucks.
• 1:11:02
  Speaker 2: Crazy.
• 1:11:02
  Speaker 2: And then they, and then they'll buy like gift cards and have balances with them to, and so Starbucks is like a bank.
• 1:11:08
  Speaker 2: It's, it's not like and again it's just like you said it's to provide like a dopamine hit of temporary gratification because life sucks, yeah, and I get it and I lived it totally.
• 1:11:19
  Speaker 2: Or I wish I wouldn't have figured out in my forties who like, like I need a break from this.
• 1:11:26
  Speaker 2: I wish I would have done it much earlier.
• 1:11:28
  Speaker 2: But you know, you can't go backwards, you can only go forward.
• 1:11:31
  Speaker 2: So I'm happy to be here, because there's a lot of people that never make it so.
• 1:11:34
  Speaker 2: So I know.
• 1:11:36
  Speaker 1: I mean, I got a lot of people who like contact us on the like seventy eight, they just figuring it out and it's it's still brilliant because they're still alive and they can still enjoy themselves.
• 1:11:46
  Speaker 1: But yeah, the sooner you get started I think that's the thing, like people just put it off because they're busy life gets in the way it always will, it always does, and you need to just like have that really, really hard goal of being financially free and figuring it out and, unfortunately, you gotta figure it out on your own.
• 1:12:05
  Speaker 1: I mean, social media is brilliant for, but no one's really gonna do it for you.
• 1:12:09
  Speaker 1: So you just gotta make that plan and don't accept the life that maybe your parents lived and not everybody around you is living, like my family things.
• 1:12:21
  Speaker 1: Think I'm a, I'm a, I'm a freak shirt, right?
• 1:12:22
  Speaker 1: They think I'm a really weird, weird guy Because I don't conform with their expectations of you know what that good job and you know all that kind of stuff.
• 1:12:31
  Speaker 1: Retire when you're sixty, five or something, because I don't think that's what life should be about.
• 1:12:36
  Speaker 2: No, Well in, the thing is like compounding results don't just happen with money, they happen from success, like with its success in life, to if you put like a couple of hours a week initially towards trying to figure out how to be financially wealthier over and then maybe read a book, yeah, once every couple of months or whatever set really low goals To educate yourself and to learn and then just put money in and invest.
• 1:13:04
  Speaker 2: If it's a small amount, who cares?
• 1:13:06
  Speaker 2: Lose it?
• 1:13:07
  Speaker 2: Learn like learn from other people if you can, but if you gotta learn the hard way to do it with small amounts, start dollar cost averaging in and learn what kind of investor you are and how to dollars into it every week, or something like exactly.
• 1:13:20
  Speaker 2: just get started, yeah, and you figure out and you won't lose all the gratification that you would have gotten from the Starbucks coffees.
• 1:13:28
  Speaker 2: You'll be fine.
• 1:13:29
  Speaker 1: Exactly, I totally agree with you.
• 1:13:31
  Speaker 1: We've got a bunch of free courses and stuff as well.
• 1:13:33
  Speaker 1: If you want to check out my website, go to go to academy dot org or just look at my yeah, probably need to do that too.
• 1:13:38
  Speaker 1: It'll be somewhere.
• 1:13:40
  Speaker 1: I think you're probably okay, jesse, but you know, people are getting you want to get started.
• 1:13:44
  Speaker 1: We do that.
• 1:13:45
  Speaker 1: We also have free programs for for veterans, because they get particularly screwed and targeted by the nasty financial industry.
• 1:13:52
  Speaker 1: So but yeah, you just gotta start somewhere and just just dig in and ask questions and you know you'll get better.
• 1:13:57
  Speaker 1: Yeah, just like, really really enjoyed this chat.
• 1:14:02
  Speaker 1: I'd love to do this more often and I'd love for you to convert me into a bitcoin or a crypto fan.
• 1:14:07
  Speaker 1: So I think there is I'd love to do it.
• 1:14:10
  Speaker 2: I eat a lot of fun for me.
• 1:14:11
  Speaker 2: I've been in this for about seven and a half years, so I've been this my third cycle, so I'll be happy to do that and I love the chat again.
• 1:14:17
  Speaker 2: Man, you're cool.
• 1:14:18
  Speaker 1: Yeah, let's, let's, let's do that again and we'll, we'll, we'll.
• 1:14:21
  Speaker 1: People want to want to hear out here that let us know in the chat.
• 1:14:24
  Speaker 1: Do you want to hear this talk about crypto?
• 1:14:26
  Speaker 1: Get a crypto fan to convince an old banker who knows very little about it, if you can achieve that I'd probably convince everybody, I'll be indoctrinated and like the doctrina session for Felix one hour, see what happens.
• 1:14:41
  Speaker 1: But no, jesse, absolute pleasure.
• 1:14:43
  Speaker 1: Thanks so much for your insight and obviously we digress a little of people here, I think.
• 1:14:48
  Speaker 1: I think people didn't mind.
• 1:14:50
  Speaker 1: I can see from the chat here.
• 1:14:51
  Speaker 1: Thanks guys for tuning in.
• 1:14:51
  Speaker 1: If you are tuning in from from my channel, give jesse a follow, micro to macro, with a zero at the end, just to make it more interesting, and particularly follow his twitter as well.
• 1:15:04
  Speaker 2: it's brilliant and same goes for you, felix.
• 1:15:06
  Speaker 2: I'll shoot the second one next year.
• 1:15:10
  Speaker 1: Let's do this again sometime.
• 1:15:11
  Speaker 1: All right, sounds good bud.