The Data Is Screaming Two-Speed Economy | Weekly Roundup

We're words beginning where politics is going to sit front and center in social class warfare. As AI has is more productive and you're in this productivity boom in certain parts of the market, like the social contract becomes a problem. For the most part, main street real economy has been in a recession since mid 2024. It's winners and losers. I mean, the Trump is hand picking winners and losers. If we do get these hundred base points of cuts in four months, I just don't see how inflation doesn't come back. It's a fiscal super cycle, bro. Get out. Get out the bedwags. This episode is brought to you by VanX semiconductor ETFs. You'll hear more about the VanX semiconductor ETF, ticker SMH, the largest semiconductor ETF, and it's newer VanX Fabless semiconductor ETF, ticker SMHX later in the show. Blockwork's digital asset summit, crypto's premier institutional event, is back in London this October 13th to 15th. You've got top speakers from BlackRock, Circle, Coinbase, the UK Parliament, and Athena, all under one roof. I'll be there as well, hosting a live forward guidance episode with Quinn and a few others. So if you want to see us record in the flesh or meet some of the other legends of the Ford guidance community, this is your shot. Notable macro names like Michael Howell of Cross Board of Capital, a Jeff Park are already confirmed with more coming, there's also a VIP dinner on the 13th that will sell out fast. That's for speakers and VIP ticket holders only. It's not old Billings gate in London, use code Ford 100 for 100 pounds off. See you then. Good afternoon. This is the Ford guide. I'm redoed. I'm redoed. What does he say? What does he say? He goes, I'm Felix. I'm ladies, gentlemen. It's me Felix. Welcome to the comedy hour. We'll put that in Tyler Tyler's introduction. Welcome everybody. I'm Felix Jolveen. And this is our clients. I'm Felix. I'm 66 Canadian Lumberjack. I like to call talk about macro and crypto, welcome to Ford guidance. So as you can tell, the inmates have once again taken over the asylum. Tyler and I are running the show today. Felix is out this week. You'll be back next week. We're recording this on Wednesday the 10th just after the close. So we got PPI today and then we have CPI tomorrow and pretty, pretty eventful time. So we'll jump right in. We would like to mention the digital asset summit in London is next month in October 13th and 15th. If you haven't got your tickets, you should. So I did my I did my show. Great plug. We used enthusiastic plug ever. Have a lot to cover today. Inflation data this week. Obviously we got some interesting labor data. Always interesting things going on with the Fed. Some AI CapEx tariffs and then we'll get into some market views. So I figured out of the jump here, we can just go over quickly the PPI data that came in this morning. It came in light. I don't know how much there's to read into it. There was some different different takes around it. I think that last last month was plus point nine month over month. So so you know, could just be evening out. You obviously had Trump still once again calling on on Paul the cut. And I thought this Tyler, this chart was interesting that someone was looking at the input costs component of an intermediate side of the PPI and basically pointing to this idea that there's actually still price pressures building presumably from tariffs. And we're starting to see a lot more headlines. I think around corporates maybe not not being able to pass through the cost as much which would be sort of an indictment on their profit margins really. And then the last one I had which was sort of interesting I found as well. Basically showing all the Federal Reserve Bank surveys and all these other like soft data measures of prices paid and then you have the PPI. So I'm sure this will get all the conspires conspirators. Yeah, you know what's interesting to me is like I'm I'm just going to fade the the inflation hype here and just say if you look at all the market indicators of forward pricing, the inflation is not showing up like it did the last PPI and I think that's why we saw the market reaction today where everything you know the VIX rolled over there's no big inflation scare or anything like that. So I don't know I'm kind of a fader of the inflation narrative it feels like everyone on their mom is calling for like this scary inflation spike and you know I'm not seeing it in the market indicators I look at like if you check out this is this is incredible slide 41 if you can pull that up this is the two-year inflation break even and it's actually collapsed you can see it fall from you know 280 to 64 now and if you zoom out this is the the second chart on the right you can kind of just see we've kind of been in this range of two and a half three percent and there hasn't really you know besides a few moments of of brief spikes it's largely been faded and then if you go you know if you go to the next chart this is even more fascinating so this is uh the risk parity ETF this is almost breaking out to the upside here and if inflation was really you know that bad you would see you know risk risk parity funds not working like this so I don't know I'm a fader of the the super high you know inflation spike narrative here in fact you know and I could go to two more charts that are kind of compelling if for CPI tomorrow is chart 44 this is new tenant rent is is troubling so we're actually seeing a large component of you know that that owners adjusted with owners equivalent rent I'm guessing that's going to come in lower given the housing situation um you know commodity inflation is is also rolling rolling lower so really it's only the transitory transitory tariff stuff the inflation data that we have to worry about which is why I think they moved you know they move the goalposts to more of the employment side of the the mandate at the Fed um but yeah to to your point there's there's stuff that's concerning but if you look at the market indicators it's actually not showing like high yield we could go through a whole bond slide show like in in a couple minutes but I'm not seeing even though all those indicators are turning up the inflow into bonds is not showing that anyone is really concerned on the debt side of things yeah I did find that interesting how the bond market and equity market do appear to be somewhat diverging here where the bond market is you know not that concerned with inflation and if anything you'd argue growth concerns but then you obviously have equities kind of still just chugging along I would say it feels to me the sentiment is is turning a bit more towards the the belief that corporates aren't able to pass prices on and their margins are getting squeezed and inflation is less of a problem I mean it's relative right because it felt like PPI this morning was celebrated as if it was 0.6 percent but it was 2.6 percent headline so like it's just clear the Fed is prioritizing labor over inflation so I guess at these levels they cause I have hit their target based on how they're acting I guess you know it to your point I'll just run through these now because it's kind of wild to see but if you go to like slide 38 you'll love these as an ex bond guy so this is high yield spread to worst and high yield yield to worst so the yield to worst is the on the left side it's the blue line and the spread to worst is on the right side it's the red line so you can kind of see high yield bond is is yielding I think it's you know 6.9 percent which is wild in a world where inflation is kind of turning up so you're still getting the inflows into the the lowest credit bonds in the market a lot of structural reasons why and then if you look at the spreads which is you know when spreads blow out that's really when you got to be concerned that there's some sort of credit problem in the riskiest parts of the market and we're not seeing that at all and then if you go go to the next chart this is if you look at the thousand basis point universe of high yield bonds it's actually contracted to a six a month low so this is why the market is just keeps grinding up here is the cost of capital is dropping for the worst companies in the market and you can issue you don't you can you can issue on the debt side of things you don't have to dilute your equity so everyone's surprised of all these squeezes and especially in a lot of the AI you have this jumping catalyst because also look like look at I'm not allowed to mention single stocks but like something that runs with Schmorkl be earnings massively like in non-volved and it at all but like you know it's a big macro story and so that gives like wildfire to all the everything underneath in this this big macro story so you know in in the on the debt side of things you can really finance these deals I read you know I think I put it out on Twitter but you used to be able to finance a data center for like if you put 65 to 75% down loan to value now it's 90% down loan to value this is from the information which means you you don't have to find an equity you find less and less equity you can just finance with debt and that's what causes all these short squeezes which is you know largely risk is finding the frontiers that's that's the bottom line is that's the market action and then just go to the next chart this is just one of my favorite ones to show this is from JP Morgan best work JP Morgan got to give him thumbs up first much as I you know hate on you know a lot large cap bags but this is really good stuff so they're they're high yield spreads are currently you know 328 but if you look at the recession during a recession the average spread on high yield is 971 basis points so all these figures and you know calling for a recession it's like not remotely the world we're living in right now spreads are so low and you know once you get spreads blowing out that's when I'm said I'll be concerned there's some sort of recession but right now it's it's still game on and not only that but then then if you look at the FedFunch futures yesterday there was an 8% chance of a 50 basis points cut next week now I think there is like a 13% chance of a 50 Bips cut so we're actually like yeah there you go and this is saying 11% chance but I think at some point this today it was 13 and if you actually look at you on Bloomberg too yeah I love it it's the best but then if you look out like all year long you know to January you know there's three three cuts priced in so we're in a liquidity you know everyone's saying oh watch out you know there's there's super credit problems this is not what the market the internals are actually telling you I was looking at this chart today this table today and my my view going into inflation prints this week is that it's sort of it's sort of a nothingburger because how does how does the rate cut path get more dovish than this and my takeaway is I think it's fair largely to declare victory for Trump and his war against the Fed I think we have one of the message I wrote was you know Stephen Stephen Moran is you know the the White House economic directors becoming a fed board governor member this week and you have to own gold yeah I think it like yeah the situation I mean so you look at the amount of cuts price in we're talking you know three by December January and four by March April I mean this is basically victory for Trump over his take Fed takeover effectively I mean you know Fed estimates of neutral are you know that puts us probably even on the low end of neutral you know relatively speaking I guess my bigger concern is what it gets so frothy that you need more and more easing like at some point it's going to get overcooked I don't think we're there yet but like you're starting to feel a little a little bubbly well I just think inflation is is going to come back I mean I just don't see how it doesn't it feels very similar to last year when the Fed just ramped up the cuts and and you still have fiscal deficits running x at 6% and then you throw on a hundred base points of cuts to lower the cost of capital for small businesses private equity businesses you know how do you not get how do you not get stimulus breakthroughs begin with semiconductors with over 23 billion dollars in assets under management the van x semiconductor ETF ticker smh is not only the largest semiconductor ETF but it has also outperformed the next largest semiconductor ETF it is built on an intelligently designed and constrained index that includes the whole sector stack from design to manufacturing historically this unique construction and methodology have helped smh outperformed its closest ETF competitor check out the table below go to van x dot com slash smh phelix to learn more as always investments and blocking technology involved risk terms and conditions apply do your own research let me play devil's advocate that what if that is disinflationary like what if what if you lower the cost of capital in every you know fracking person digs up whatever the oil they can with with debt like I think that's largely what we saw with pretty much every commodity industry during during that time is like it makes it really profitable to use that to go dig up whatever so there's a surplus of commodities that keeps the lid on that stuff I just don't think you see any of the money going to these things I mean we get rate cuts and it's more yolo call buying an AI and and everything else I don't think it's look at housing though housing you might get some more sort of supply bill there's going to be an equilibrium of buyers and sellers eventually I don't know I think we're each market has a different supply and exactly so it's very asset selection is super critical here yeah it's winners and losers I mean the trump is hand picking winners and losers in the governments kind of the only the crowding out effect is becoming very apparent I think yeah I you know I say markets markets are a political utility it's feeling more and more like that now yeah I think it's a good transition so into into some of the labor data we got we had this benchmark revisions that shocked a lot of people it was it was probably on the high end of most estimates I think Bloomberg's estimate was 500 to 900k thousand less jobs reported in the in the year through March 2025 so this number is it's very very delayed right so this is April 24 to March 25 so this is basically pre-Trump immigration crackdown pre tariffs predominantly Biden Biden's economy as Trump would say but the numbers massive if you look here you know last year we had 818000 there's clear the data there's some serious to there's a there's a bipartisan just like travel with data it's a classic Trump thing where Trump is able to latch on to something that has truth and use it to his advantage which everybody can agree this data is just completely like ridiculously bad yeah and then for eight four years ago to revise the other one yeah so it's it's crazy it's the biggest revision since since 2009 which basically you know obviously we all know what happened there and the crazy thing to me is this chart on the left that shows for the most part main street real economy has been in a recession since mid 2024 I mean growing in many months negative month of month job growth so I think that sort of puts puts you know brings the elephant into the forefront in the room that everybody has known has been there the two speed economy two speed these charts show bisector where the revisions have been it's a lot of trade manufacturing retail and I think this starting to get into some slightly different data that we got this week but one of these was workers expectations of job finding split by income cohort so under 50k income we're seeing some of the worst numbers since gfc you know and then it's marginally better for 50k to 50 to 100k and over 100k so just shows kind of like the continue rising wedge in in employment and equality this is that same data showing you know the job finding risk and really highlights the stasis that our economy is in you know we're not seeing unemployment rate spike and we're not seeing layoff spike but we're seeing hiring kind of come to a grinding halt and and the big one we've mentioned a lot is this youth unemployment which is just going to increasingly become prime problematic as you know it starts to become generational you know specific I think you think you start to get a lot of social problems maybe we're seeing already when you leave full full generations behind and at the same time you have you have this this came out the percentage of older Americans who are departing the workforce early 55 plus labor force participation rate just keeps plummeting basically saying their house values and their equity values and their retirements are our skyrocketing so they have to work less and they've they've achieved their goals so I think a lot a lot there but what did you make of you know all this different job market data this week Tyler well I mean yeah I just can't stop thinking about that you know the situational awareness piece by Leopold Ashburner is like he talks about in it it's like this 80-piece treatise and I got to give these guys I think the most credit they've nailed the macro better than anyone and the and the micro I mean just clear they're they're the winners and all this but they talk about how you know as AI has is more productive and you're in this productivity boom in certain parts of the market like the social contract becomes a problem and maybe what we're seeing is is policy changing from you know as it affects the the lower income and more commoditized types of the employment you don't need to employ them as much and so what you really do need to do is do innovation then and create new things which is I think why the policies is gearing more towards the employment on the lower tier and we're seeing like credit card charge offs are at highs like it's it's clearly the financing costs of running the economy for the lower income in middle income tiers is getting harder and harder and I think it's also even worse because like the employment numbers for those types of positions you know they're the first to get cut and and so I think that's why the feds lowering rates here but check check this out too this is I think to talk big picture on on what's going to change here is go to slide 37 I think it's the small cap earnings if you can pull that up so small cap earnings peaked in 2022 and decline nearly 20 20 percent and now they look to be stabilizing so as you know these fed the fed liquidity and this liquidity cycle picks up and you're actually pointing to bailing out like that two speed economy you had you know the fangs etc and now the smaller caps stocks are actually picking up an EPS as capital costs kind of drop here and I that rotation we've seen you know a couple weeks ago or a month ago we talked about the net short and I WM and now we're seeing the rotation kind of out of some of those super large caps into the smaller caps as the capital costs drop on you know the from from the Fed so my whole point in this is that you need more you know maybe this is like UBI in a way where you need to like really drop capital costs create maybe some non productive you know futuristic type jobs so that our economy isn't just this two speed dystopia I think you need to basically force nominal growth if that makes sense you know and that's this is the world we live in now is like you you can be so productive in in some parts of the economy that you don't need you know manual labor or what at whatever it is in a lot of senses robotics is is turning up there's we're having a productivity boom but it's also disguised by like a lot of inflationary you know weird political problems so it's it's a hard macro to navigate but I don't know I think the situation where this guy is absolutely nailed I think we're worth beginning where politics is gonna sit front and center in in social class warfare in in this is probably really heart horrible to bring up but you know Charlie Charlie Kirk just got shot at one of his events and like we're seeing how broken down are you know when when guys start getting shot political political figures political violence happens it's really a sign that there's there's a lot of messed up imbalances in society so where where where you want to go with that yeah I mean I think maybe bringing it back to the labor data that that came out this week um yeah sorry I went down to I mean at all at all I think we agree it you know fits in there um to me the biggest takeaway is that you you have basically agreement that main streets in a recession and you know job growth outside of government and healthcare sectors is is effectively negative in many cases yet policy continues to be you know wealthy favoring tech favoring AI favoring and so I think that's a big reason for for the unrest and in continuing you know social bubbling of these social problems and the fabric um and what it is to me is is the crowding out effect in fiscal dominance you know sort of slapping you in the face because the government is committed to the six plus percent fiscal deficit annually so that sort of puts a floor on nominal growth and nominal growth can appear in real GDP or inflation it to me tells says that sort of the only way to fix this is to bring government spending down because there's no free lunch in that crowding out uh crowding out effect where the government is growing but private sector isn't uh it to me is is the fiscal dominance and sort of also the definition of stake flation though because we're seeing we're seeing the labor market not grow at all and just is at the standstill but we're seeing inflation too and it's just like people have different definitions and there's you know bulls hate when you bring up stake flation but it just feels very very like the definition of stake flation is the labor market is not growing and you have inflation that's I guess where people argue if it's problematic or not where it's at but when you stimulate to reignite things whether that's via cuts or other liquidity mechanisms uh you you I don't know how you don't bring inflation back we have a falling labor force so you're constraining supply and if you do reheat the economy and main street starts to do well again like you have to have inflation like the the people that consume and demand based commodities oil energy power have been in a recession for a year and a half and we still have an inflation problem the rich don't consume goods and services inflation so it's this we're sort of becoming ever closer in my opinion to the push comes a shove type of rock and hard place because if we do get these hundred base points of cuts in four months I like you said I mean that's bullish for people's you know everything wealth effect I just don't see how inflation doesn't come back yeah I guess the hope would be you know productivity grows and you start growing new industries that you know would compensate you more and we just go up higher than inflation like right now this is kind of interesting one of one of the guys he does infranomics on Twitter he does incredible work and he was talking about he was talking about Japan and Japan is they're finally growing their wages more than inflation so it's actually like you know it's working for labor that doesn't mean you know that that interest rates we should theoretically keep rising there but rising in a manner where like the growth actually sustains the debt so maybe that's where where we're headed is you actually grow the pie you have rising wages inflation stays lower in in the pie grows instead of you know stealing pies from the different cross sections of the economy using a similar philosophy to SMH the Vanneck Fabless semiconductor ETF ticker SMHX goes even deeper exclusively investing in Fabless semiconductor innovators designing AI infrastructure behind the scenes we're talking high bandwidth memory power management chips custom accelerators and ultra-fast interconnects the critical components that make large AI models run faster smarter and more efficiently go to vanneck.com/SNHX Felix to learn more as always investments and blockchain technology involve risk terms and conditions apply do your own research. Yeah I mean it'll be interesting I mean I Japan yeah ground zero or monetary experiments yeah your gold book seems to be doing fine yeah it's bring it out I mean Japan you know they just got their new they they had the the resignation it sounds like everyone that's involved there is ready and willing to spend more Europe it's I just yeah it seems like it's a fiscal super cycle bro get out you know the bedwags yeah it seems like oh all great news for for the gold do you have uh in Middle East bubbling up drones flying into NATO like I don't I don't every day you wake up there's like five headlines that's a good reason to buy gold the VIX is still like 15 yeah market structure is operating perfectly right dude check this out actually hit slide I think it's fine slide 47 it's S&P implied volatility versus realize ball this is from our my friends at Piper so this is uh yeah this is fantastic so heading in a CPI tomorrow you can see like there's a 60 bips this is tiny by the way this is 60 bips implied move on the CPI release tomorrow so obviously everyone buys protection out of it and if you look at the next three days there's only implying you know a 48 47 45 basis point move but if this is even more crazy is so obviously like if you look at the blue line relative to the the orange line the implied is is what implied volatility in the future is whereas the orange line realized all tillies in the past and generally speaking like you know when that orange line is below the blue line the blue line will come down more so theoretically you know the the implied moves of the S&P is going to get smaller and smaller unless there's some sort of event but you know there's not really you know it's looking out the 17th is the next big event in only a 74 basis point move on the S&C so it's these events it's just kind of wild these structural like volatility overlays and you know just kind of interesting we've done a lot of work at money waters on on these market structure phenomenons and they're so much more powerful than you could possibly imagine isn't it better for for risk if implied vol is high and you make it through those days with no no downside and then you get the vol crush like if if implied vol is super low that means people aren't reaching for protection very much and so yeah but it's relative to realize fall right so it's like you know you're realized you still go low you're saying basically exactly like realizes that you know third right it looks this like this orange line is lower than like Jan Feb even yeah so even though implied looks low the the move beneath the surface is even lower but that's the problem is it's like we're in this as long as capital costs drop the volatility that's where you generate a lot of the yield and so you know that we we we this is why the flows of the market matter like way more than the fundamentals in a lot of senses and it's a it doesn't change like you could have all this geopolitical stuff but all the systematic investors will do the same thing regardless it's kind of wild that is I mean it reminds me a lot of 2017 Trump's first year of his other term when the markets were like a straight line up all year because he just it's almost as if he knows this ballgame and just it's like he announced this not that bad he retracts it and ball falls he you know it's just like he's an AI for like four guidance it really is it sounds stupid but like he already is anticipating the narratives that other people will use against him and he kind of sets up the market for it for the event and it's it's brilliant it's easy he's a PR guy he's always been a PR guy he's always on the next cool social thing and like since the 90s he's been going to boxing matches now he goes to UFC matches like he is a human AI of forward guidance which is why like he he's always one step ahead with with you know stocks it's really incredible watching you know he might have some saying things now as president oh yes clearly I was just saying like he has this he say what you want about the guy he has like a superhuman quality of anticipating things in a lot of senses even though he comes across as morons sometimes yeah people don't like his his approach but but yeah look at this this chart is crazy contribution to GDP from software computers per folk women data centers so AI basically this is like without this we're in a recession I mean well yeah we are I mean everybody except for the like 100,000 AI employees in the country are in a recession basically here's another good one big tight capex growth in the billions so 2025 over 400 and we're we're projecting over 526 this is construction spending split out by everything and then data centers so it's basically showing just the recession you know from from 2024 on except data center growing to like partially offset yeah we have you know output versus employment where the blue line is you know your output skyrocketing employment falling and I guess this is you know AI productivity and in some senses at work the question I have like this chart so Tyler you're big you know you talk a lot about how the buybacks are so important you know such a big driver for this market we've we've had staggering numbers you know kind of year-over-year particularly from the max seven I was reading somewhere how how that has sort of fallen or at least slowed the growth in buybacks and I and I see this chart and I'm like how do the largest stock repurchasers in the market who make up you know 30 whatever plus percent of of the S&P who are also ramping capex you know 20% growth year-over-year on on AI spend how do they also do this while maintaining that breakneck buyback pace well this is this is the 64 million dollar question is I think they still are increasing buybacks by the way I think it's a trillion dollar run rate maybe 1.2 or something per year however like they're seeing an opportunity to grow their businesses and I think to my earlier point about the debt is like on a lot of this data center growth you can now go to because the the debt financing costs are so small people will lend them 90% loans to 10% of the value so they only have to put up 10% equity to build these things and therein lies you know how these numbers can get so large like with debt capex cycles it's jensen was talking about like a multi trillion dollar like a trillion dollar spend in 2026 27 so this these numbers could be actually below estimate the the point and the but you have to keep in mind that like this could be complete horseshit and they never come to fruition in open ii never hits revenue and you know that or they never get that next round of like VC financing or what you have to watch these things when they start falling apart because there will be bodies there will be blood and right now there's not i mean we're seeing we're seeing like companies report huge large cap companies report and go up 30% and there's something there i mean for for now so let's well you have to watch it but yeah i agree if you don't this this debt will crush these companies in like 10 years if it doesn't come to fruition or whatever you know when you see those large cap ex-booms it's really it's really the narrative can really be self and reinforcing whether or not it comes to reality is you know that's the million dollar question yeah i mean it reminds me also like you mentioned earlier the the shale boom i mean this is exactly what you you have a you have a gold mine and a race for profits until profitability gets competed down to zero and then you have everybody on the hook for tens and hundreds of billions of catbacks like you want to see when the fangs actually stop going up it's it's if they're there's there's one winner and all this stuff then then they'll all tank because the catbacks is so huge but they do have the cow a lot of the cash load to pay for it that's the wild part it is wild uh the other thing i the other thought i've been thinking about is another food for thought i want to pose is Nvidia has 36,000 employees and a 4.3 trillion dollar market cap they represent you know whatever it is close to 10% of you know the s&p 500 or NASDAQ whatever and their market cap alone for those 35,000 employees is you know another 10 or 20% away from being larger than the niki nike 225 which is the second largest stock index in the world in japan raging success raging failure you know home run you know these numbers these catbacks numbers i show continue or not from a concentration perspective where does the next marginal dollar for Nvidia come from like who who has room to buy this thing like it did 401k is bro it's is that sort of a mind-boggling like concept well that's literally 35,000 employees what kind of tech dystopia are we in here i will say it's a testament to capitalism like he made jensen made so many people rich like you know even if you were there multi-million dollar multi-millionaires if you just work there for 10 years it's it's awesome it's really incredible but to your point on the size like i don't know i just saw like a you know a hundred billion dollar company go by up by 30% one day so like the this wild stuff man where maybe this is the 21st century industrial revolution like those those guys would argue for it um that this is that's what we're dealing with here and maybe we can't quantify it like normal human growth i think that's what makes this so tricky because every scenario i play forward is so unbelievably reflexive both to the upside and downside there's there's no middle ground yes either it's either it's either things are fine Involve flows, CTA flows, pension flows, 401k flows, just 20 bips a day. We just drift up until Nvidia is the size of the whole global stock market, XUS, or you have prices start to fall. CapEx comes down. They can't pay their employees in this inflated monopoly money stock anymore. And then employees start selling the repurchases and job losses proliferate, less 401k flows, the boomers retire, less, you know, more cashing, like, it's starting, I kind of, I agree with you all that, like that reality, but do you actually think the government is going to let that happen? Exactly. That goes back to Ponzi. It's 39 minutes in and I said it. That's the crazy thing that goes to your point about, it's like that meme of like the one guy holding the world and like people have been saying Nvidia there, but it's like, you find the crack in the market, like the existential risk in the market is how I sort of feel. And in 2023, that was CRE, right, commercial real estate. When that blew up in March, they stepped in, you know, it feels to me like it's now sort of this concentration risk, which is more of a, people always get confused when you're like bearish. And it's like, well, that can be like financial markets and the economy are most separated that they've ever been. And so to me, when you, when you look at this issue, it's like, yes, we know that they're not going to let, you know, the 10, the stock that makes 10% of the index, you know, in everybody's retirement account, lose 50% of its value, you know, in a couple months or whatever. But as, but the, but the longer they don't let it, you know, a controlled burn occur, the bigger this becomes, right, if they would have let the bubble deflate years ago or along this way, you know, it's a $1 trillion problem, and it's a $2 trillion problem. Then it's a huge, now it's a four and a half, five trillion, so it's like, your stimulus to fix it also continues to ramp as you kick the can. And that's what's most fascinating to me because we're getting into numbers for, for these types of, again, this is like every time I have numbers, so they're essential, but every time I have a conversation about anything, I just can't, I just stopped like halfway through and I'm like, I need to go buy more gold because you, you have gold that central banks are acquiring, that's the fiat debatement plug, that's the global chaos plug, all these things. And its market cap is, let's say, 20 trillion or whatever gold is and say 80% of the supplies held by central banks or, you know, you know, vaults that is aren't moving, so the circulating supply is actually much less. So then you're looking at it and you're like, okay, the problem is not $1 trillion anymore, it's a $4 trillion market cap problem, then it's a five trillion, and then you're looking at gold and you're like, wait a second, they're going to have to print, you know, and COVID they printed $4 trillion. The next crisis, they probably have to print $8, and then you're like, wait, the circulating supply of gold is not keeping up with that. The circulating supply of the fiat debatement had chance to keep up with that. Like, the numbers just start, like, it's, it's, it's, it's crazy, yeah. You know what else I'll say too, is like, China gets a lot of heat over, they move their productive capacity to the economy. First it was like, they put it into real estate, and then they had their real estate boom. Then they put it into tech companies, and then they put it into the manufacturing capacity. And you know, similarly, let's just want to show this last chart, this is interesting. Go to slide 48, this is the data center versus office construction. It's tangential to what you were talking about before, but like, this is, you know, we're watching our economy move from like, oh, we're no longer a commercial real estate driven office economy, all right? That, and now we're making up with it with like data centers. And so a lot of sense is, you know, we, we talk about like markets are a political utility or centrally planned. This is a centralization thing where it's like, you're pointing giant fiscal bazookas at different things, space, boom, you know, whatever it is. And that's just the new wave of things in, in that world, theoretically, like think about this, what the premise of investing, diversified, diversified investing in our 401Ks, it's kind of ridiculous. Like if you go under the hood of this, I just got, I got to roast the entire 401K system, but like, you can't really choose what you want. You can't be like, all right, I want, I don't want any exposure to commercial real estate, you probably have some, you know, if you buy a bond fund, you're buying a lot of the times you're buying some weird like Austrian hundred year bond, you didn't even realize you're buying that, right? But like, things are going to be way more concentrated going forward and way more driven in a world where you need nominal growth to basically pay off the debts like you said, right? The wide diversified nature of things that shouldn't theoretically work before and not to tune our own horn, but we internally and money wires, they started this product that basically has hacked the flow system of, and they've been, they've been running it internally for a year and it's got like renaissance like returns. It's absolutely mind-boggling, you know, basically just following the flows, concentrated flows of the market rather than, you know, doing this diversification. Just taking advantage of, you know, a lot of the flow system and I don't know, I think as investors, we have to be cognizant that maybe the way things were built 30, 40 years ago aren't necessarily like working anymore and it fits fully into the fourth turn into first turning, you know, framework of new institutions get built and the old institutions that were funneling this slop to you, you realize how bogus it is and a lot of tits is, but yes, I'm sorry, I had to plug that because it's very fitting for what we're talking about. This chart is madness, it makes sense that kind of following 2023 office cat-bex construction would be declining, particularly talking about all these, the Metro, one the metros are going to like, just going down the garbage and two, you know, the work from home plus, you know, you've been showing about CRE. How many reads were just in, you know, some giant slop fun that they offer you, you know, and you have actually, you're probably putting in this allocated dollar into that type of stuff instead of financial repression at its finest because the government mandates most what can be in 401(k)s and in these target retirements. You talk to the average person on the street, you've been every job, like I talk to people and they're asking me what should we do with, you know, investing and then they pull up their 401(k) options and it's like, the target statement retirement funds that are, you can't, and it's a financial question. Yeah, that's fine. Actually, if cartel, in that goes back to like the short volatility thesis, they're actually stifling human volatility, and they're actually, if you think about it philosophically, they're forcing you to invest in these things so that they can kind of just squeeze a little more yield out of you. And if they can implant you, if every dollar goes to where they say, you know, it should go, then, you know, think about the, think about the amount of control you have on that. And so I think that's why we're at the point where you have to have centrally planned economy where you have to push pieces of fiscal spending in certain pockets that have potentially secular growth. And so you have to rewire your brain is like, maybe over diversification isn't the answer. I'm just staying up with the crowd at that point. You have to be more concentrated and nimble on how you manage things now and it's completely generational change. I also think to your point, maybe I would approach it slightly different but agree is how I view it as just current government policy is and repeated kind of stepping in, backstopping type actions in tandem with like stated 6% budget deficits and where that budget deficit is going creates, you know, winners and losers that you can quantify, you can qualify, quantify, identify. And it is such a powerful force when your government's crowding out every private sector mainstream business and saying, mainstream, you're, you know, the biggest lie told 25 was its main streets turn. They're literally like, can't breathe. They can't, there's no hiring, you know, people are, can't keep up. And then, you know, incentivizing, yeah, incentivizing all these things. And, you know, I think that's where you come to a problem and I just like today, there's a strong bond of auction and, you know, very well received and the 10 year traded down to 4%. And I just, I get like, okay, you know, people have different time horizons, people have different risk appetites, people have, you know, all the reasons in the world we know why institutional pulls a capital by bonds, you know, but I just, it makes you want to vomit when you think about buying a 10 year piece of paper from the U.S. government. There's a lot of old people out there, man. There's a lot of old, wealthy people that need to bark their cash or where I'm telling you. But you know what? The other thing is there, it's all, it's a, it's a float constriction thing too. So you have Vanguard and BlackRock and, you know, whatever they, they constrict the floats of these things. You might be better off buying eggs than 4% 10 year paper. You literally sit on an eggs for longer. It's like, I'm with you, but it's, it's, it's wild, it's your thoughts on markets next like a couple of weeks. Let's say, I don't, don't have to get like crazy specific on like immediate term, but like, you know what's interesting to me is like, okay, September's past, all the scare of RRP past. It's the 10th, bro. Sorry, the early September asked where everyone's calling for this like outrageous, you know, sell off. And now, you know, and, and I grinned, I was a little bit concerned of a little volatility. But it's funny how, you know, market narratives can kind of shift really fast. So like, okay, no RP scare, you know, no TGA scare yet. And you know, I think, I think we, we put it around until, you know, late, late September and then you get the pension rebalancing. And I guess you get earnings, we'll, we'll get some information from earnings. But given the way things are going right now and in where bond yields are, it's really hard to fade this is, is what I try to say. And you want to be in the right pockets of, of where we're, they're seeking growth. Yeah. I think that's the, the key here is asset selection because there's a lot of sectors that better not going to do well. I'm, yeah, you go to jet, yeah, I'm less comfortable. I think, I think, I think the market has a, a weird way of punishing both sides. So you have the September Doomer's looking stupid now. And, and then I think, you know, we're, we're hitting this like little period of euphoria. So I'm, I'm still quite cautious going into, you know, the first part of Q4. But I'm long, I'm long gold and, you know, so there's, there's assets to express views. You know, things to buy that you can sort of, you know, gold and expression of this, all these liquidity dynamics we're talking about. But with the more, you know, cautious tone, whereas, you know, there's other instruments. But, you know, you don't always have to be long short. You can be cashing me other things. But yeah, it's, what makes me nervous is looking the systematic. I think what's hard is the systematic investors are fully invested. Yeah. And you see, you need like a ball event basically to like reset it. Yeah. And that's what, you know, it's probably a geopolitical thing that's going to come along. And then you, if you get the initial ball spike in the initial credit spread widening, then it's like that self reinforcing crap, which is very annoying. But it almost has nothing to do. And it usually happens around earnings, too, when they have the blackout for buybacks. And then post earnings, it starts up. So it's probably, you know, late late September, you know, as they start reporting earnings and stuff is probably a little bit nerve wracking. But if you just zoom out, then you get into a seasonally low period of all where all the holidays come and generally speaking, you know, given the, the easing path that we're on, liquidity cycle, geez, it's hard, it's hard to fade longer term. Yeah. I personally wouldn't be surprised if the economy starts to kind of, the amount of cuts priced into me is, I think the market's low to sleep at how like ridiculously dovish that is, because we've been hearing Trump rail on the Fed for so long, everyone's just numb. I think three to four cuts by January, February, March timeframe would certainly reheat the economy. Maybe not full, you know, up up in a way, go, but definitely some level of bounce and especially the value stocks, right? Yeah. You're looking at these things. Yeah. Not necessarily like, you know, super bullish fangs, but you rely on a relative basis. Those have been beaten up. Like he said, there's parts of the economy that were in some sort of recession that will get the benefit here. Good stuff, man. Well, we'll have our, our Supreme Leader back next week. I'm not too good with the slides and doing multitasking, but we made it by, hopefully. Yeah. Yeah. We have to cut out some of that nonsense. Yeah. I look at the chart, by the way, you got to get the haircut, no 90s, well, I stay in the same to you. You're, you know, maybe you need to go back to that barber because it maybe he had a future vision for you because it's really coming in nicely. He was living in the future, bro. The only problem is that I got, I got a style on my eye that like from this, what do you have? Three kids. You get shit. This shit just starts having me. I look like fucking quasi. I don't know. Well, you look good in the new digs. So yeah. Yeah. This is the whole setup. We got a whole studio here. It's amazing. Full glow up. Well, we'll have to get the update. The, you know, couple weeks and update next week how things are going. But it looks like. Yeah. Yeah. Yeah. Yeah. It's a lot to go over. We have a, we have a, a, a, a, a, a strategy of funding Vietnam waiting for you guys to roast me. Yeah. Back in them. Yeah. We're trading so much dog over here. Yeah. Yeah. It's dude, funny, funny, this is just like check out the returns of Vietnam in Mexico. Like, have you, I, I started looking more of the merging work here. They're, they're absolutely filled. And this is not our, you know, what we're doing. But like in general, you know, that if you look at emerging markets, they're absolutely on fire. Yeah. And so it's done very well, particularly, yeah, Mexico has been good. Some of the southeast. Yeah. So. All right, brother. Good stuff, man. We'll catch you on the flip side. See you.