1 00:00:02,720 --> 00:00:07,240 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:11,240 --> 00:00:13,320 Speaker 2: H Matt, it's nice to be back in studio with you. 3 00:00:14,560 --> 00:00:19,040 Speaker 1: Yeah, we've we've we've each had a series of adventures. Yeah, 4 00:00:19,079 --> 00:00:22,079 Speaker 1: the car crashed into my house. You went to Ireland's insane. 5 00:00:22,200 --> 00:00:23,680 Speaker 2: Those two events are not related. 6 00:00:23,840 --> 00:00:25,400 Speaker 1: No, it would be rader they were. 7 00:00:25,480 --> 00:00:26,960 Speaker 2: I'm a year older, two. 8 00:00:26,760 --> 00:00:29,760 Speaker 1: Weeks old there, but yeah, across the mouse A happy birthday. 9 00:00:29,440 --> 00:00:31,680 Speaker 2: Thank you. It was last Monday. 10 00:00:32,120 --> 00:00:38,360 Speaker 1: My birthday is, it's around, it's coming weird, it's fine, 11 00:00:38,479 --> 00:00:40,000 Speaker 1: social Security number is. 12 00:00:41,479 --> 00:00:43,239 Speaker 2: Some people are so caged about their birthdays. 13 00:00:43,440 --> 00:00:48,400 Speaker 1: I guess I shouldn't be. It's like, don't don't be ashamed. Birthday, Katie, 14 00:00:48,600 --> 00:00:50,920 Speaker 1: thank you. Everyone's on your birthday is just Katie. 15 00:00:51,000 --> 00:00:52,880 Speaker 2: Yeah for me and Matt, just you can send. 16 00:00:52,760 --> 00:00:56,000 Speaker 1: Them to we have We have a close to overlapping birthday. 17 00:00:56,320 --> 00:00:56,600 Speaker 2: Yeah. 18 00:00:56,880 --> 00:00:59,800 Speaker 1: You and I had like birthday parties a day apart once, right. 19 00:01:00,120 --> 00:01:03,080 Speaker 2: Yeah, I went to your birthday party. 20 00:01:03,240 --> 00:01:03,440 Speaker 1: Yeah. 21 00:01:03,520 --> 00:01:05,480 Speaker 2: I was going to say the number leap the number. 22 00:01:07,800 --> 00:01:09,880 Speaker 2: That was fun. Okay, I didn't go. 23 00:01:09,880 --> 00:01:12,440 Speaker 1: To yours because I was like in the far reaches 24 00:01:12,480 --> 00:01:14,520 Speaker 1: of New Jersey, but I heard it was a wild time. 25 00:01:14,680 --> 00:01:16,560 Speaker 2: You should have gone, I should have gone. Well, my 26 00:01:16,640 --> 00:01:19,240 Speaker 2: baby showers there, so you should go to that. 27 00:01:19,360 --> 00:01:22,040 Speaker 1: Yeah, yeah, wild fire trucks. 28 00:01:22,720 --> 00:01:25,399 Speaker 2: No, maybe, I don't know, depending. 29 00:01:25,000 --> 00:01:29,840 Speaker 1: On depending how he Wow and Welcome to The Money 30 00:01:29,880 --> 00:01:32,520 Speaker 1: Stuff Podcast, new weekly podcast where we talk about stuff 31 00:01:32,520 --> 00:01:36,679 Speaker 1: related to money. I'm Matt Levine and I write the 32 00:01:36,680 --> 00:01:38,800 Speaker 1: Money Stuff Call for Bloomberg Opinion. 33 00:01:39,440 --> 00:01:42,040 Speaker 2: And I'm Katie Greifeld, a reporter for Bloomberg News and 34 00:01:42,080 --> 00:01:43,560 Speaker 2: an anchor for Bloomberg Television. 35 00:01:52,360 --> 00:01:55,040 Speaker 1: I got so many emails from people being like, are 36 00:01:55,080 --> 00:01:57,960 Speaker 1: you on vacation, because it's like a bit yea that 37 00:01:59,080 --> 00:02:01,400 Speaker 1: every time I go ahead becation, Elon Musk does some 38 00:02:01,480 --> 00:02:04,920 Speaker 1: wild thing and it's not like literally only when I 39 00:02:04,960 --> 00:02:06,640 Speaker 1: go on vacation. And in fact, I was not on 40 00:02:06,760 --> 00:02:08,080 Speaker 1: vacation last week, but you were. 41 00:02:08,160 --> 00:02:11,760 Speaker 2: Yeah, you were ready and waiting to. 42 00:02:10,960 --> 00:02:14,799 Speaker 1: To write about the SpaceX ip Yeah, which they made 43 00:02:14,800 --> 00:02:16,560 Speaker 1: the public filing for an IPO that is supposed to 44 00:02:16,600 --> 00:02:17,400 Speaker 1: go in like a. 45 00:02:17,400 --> 00:02:21,800 Speaker 2: Couple of weeks like mid June. Yeah, there's a it 46 00:02:21,880 --> 00:02:25,240 Speaker 2: was interesting to see all the different numbers. Is you said, 47 00:02:25,320 --> 00:02:28,960 Speaker 2: it seems like the AI is taking up a lot 48 00:02:29,000 --> 00:02:29,560 Speaker 2: of cash. 49 00:02:29,680 --> 00:02:33,040 Speaker 1: Yeah. Right. The basic financial situation here is like they have, 50 00:02:33,120 --> 00:02:36,160 Speaker 1: you know, a kind of goodish business of flinging satellites 51 00:02:36,160 --> 00:02:39,880 Speaker 1: into space and more importantly like charging people for satellite service. 52 00:02:40,120 --> 00:02:42,320 Speaker 1: They have had until recently a sort of money pit 53 00:02:42,440 --> 00:02:45,400 Speaker 1: for building a front of your AI lab that is 54 00:02:45,440 --> 00:02:50,280 Speaker 1: not necessarily the most renovator generating front of youer AI lab. 55 00:02:50,760 --> 00:02:54,000 Speaker 1: But now they've sort of switched, like like a little 56 00:02:54,000 --> 00:02:56,760 Speaker 1: too late for the IPO filing. They're now like a 57 00:02:56,760 --> 00:02:59,720 Speaker 1: AI infrastructure company that basically rents data centers through anthropic 58 00:03:00,120 --> 00:03:02,399 Speaker 1: you know whatever. Yeah, they've spent a lot of money 59 00:03:02,400 --> 00:03:06,560 Speaker 1: on AI. They've made more of their money on space. 60 00:03:07,480 --> 00:03:09,239 Speaker 1: But to me, the interesting thing is that sort of 61 00:03:09,320 --> 00:03:13,120 Speaker 1: projections they talk about their total addressable market, which is 62 00:03:13,200 --> 00:03:16,919 Speaker 1: a number you throw around for here is like where 63 00:03:16,960 --> 00:03:20,280 Speaker 1: we could make money, and you know, they say, we've 64 00:03:20,280 --> 00:03:23,440 Speaker 1: idented about the largest dam and human history or whatever, 65 00:03:23,720 --> 00:03:26,120 Speaker 1: twenty eight trillion dollars. But almost all of that is 66 00:03:26,240 --> 00:03:29,519 Speaker 1: enterprise AI. Right. The perspective begins with twelve pages of 67 00:03:29,560 --> 00:03:32,800 Speaker 1: photos and illustrations of rocket launches and Mars colonies, and 68 00:03:32,840 --> 00:03:35,600 Speaker 1: then it's like we're gonna do enterprise AI. Yeah, and 69 00:03:35,960 --> 00:03:38,120 Speaker 1: there's like a near term play of we make money 70 00:03:38,640 --> 00:03:41,120 Speaker 1: actually sending rockets into space. And then there's like a 71 00:03:41,160 --> 00:03:44,240 Speaker 1: medium term play We're gonna make trillions of dollars doing 72 00:03:44,360 --> 00:03:46,920 Speaker 1: enterprise AI, even though we just started that a couple 73 00:03:46,960 --> 00:03:48,920 Speaker 1: of months ago. And then there's like a long term 74 00:03:48,920 --> 00:03:51,520 Speaker 1: planet we're gonna build Mars colonies. Right, it's like a strange, 75 00:03:51,560 --> 00:03:54,560 Speaker 1: like you know, U shaped curve of space and then 76 00:03:54,600 --> 00:03:57,400 Speaker 1: AI and then more space. There are projections of like 77 00:03:57,400 --> 00:03:58,720 Speaker 1: how we're going to make money. It's like this is 78 00:03:58,760 --> 00:04:01,320 Speaker 1: an AI company, and I don't know if that's the 79 00:04:01,440 --> 00:04:04,560 Speaker 1: story that investors are hearing are interested in, but it 80 00:04:04,640 --> 00:04:06,640 Speaker 1: is sort of the when they look around to be 81 00:04:06,720 --> 00:04:09,320 Speaker 1: like how can we justify a two trillion dollar valuation, 82 00:04:09,440 --> 00:04:11,760 Speaker 1: it's like, well, we're gonna sell a lot of enterprise 83 00:04:11,800 --> 00:04:12,600 Speaker 1: AI software. 84 00:04:12,720 --> 00:04:14,560 Speaker 2: Yeah, this is what we're going to do in the meantime. 85 00:04:14,680 --> 00:04:15,920 Speaker 2: Before before the. 86 00:04:15,880 --> 00:04:19,080 Speaker 1: Mars colony becomes vilt that in orbital data centers, which 87 00:04:19,120 --> 00:04:21,200 Speaker 1: are now like they have gone from like a glimmer 88 00:04:21,240 --> 00:04:23,680 Speaker 1: and Elon Musk's side to everyone being like, oh yeah. 89 00:04:23,640 --> 00:04:25,320 Speaker 2: Urbal data center like a thing that you say with 90 00:04:25,320 --> 00:04:26,120 Speaker 2: the straight yeah. 91 00:04:26,000 --> 00:04:28,440 Speaker 1: Exactly exactly, like I have laughed the first time. 92 00:04:30,400 --> 00:04:32,160 Speaker 2: Well, yeah, of course, where else would you do with them? 93 00:04:32,200 --> 00:04:34,640 Speaker 2: It makes sense. Yeah, it's gonna be interesting. This is 94 00:04:34,680 --> 00:04:36,920 Speaker 2: also something else we've talked about on the podcast is 95 00:04:36,960 --> 00:04:42,720 Speaker 2: the Elon Musk premium that Tesla shares enjoy and I 96 00:04:42,720 --> 00:04:45,680 Speaker 2: I wonder if that's going to transfer to SpaceX. 97 00:04:46,000 --> 00:04:51,000 Speaker 1: They have, you know, like a eighteen billion annual revenue 98 00:04:51,080 --> 00:04:54,160 Speaker 1: run rate lose money, like then like all of the 99 00:04:54,240 --> 00:04:56,960 Speaker 1: numbers that are being talked about for the IPI or 100 00:04:57,080 --> 00:05:00,320 Speaker 1: load a mid one trillions to like two trillions to there, 101 00:05:00,480 --> 00:05:04,279 Speaker 1: that's a hundred times revenue for a money losing company. 102 00:05:04,920 --> 00:05:06,600 Speaker 1: I think that's an Elon Musk premium. 103 00:05:06,880 --> 00:05:10,280 Speaker 2: It sounds like it quite a large one. Yeah, that's fair. 104 00:05:10,360 --> 00:05:12,080 Speaker 1: I make fun of Elon Musk, but like if you 105 00:05:12,360 --> 00:05:16,599 Speaker 1: put money into SpaceX, you have more money now like 106 00:05:16,920 --> 00:05:20,719 Speaker 1: necessarily on a like profit basis, but on a valuation basis. 107 00:05:20,760 --> 00:05:21,840 Speaker 1: Like people have made a lot of money with the 108 00:05:21,839 --> 00:05:25,560 Speaker 1: Elon Musk and so there's a reason that people keep 109 00:05:25,560 --> 00:05:27,800 Speaker 1: putting a premium on investing with them, and like you know, 110 00:05:27,920 --> 00:05:30,240 Speaker 1: like like will that eventually run out? Will people like 111 00:05:30,279 --> 00:05:32,880 Speaker 1: who buy on the IPO be disappointed that like it 112 00:05:32,920 --> 00:05:35,280 Speaker 1: doesn't justify a two trillion dollar valuation like Marrie, I 113 00:05:35,279 --> 00:05:37,440 Speaker 1: don't know, but there's going to be an Elon Musk premium. 114 00:05:37,640 --> 00:05:39,680 Speaker 1: Even if this is a super disappointing IPO, It'll be 115 00:05:39,680 --> 00:05:40,640 Speaker 1: an Elon Musk premium. 116 00:05:40,680 --> 00:05:43,000 Speaker 2: And it'll also be in a bunch of indexes and 117 00:05:43,080 --> 00:05:45,240 Speaker 2: be in a bunch of it. There's a lot of consternation. 118 00:05:45,880 --> 00:05:47,479 Speaker 1: I was thinking about this, Like I had an email 119 00:05:47,480 --> 00:05:50,440 Speaker 1: from one person, you know, like a regular retail investor. 120 00:05:50,520 --> 00:05:52,240 Speaker 1: I put money at the SMP. Is there anyway for 121 00:05:52,279 --> 00:05:55,800 Speaker 1: me to short Elon Musk And the answer is like, sure, 122 00:05:55,839 --> 00:05:57,680 Speaker 1: short space AX if you want to get your you know, 123 00:05:59,080 --> 00:06:01,240 Speaker 1: and then it goes up to and you lose your shorts. 124 00:06:01,560 --> 00:06:04,200 Speaker 1: I totally understand, and I think I'm more sympathetic than 125 00:06:04,279 --> 00:06:06,960 Speaker 1: most people to the idea that, like the big indexes 126 00:06:07,080 --> 00:06:10,360 Speaker 1: have to include SpaceX on an accelerated basis. Like I 127 00:06:10,400 --> 00:06:12,720 Speaker 1: think that's right. Like I think when you're like the 128 00:06:12,839 --> 00:06:15,600 Speaker 1: S and P or the Russell three thousand or even 129 00:06:15,640 --> 00:06:18,039 Speaker 1: the Nasdaq one hundred, like you are more or less 130 00:06:18,040 --> 00:06:21,120 Speaker 1: saying we are the stock market, right, or at least 131 00:06:21,160 --> 00:06:23,279 Speaker 1: we're the large cap companies, or like in the ass case, 132 00:06:23,279 --> 00:06:25,359 Speaker 1: we're like the big tech companies. Listen, on ethic, Like 133 00:06:26,160 --> 00:06:28,920 Speaker 1: it would be a dereliction of their job to not 134 00:06:28,960 --> 00:06:34,360 Speaker 1: include in their index a gigantic return driving, super high 135 00:06:34,400 --> 00:06:37,440 Speaker 1: profile company that is a public company, Like they just 136 00:06:37,480 --> 00:06:40,280 Speaker 1: have to include SpaceX, Like I totally get it. And 137 00:06:40,480 --> 00:06:42,520 Speaker 1: people are mad because they're like waving their rules and 138 00:06:42,520 --> 00:06:45,080 Speaker 1: it's like they're waving their rules. They're really mad and 139 00:06:45,120 --> 00:06:48,280 Speaker 1: they're waving their rules to include this giant company. And 140 00:06:48,760 --> 00:06:52,120 Speaker 1: I'm very sympathetic to it, but I will say that 141 00:06:52,440 --> 00:06:54,560 Speaker 1: so many people are mad about it that there should 142 00:06:54,560 --> 00:06:57,279 Speaker 1: be a competitor index that's just like the S and 143 00:06:57,279 --> 00:06:59,840 Speaker 1: P five hundred without Elon Mosk. Right, my general view 144 00:06:59,880 --> 00:07:03,920 Speaker 1: is like if you are a passive index investor, you 145 00:07:03,960 --> 00:07:06,760 Speaker 1: can't like have standards. You can't be like, oh but 146 00:07:06,960 --> 00:07:08,840 Speaker 1: this company is bad, Right, that's not how it works. 147 00:07:08,880 --> 00:07:11,720 Speaker 1: Like you're you're taking the market's judgment. That's the market's judgment. 148 00:07:11,760 --> 00:07:14,200 Speaker 1: Is that SpaceX is worth two trillion dollars, then, like 149 00:07:14,640 --> 00:07:15,280 Speaker 1: that's the markets. 150 00:07:15,600 --> 00:07:16,960 Speaker 2: So you signed up, that's what you sign up for. 151 00:07:18,000 --> 00:07:20,760 Speaker 1: But like just empirically, a lot of people don't want 152 00:07:20,760 --> 00:07:22,120 Speaker 1: to sign up for that, and so you should give 153 00:07:22,120 --> 00:07:23,800 Speaker 1: them the other thing, Like it doesn't matter, Like it's 154 00:07:23,800 --> 00:07:26,200 Speaker 1: like esthetically displeasing to be like, wow, that's an index 155 00:07:26,200 --> 00:07:27,680 Speaker 1: fund with that Elon mus but the best people want 156 00:07:27,760 --> 00:07:28,040 Speaker 1: give it to. 157 00:07:28,320 --> 00:07:30,600 Speaker 2: It's like ex China, you know exactly. 158 00:07:30,600 --> 00:07:32,720 Speaker 1: It's like ESG indexes where it's like most of the 159 00:07:32,760 --> 00:07:34,720 Speaker 1: s and P five hundred but not the bad companies, right, 160 00:07:34,760 --> 00:07:36,400 Speaker 1: Like you do the same thing with Elon Musk. Yeah, 161 00:07:36,400 --> 00:07:38,280 Speaker 1: it would sell like hotcakes. 162 00:07:39,120 --> 00:07:41,920 Speaker 2: Well, and if it didn't, that also too would be interesting. 163 00:07:42,080 --> 00:07:43,720 Speaker 2: Like all of this hand ringing. 164 00:07:43,560 --> 00:07:45,840 Speaker 1: Was just that, right. Part of the hand ring is 165 00:07:45,880 --> 00:07:47,960 Speaker 1: people are mad about like their index funds being invested 166 00:07:47,960 --> 00:07:50,000 Speaker 1: in Elon Musk. Yeah, this drives me a little nuts. 167 00:07:50,040 --> 00:07:52,840 Speaker 1: But like part of it is active manager being like, well, 168 00:07:52,840 --> 00:07:57,400 Speaker 1: we're benchmarked to these indexes, and SpaceX is going to 169 00:07:57,440 --> 00:08:02,800 Speaker 1: be a huge driver of under or over performance, right, 170 00:08:02,840 --> 00:08:05,400 Speaker 1: Like either it'll go up a lot or it won't, right, 171 00:08:06,080 --> 00:08:09,600 Speaker 1: And the only way for us to be safe in 172 00:08:09,720 --> 00:08:11,920 Speaker 1: keeping our jobs is to like, I don't know, hug 173 00:08:11,960 --> 00:08:14,280 Speaker 1: the index on that one, right, and if like we 174 00:08:14,680 --> 00:08:18,800 Speaker 1: buy no SpaceX and ten xes, then we will look 175 00:08:18,880 --> 00:08:21,960 Speaker 1: terrible against the index that we're benchmarked too. Yeah, your 176 00:08:22,040 --> 00:08:24,640 Speaker 1: job is to actively manage when they're supposed to get 177 00:08:24,680 --> 00:08:27,440 Speaker 1: it right. But then unless people are really mad about it, 178 00:08:28,600 --> 00:08:31,080 Speaker 1: and it's going to be the most like attention getting 179 00:08:31,120 --> 00:08:33,440 Speaker 1: company in the index until it open a goes public. 180 00:08:33,559 --> 00:08:37,160 Speaker 2: It's interesting to point out that we also saw Russell, Yeah, 181 00:08:37,360 --> 00:08:40,319 Speaker 2: make the decision to fast track sure SpaceX, Like. 182 00:08:40,320 --> 00:08:42,560 Speaker 1: It's like the Russell three thousands. Every company they have 183 00:08:42,640 --> 00:08:44,040 Speaker 1: to it's crazy. 184 00:08:44,440 --> 00:08:47,520 Speaker 2: But it's probably worth pointing out that Nasak did win 185 00:08:47,559 --> 00:08:52,319 Speaker 2: the listing for the SpaceX IPO after they agreed to 186 00:08:52,440 --> 00:08:55,040 Speaker 2: let SpaceX in early to the NASAQ one hundred. 187 00:08:55,360 --> 00:08:56,800 Speaker 1: I know, but I don't like, I don't think that 188 00:08:56,840 --> 00:08:59,439 Speaker 1: these index providers, I mean, like maybe past that because 189 00:09:00,000 --> 00:09:01,840 Speaker 1: playing three dimensional chests or whatever. Like, I don't think 190 00:09:01,880 --> 00:09:03,480 Speaker 1: these index providers are, oh we have to kiss up 191 00:09:03,480 --> 00:09:06,400 Speaker 1: to Elon Musk. I think they are consulting with the 192 00:09:06,480 --> 00:09:10,600 Speaker 1: users of the indexes, index ones and investors generally, and 193 00:09:10,640 --> 00:09:13,400 Speaker 1: they're like, is this a public company? Yes, well then 194 00:09:13,440 --> 00:09:15,000 Speaker 1: it should be in the list of public companies. I 195 00:09:15,000 --> 00:09:15,320 Speaker 1: don't know. 196 00:09:15,480 --> 00:09:18,320 Speaker 2: Yeah, Well, the fact that it isn't just nastact is yeah, 197 00:09:18,480 --> 00:09:19,400 Speaker 2: add credence to that. 198 00:09:19,520 --> 00:09:23,920 Speaker 1: People are mad about indexes monking with their float requirements, 199 00:09:24,000 --> 00:09:26,320 Speaker 1: and in fact it looks like SpaceX's float will be 200 00:09:26,400 --> 00:09:29,040 Speaker 1: it's actually available, free float will be pretty low for 201 00:09:29,080 --> 00:09:31,560 Speaker 1: the first six months or so, like a lot of 202 00:09:31,559 --> 00:09:34,360 Speaker 1: shares will be subject to lock up, and so only 203 00:09:34,520 --> 00:09:36,640 Speaker 1: in the order of five percent of shares will trade. 204 00:09:36,640 --> 00:09:38,720 Speaker 1: And so if you force all the index ones to 205 00:09:39,800 --> 00:09:41,560 Speaker 1: squeeze into that five percent of shares are going to 206 00:09:41,559 --> 00:09:43,719 Speaker 1: push out the price a lot. I don't know how 207 00:09:43,720 --> 00:09:46,200 Speaker 1: binding that is. A lot of the indexes have like 208 00:09:46,240 --> 00:09:48,120 Speaker 1: float adjustments where it's not like you have to buy 209 00:09:48,120 --> 00:09:50,800 Speaker 1: the entire free float. And also the biggest index of 210 00:09:50,840 --> 00:09:53,319 Speaker 1: the S and P which is not going to add 211 00:09:53,360 --> 00:09:55,800 Speaker 1: it for six months or Yeah, so it'll be they'll 212 00:09:55,800 --> 00:09:57,640 Speaker 1: have more free float by then because the lock ups 213 00:09:57,640 --> 00:10:01,240 Speaker 1: will explare. But yeah, like the there's gonna be a 214 00:10:01,280 --> 00:10:03,959 Speaker 1: lot of index or day five in the case of 215 00:10:03,960 --> 00:10:05,920 Speaker 1: the Rustler, day fifteen in the case of the NAZAC, 216 00:10:05,960 --> 00:10:07,760 Speaker 1: which is when these when that will be eligible for 217 00:10:07,800 --> 00:10:09,880 Speaker 1: the index. There'll be a lot of like index demand 218 00:10:10,040 --> 00:10:11,640 Speaker 1: and not a lot of supply, and that could be 219 00:10:11,800 --> 00:10:13,120 Speaker 1: have weird dynamics for prices. 220 00:10:13,280 --> 00:10:16,040 Speaker 2: Yeah, you pointed this out in one of your columns. 221 00:10:16,080 --> 00:10:20,720 Speaker 2: But fifteen days, I mean fine, five days does seem 222 00:10:20,760 --> 00:10:23,640 Speaker 2: a little quick, like it'll it feels like it'll still 223 00:10:23,679 --> 00:10:25,120 Speaker 2: be funky at that point. 224 00:10:24,960 --> 00:10:27,120 Speaker 1: When a company goes public like s and P five 225 00:10:27,240 --> 00:10:29,679 Speaker 1: hundred funds are not buying in the IPO because who knows, 226 00:10:29,720 --> 00:10:34,040 Speaker 1: and I'll be added to the SMP. There's gonna be significant, 227 00:10:34,120 --> 00:10:38,640 Speaker 1: like Russell and Nazac, index demand for this company very 228 00:10:38,679 --> 00:10:42,840 Speaker 1: predictably within three weeks after, you know, one to three 229 00:10:42,840 --> 00:10:45,520 Speaker 1: weeks after the IPO, and so you know, like we'll 230 00:10:45,640 --> 00:10:49,480 Speaker 1: hedge funds be buying in the IPO to deliver in 231 00:10:49,520 --> 00:10:52,120 Speaker 1: their index arm strategy. Yeah, and so there's going to 232 00:10:52,160 --> 00:10:56,080 Speaker 1: be essentially index demand for these shares in the IPO, 233 00:10:56,559 --> 00:10:58,800 Speaker 1: and that's like a little unusual, right. I don't really 234 00:10:58,800 --> 00:11:00,520 Speaker 1: know the numbers, but like people have said, seventy five 235 00:11:00,520 --> 00:11:02,839 Speaker 1: billion dollars of stock coming in the IPO, which is 236 00:11:02,880 --> 00:11:05,760 Speaker 1: a giant IPO. Yeah, the valuation is one thing, but 237 00:11:05,760 --> 00:11:08,520 Speaker 1: then the amount of stock being issued is huge, and 238 00:11:08,600 --> 00:11:10,840 Speaker 1: some of that is going to go to institutional investors 239 00:11:10,840 --> 00:11:13,320 Speaker 1: who like the stock and go to meetings and build 240 00:11:13,360 --> 00:11:16,480 Speaker 1: some valuation model and come to some price and put 241 00:11:16,559 --> 00:11:19,280 Speaker 1: in an order at a price and get allocated the stock. 242 00:11:19,720 --> 00:11:22,320 Speaker 1: But some of it is going to come from really 243 00:11:22,360 --> 00:11:24,600 Speaker 1: like price in sensitive demand, which is like, you know, 244 00:11:24,640 --> 00:11:26,959 Speaker 1: thirty percent or whatever the deal is going to retail, 245 00:11:27,000 --> 00:11:32,680 Speaker 1: and retail is like generally in offerings is assumed to 246 00:11:32,679 --> 00:11:34,680 Speaker 1: be priced and sensitive, right, Like the retail just prices 247 00:11:34,720 --> 00:11:36,439 Speaker 1: at what the institutional prices. And so if you have 248 00:11:36,480 --> 00:11:37,880 Speaker 1: thirty percent going to retail, you have a lot of 249 00:11:37,880 --> 00:11:40,840 Speaker 1: price and sensitive demand, and then some of it is 250 00:11:40,880 --> 00:11:43,520 Speaker 1: going to effectively go to index funds, which are like 251 00:11:43,559 --> 00:11:44,960 Speaker 1: effectively priced and sensitive. 252 00:11:45,120 --> 00:11:47,560 Speaker 2: Yeah. Well, we brought up with the seventy five billion dollars, 253 00:11:47,600 --> 00:11:50,839 Speaker 2: and definitely the amount of the float that's available is 254 00:11:50,880 --> 00:11:53,760 Speaker 2: also one of the reasons why people are upset about 255 00:11:54,679 --> 00:11:56,600 Speaker 2: sort of the rules being bent here because I think 256 00:11:56,600 --> 00:12:01,880 Speaker 2: that's like five percent. Yeah, but think about that absolute number, 257 00:12:01,960 --> 00:12:04,840 Speaker 2: like seventy five billion dollars. I feel like the percent 258 00:12:05,520 --> 00:12:07,800 Speaker 2: becomes a little bit less meaningful. 259 00:12:07,880 --> 00:12:12,760 Speaker 1: Well depends if there were eighty billion dollars of index demand. 260 00:12:13,160 --> 00:12:15,680 Speaker 1: That would be a big deal, I don't think, because 261 00:12:15,760 --> 00:12:18,120 Speaker 1: it's not. The S and P day one and the 262 00:12:18,160 --> 00:12:20,800 Speaker 1: indexes all have like adjustments. The index inclusion is not 263 00:12:20,840 --> 00:12:22,560 Speaker 1: based on the entire market gap, but it's based on 264 00:12:22,559 --> 00:12:24,199 Speaker 1: some multiple of the. 265 00:12:24,160 --> 00:12:28,160 Speaker 2: Foot something I was just thinking about. So this IPO 266 00:12:28,240 --> 00:12:32,160 Speaker 2: is expected by June eleventh, it's expected on a Thursday. 267 00:12:32,559 --> 00:12:35,199 Speaker 2: What are we going to do well? I don't know, 268 00:12:35,480 --> 00:12:39,240 Speaker 2: live podcast. Yeah, we should come out with a really. 269 00:12:38,960 --> 00:12:41,280 Speaker 1: Strong start trading as we walk in here. 270 00:12:41,360 --> 00:12:43,360 Speaker 2: Yeah, Jeese Louise. 271 00:12:43,920 --> 00:12:45,240 Speaker 1: Maybe we can get them to move it up. 272 00:12:45,760 --> 00:12:48,840 Speaker 2: Yeah, I mean, just tom him a. 273 00:12:48,840 --> 00:12:50,880 Speaker 1: Price on a Thursday. I think so, and then I'll 274 00:12:51,040 --> 00:12:52,720 Speaker 1: trade on Friday, so it doesn't matter. 275 00:12:52,760 --> 00:12:55,080 Speaker 2: I need to think about this. We were trying to 276 00:12:55,080 --> 00:12:56,080 Speaker 2: plan it for television. 277 00:12:56,120 --> 00:12:58,840 Speaker 1: I have a governance a little bit. The governance is crazy. 278 00:12:58,880 --> 00:13:01,040 Speaker 1: It's not that crazy because you know, we talked about 279 00:13:01,040 --> 00:13:03,520 Speaker 1: the Elon Musk prenant. It's like the governance of this 280 00:13:03,559 --> 00:13:05,400 Speaker 1: company is Elon Musk can do whatever he wants, right, 281 00:13:05,480 --> 00:13:08,040 Speaker 1: he has eighty five percent voting control his super voting stock. 282 00:13:08,040 --> 00:13:09,720 Speaker 1: He also gets to a point more than you know, 283 00:13:09,800 --> 00:13:13,679 Speaker 1: fifty one percent of the directors regardless of his voting power. 284 00:13:13,679 --> 00:13:16,280 Speaker 1: Because he has the special stock, he doesn't have to 285 00:13:17,080 --> 00:13:21,000 Speaker 1: He's no obligations to like give the SpaceX any corporate opportunities. 286 00:13:21,080 --> 00:13:22,600 Speaker 1: So if he wants to start a new AI company 287 00:13:22,679 --> 00:13:24,760 Speaker 1: or a new space company, you just do it, and 288 00:13:24,800 --> 00:13:27,360 Speaker 1: he can't be sued for like preaching his fidy SIA duties. 289 00:13:27,559 --> 00:13:30,280 Speaker 1: He can basically not be sued for securities fraud. If 290 00:13:30,280 --> 00:13:31,880 Speaker 1: you super securities fraud, you have to do it in 291 00:13:31,920 --> 00:13:34,480 Speaker 1: Texas State court. And there's all this stuff and you 292 00:13:34,520 --> 00:13:36,920 Speaker 1: really can't sue for like preaching forty sharded is you 293 00:13:36,960 --> 00:13:38,800 Speaker 1: need to have three percent of the stock to do that, 294 00:13:38,840 --> 00:13:42,400 Speaker 1: which like there's tens of billions of dollars, and you 295 00:13:42,440 --> 00:13:45,320 Speaker 1: wouldn't do that if you didn't like Elon Musk. So 296 00:13:45,320 --> 00:13:48,080 Speaker 1: it's really just there's no checks on him whatsoever. And 297 00:13:48,559 --> 00:13:51,840 Speaker 1: I do think that that is how SpaceX has been 298 00:13:51,920 --> 00:13:54,840 Speaker 1: run up till now. He has worked out well for shareholders. 299 00:13:54,880 --> 00:13:56,800 Speaker 1: I think a lot of the sholders of SpaceX are 300 00:13:57,120 --> 00:13:59,400 Speaker 1: There's some quibbles about the ex high merger or whatever, 301 00:13:59,400 --> 00:14:02,120 Speaker 1: but the most the shareholders of SpaceX are pretty happy 302 00:14:02,120 --> 00:14:04,400 Speaker 1: with how Elon Musk is round the place. Yeah, And 303 00:14:04,480 --> 00:14:08,760 Speaker 1: I think that Elon Musk and a lot of investors like, yeah, 304 00:14:09,040 --> 00:14:11,120 Speaker 1: just letting Elon Musk do whatever he wants is the 305 00:14:11,200 --> 00:14:13,520 Speaker 1: right way to run this company. And the stuff that 306 00:14:13,600 --> 00:14:17,120 Speaker 1: happened to Tesla in Delaware where he got sued for 307 00:14:17,200 --> 00:14:21,640 Speaker 1: getting paid too much. Was not the right way for 308 00:14:21,720 --> 00:14:25,680 Speaker 1: Elon Musk to be governed, and he should get to 309 00:14:25,720 --> 00:14:28,600 Speaker 1: do what he wants. And they are fixing the mistakes 310 00:14:28,600 --> 00:14:31,800 Speaker 1: of Tesla by going public this way with SpaceX. I 311 00:14:31,840 --> 00:14:35,600 Speaker 1: think that's a reasonable analysis. But I also think that 312 00:14:35,680 --> 00:14:37,800 Speaker 1: as we just talked about, a lot of people who 313 00:14:37,840 --> 00:14:40,880 Speaker 1: will buy the stock in the near term are index funds, Yes, 314 00:14:40,920 --> 00:14:45,960 Speaker 1: and they don't like that. No, that's not their kind 315 00:14:46,000 --> 00:14:46,360 Speaker 1: of thing. 316 00:14:46,760 --> 00:14:50,400 Speaker 2: If you don't want SpaceX exposures, just buy an ESG fund. 317 00:14:50,440 --> 00:14:51,720 Speaker 2: It seems neat. 318 00:14:51,680 --> 00:14:54,400 Speaker 1: The ESG and Elon Musk relationship is interesting, right because 319 00:14:54,400 --> 00:14:56,440 Speaker 1: it's like, you know, he has in many ways very 320 00:14:56,480 --> 00:14:58,720 Speaker 1: environmentally friendly and in other way is not so ESG. 321 00:15:00,000 --> 00:15:04,760 Speaker 1: It's not so much there's this really bizarre precedence setting 322 00:15:05,560 --> 00:15:09,320 Speaker 1: management friendly governance of this company. And they were like, yeah, 323 00:15:09,320 --> 00:15:11,880 Speaker 1: that's what people want investing in SpaceX. That's what you 324 00:15:11,920 --> 00:15:14,760 Speaker 1: want to be. Like, what about the index ons, index ones? 325 00:15:14,920 --> 00:15:16,600 Speaker 1: Like the deal with indix ons is they don't get 326 00:15:16,600 --> 00:15:18,440 Speaker 1: what they want, they get what the market wants, right, 327 00:15:18,600 --> 00:15:21,600 Speaker 1: So that's that's the deal they're signing up for. But 328 00:15:21,680 --> 00:15:24,640 Speaker 1: it is a real new president now public companies are 329 00:15:24,680 --> 00:15:28,280 Speaker 1: governed and if it goes well, what we saw with 330 00:15:28,280 --> 00:15:30,760 Speaker 1: the Elon Musk like Winshot pay package is that every 331 00:15:30,800 --> 00:15:33,520 Speaker 1: other texto is like, I want a trillion dollars if 332 00:15:33,560 --> 00:15:36,040 Speaker 1: the people copy the Elon mus president because everyone wants 333 00:15:36,040 --> 00:15:38,240 Speaker 1: to be Elon Musk. And so I think you'll see 334 00:15:38,240 --> 00:15:41,000 Speaker 1: other companies go public with no constraints on their CEOs 335 00:15:41,040 --> 00:15:58,520 Speaker 1: and like not all old Elon Musk. So Robin Hood 336 00:15:58,560 --> 00:16:01,400 Speaker 1: like announced they're gonna let you like hook up your 337 00:16:01,560 --> 00:16:04,080 Speaker 1: AI agents to our trading account and you'll have a 338 00:16:04,120 --> 00:16:06,480 Speaker 1: special sandbox where they can't lose all of your money, 339 00:16:06,640 --> 00:16:09,160 Speaker 1: but they can lose as much money as you give them. Yeah, 340 00:16:09,200 --> 00:16:11,600 Speaker 1: and then you can like type in a box like 341 00:16:12,720 --> 00:16:15,400 Speaker 1: they have some examples, like an active trader can backtis 342 00:16:15,480 --> 00:16:18,000 Speaker 1: the mean reversion strategy to see how it performed historically 343 00:16:18,040 --> 00:16:20,280 Speaker 1: and to play it automatically buy over sold stocks and 344 00:16:20,320 --> 00:16:21,880 Speaker 1: so when they revert to the means, So stuff like that, 345 00:16:21,880 --> 00:16:23,440 Speaker 1: you can like type in a box like, hey, here's 346 00:16:23,440 --> 00:16:25,200 Speaker 1: a trade idea, and then your bot will do it 347 00:16:25,240 --> 00:16:27,240 Speaker 1: for you. And I read about this this week, and 348 00:16:27,280 --> 00:16:29,360 Speaker 1: I what I said was like you and I have 349 00:16:29,440 --> 00:16:32,720 Speaker 1: talked and I've written about how eventually every trade will 350 00:16:32,760 --> 00:16:35,160 Speaker 1: be an ETF. Yes, and like the ETF will be 351 00:16:35,200 --> 00:16:39,440 Speaker 1: like the universal rapper for trade ideas. And now I'm like, 352 00:16:39,480 --> 00:16:42,840 Speaker 1: now I'm wrong. It's not that it's agents. Agents will 353 00:16:42,840 --> 00:16:45,160 Speaker 1: be the universal rapper because like you'll be able to 354 00:16:45,160 --> 00:16:47,720 Speaker 1: think up whatever trade the idea you want, and instead 355 00:16:47,760 --> 00:16:51,880 Speaker 1: of like laboriously piecing together stocks and options and what 356 00:16:51,920 --> 00:16:54,120 Speaker 1: not to implement it, you'll just type the idea and 357 00:16:54,160 --> 00:16:56,360 Speaker 1: then your agent will do the laborious piecing together. 358 00:16:56,560 --> 00:17:00,120 Speaker 2: Yeah, I think it makes sense for trades. But and 359 00:17:00,200 --> 00:17:02,760 Speaker 2: if you're just you want to buy indexes. 360 00:17:02,600 --> 00:17:04,600 Speaker 1: Indexes, fine, yeah, yeah, but what has happened in the 361 00:17:04,680 --> 00:17:06,760 Speaker 1: last few years is that like ETFs have been not 362 00:17:06,800 --> 00:17:09,600 Speaker 1: just a rapper for index fund buy on hold ownership, 363 00:17:09,960 --> 00:17:12,280 Speaker 1: but also long short pair trade. 364 00:17:12,040 --> 00:17:14,880 Speaker 2: Strategy, stock auto call, all. 365 00:17:14,800 --> 00:17:17,480 Speaker 1: Sorts of nonsense. Yeah, and all that nonsense is going 366 00:17:17,560 --> 00:17:20,720 Speaker 1: to just be agentic AI and ETFs will be index 367 00:17:20,800 --> 00:17:23,480 Speaker 1: fense again. And like, you know, it's a little. 368 00:17:23,280 --> 00:17:26,200 Speaker 2: Sad for me, but I mean this is in your 369 00:17:27,160 --> 00:17:29,920 Speaker 2: for you, this isn't your vision of the world. There's 370 00:17:29,960 --> 00:17:32,200 Speaker 2: a lot of steps to make that happen. 371 00:17:32,280 --> 00:17:35,840 Speaker 1: Yeah, we're early days of agent Rabinhood trading. In fact, 372 00:17:35,880 --> 00:17:39,000 Speaker 1: they don't. They only have stocks right now, Like eventually 373 00:17:39,040 --> 00:17:42,640 Speaker 1: it will be your agent can do options and crypto 374 00:17:42,680 --> 00:17:45,120 Speaker 1: and prediction markets and then all the reil fund will happen, 375 00:17:45,160 --> 00:17:46,119 Speaker 1: but for not stocks. 376 00:17:46,440 --> 00:17:51,280 Speaker 2: And uh, it's also credit cards, right, like you can 377 00:17:51,320 --> 00:17:53,639 Speaker 2: instruct the agent to make purchases. 378 00:17:53,880 --> 00:17:55,960 Speaker 1: Yeah, which it was just not a thing that only 379 00:17:56,040 --> 00:17:58,840 Speaker 1: Robinhood has been working on. But neither is the record 380 00:17:58,920 --> 00:18:02,600 Speaker 1: stuff like public had a Bignoun's been about agentic brokerage stuff. 381 00:18:03,000 --> 00:18:05,480 Speaker 1: But bid Yeah, like your credit card. You can like 382 00:18:05,520 --> 00:18:08,159 Speaker 1: type in a box like buy me these sneakers if 383 00:18:08,160 --> 00:18:09,439 Speaker 1: they get cheap, and then it'll do. 384 00:18:09,520 --> 00:18:11,520 Speaker 2: It's just fun. I feel like you can imagine a 385 00:18:11,600 --> 00:18:15,480 Speaker 2: myriad of ways where this goes wrong. Yeah, sure, especially 386 00:18:15,920 --> 00:18:17,920 Speaker 2: I mean trading, yes, but also with the credit card. 387 00:18:18,040 --> 00:18:21,119 Speaker 1: Sure, I think like you can set like hard limits 388 00:18:21,119 --> 00:18:22,639 Speaker 1: on which the bot can spend. 389 00:18:23,200 --> 00:18:26,040 Speaker 2: That's true, But even still I could see the bots 390 00:18:26,080 --> 00:18:28,240 Speaker 2: being like, I don't know, this is a really good deal, 391 00:18:28,320 --> 00:18:29,720 Speaker 2: maybe we should just go for it. 392 00:18:30,119 --> 00:18:32,640 Speaker 1: Well, I think the idea is that the limits are 393 00:18:32,640 --> 00:18:36,600 Speaker 1: not internal to the bot. They're on the credit card. Yeah, 394 00:18:36,640 --> 00:18:38,840 Speaker 1: we're on the broker's account. If you say the bot 395 00:18:38,880 --> 00:18:40,879 Speaker 1: can have ten thousand dollars on my robin Hood account, 396 00:18:41,320 --> 00:18:43,720 Speaker 1: then like in theory, if your robin that if that 397 00:18:43,920 --> 00:18:46,120 Speaker 1: pot gets to zero, then the bot has to stop. 398 00:18:46,560 --> 00:18:49,840 Speaker 2: I do like your your vision of the world where 399 00:18:50,000 --> 00:18:55,040 Speaker 2: this replaces all these one click trade ETFs. It seems 400 00:18:55,080 --> 00:18:58,720 Speaker 2: like for the time being that Robinhood itself has less 401 00:18:58,760 --> 00:19:02,960 Speaker 2: ambitious desires here, they think. The write up by Bloomberg's 402 00:19:02,960 --> 00:19:06,040 Speaker 2: Page Smith quotes their vice president of product management for 403 00:19:06,119 --> 00:19:08,600 Speaker 2: Brokerage saying that you know, they're looking forward to learning 404 00:19:08,640 --> 00:19:11,200 Speaker 2: how different people use the product, which will inform how 405 00:19:11,240 --> 00:19:12,320 Speaker 2: the team develops it. 406 00:19:12,440 --> 00:19:15,639 Speaker 1: So yeah, I'm always exaggerating here, like probably like twenty 407 00:19:15,760 --> 00:19:18,359 Speaker 1: Like really you know, hardcore sophisticated people will use it 408 00:19:18,400 --> 00:19:21,720 Speaker 1: to like fairly sophisticated trades, right, and then like will 409 00:19:21,760 --> 00:19:25,200 Speaker 1: someone be like hey, if there's a dip by the dip, yeah, sure, yeah. 410 00:19:25,320 --> 00:19:26,959 Speaker 1: Like one thing that might happen is like there might 411 00:19:27,000 --> 00:19:29,800 Speaker 1: be like just sort of like emergent like common behavior 412 00:19:30,200 --> 00:19:32,960 Speaker 1: mm that that's codified, right, Like if everyone sort of 413 00:19:33,000 --> 00:19:34,600 Speaker 1: wakes up and like, oh I have a bot, what 414 00:19:34,680 --> 00:19:36,560 Speaker 1: should I have to do it? By the dip or 415 00:19:36,600 --> 00:19:39,240 Speaker 1: like whatever then like you might see I don't know, 416 00:19:39,280 --> 00:19:41,760 Speaker 1: you might see like different developments in the market where 417 00:19:41,760 --> 00:19:46,320 Speaker 1: like instead of instead of like retail traders all having 418 00:19:46,400 --> 00:19:48,159 Speaker 1: sort of random reactions than it is, they can all 419 00:19:48,240 --> 00:19:50,280 Speaker 1: sort of pre program the same reactions, and like they 420 00:19:50,359 --> 00:19:53,280 Speaker 1: might have more coordinated behavior. The other thing I want 421 00:19:53,320 --> 00:19:55,960 Speaker 1: to say is I wrote about this is this thing 422 00:19:56,080 --> 00:19:58,280 Speaker 1: only makes sense. It doesn't. It's not just a matter 423 00:19:58,320 --> 00:20:00,639 Speaker 1: of AI. It only makes sense because hood is offered 424 00:20:00,680 --> 00:20:03,359 Speaker 1: free trading for a long time. Right, I you know 425 00:20:03,560 --> 00:20:06,320 Speaker 1: was writing a financial column before free trading was a thing. Right, Like, 426 00:20:06,359 --> 00:20:08,359 Speaker 1: free trading is a development of the last eleven or 427 00:20:08,359 --> 00:20:13,040 Speaker 1: eight years. And in a world without free stock trading, 428 00:20:13,040 --> 00:20:15,680 Speaker 1: the idea that you'd tell you're bot like automatically buy 429 00:20:15,720 --> 00:20:17,359 Speaker 1: over sold stocks and sell when they revert to the 430 00:20:17,400 --> 00:20:19,760 Speaker 1: mean is crazy. It's like nine ninety five each time 431 00:20:19,760 --> 00:20:23,320 Speaker 1: you do that trade. And in a world where there 432 00:20:23,320 --> 00:20:26,520 Speaker 1: are no visible transaction costs, and like, there are definitely 433 00:20:26,520 --> 00:20:29,439 Speaker 1: invisible transaction costs, right, because you're definitely like dealing with 434 00:20:29,480 --> 00:20:31,760 Speaker 1: a market maker and paying a spa at each time 435 00:20:31,760 --> 00:20:34,560 Speaker 1: you trade that. In a world no visible transaction costs, 436 00:20:34,600 --> 00:20:36,160 Speaker 1: you can be like, yeah, do you like one hundred 437 00:20:36,160 --> 00:20:38,840 Speaker 1: trades a day, no problem. Right, So this is like 438 00:20:39,960 --> 00:20:43,800 Speaker 1: a technology that exists because Robinhood innovated in free trading. 439 00:20:43,840 --> 00:20:47,240 Speaker 1: But it's also a technology that is very lucrative for 440 00:20:47,400 --> 00:20:51,679 Speaker 1: Robinhood and for its like market maker partners, because it'll 441 00:20:51,920 --> 00:20:54,800 Speaker 1: if people use this, this is even more trades, right, Like, 442 00:20:54,840 --> 00:20:56,560 Speaker 1: if people use it, they're going to program a bot 443 00:20:56,600 --> 00:20:58,360 Speaker 1: that will do one hundred trades a day to take 444 00:20:58,359 --> 00:21:01,920 Speaker 1: advantage of some technal the they think of, and then 445 00:21:02,119 --> 00:21:05,399 Speaker 1: that'll generate a lot of revenue for the market makers 446 00:21:05,440 --> 00:21:10,879 Speaker 1: who fill orders on robinin everyone wins perhaps, yeah, I 447 00:21:10,920 --> 00:21:12,280 Speaker 1: mean like right, Like. 448 00:21:12,480 --> 00:21:14,760 Speaker 2: You might lose as the trade if you're. 449 00:21:14,600 --> 00:21:16,240 Speaker 1: Doing those hundred trades a day, Like, what are the 450 00:21:16,240 --> 00:21:18,840 Speaker 1: odds that you and your bot have come up with 451 00:21:18,920 --> 00:21:21,399 Speaker 1: a with a trade idea that not only beats the 452 00:21:21,440 --> 00:21:23,760 Speaker 1: market on a back desk, but that beats the market 453 00:21:25,240 --> 00:21:27,320 Speaker 1: after the actual transaction costs of trading. 454 00:21:27,080 --> 00:21:29,760 Speaker 2: On robin The dozen or so people who take up 455 00:21:29,760 --> 00:21:30,440 Speaker 2: this tool. 456 00:21:30,320 --> 00:21:31,639 Speaker 1: Someone's going to do great on it. 457 00:21:31,840 --> 00:21:32,000 Speaker 2: Yeah. 458 00:21:32,720 --> 00:21:33,920 Speaker 1: Also it's going to be sports betting. 459 00:21:33,920 --> 00:21:37,959 Speaker 2: But well, it just feels like you know the arc 460 00:21:38,000 --> 00:21:41,679 Speaker 2: of humanity sports. 461 00:21:40,840 --> 00:21:42,800 Speaker 1: Best the credit card, Like the first idea they have 462 00:21:42,840 --> 00:21:44,400 Speaker 1: for the credit card is like by this like cool 463 00:21:44,440 --> 00:21:47,840 Speaker 1: sneaker when it goes below whatever price. And it's like 464 00:21:48,080 --> 00:21:51,240 Speaker 1: lad Zenda has talked about like democratizing finance by like 465 00:21:51,280 --> 00:21:54,520 Speaker 1: introducing the new asset class, which is sports betting. I 466 00:21:54,600 --> 00:21:57,800 Speaker 1: mean sorry, pre sports betting. And it's funny to think of, 467 00:21:57,880 --> 00:22:01,879 Speaker 1: like like rob had started as like a stock brokerage, 468 00:22:02,040 --> 00:22:05,879 Speaker 1: and there's a world of asset classes out there, some 469 00:22:05,960 --> 00:22:10,280 Speaker 1: of which are like sneakers and sports bets, and yeah, 470 00:22:10,320 --> 00:22:12,439 Speaker 1: if you want it to be and like between the 471 00:22:12,440 --> 00:22:14,719 Speaker 1: credit card and the brokerage, soon all of the like 472 00:22:16,320 --> 00:22:19,119 Speaker 1: retail phasing asset classes will be sort of like fungibly 473 00:22:19,119 --> 00:22:21,680 Speaker 1: tradable and you can be like I mean trade you know, 474 00:22:21,760 --> 00:22:23,600 Speaker 1: I mean you tell your agent if these sneakers get 475 00:22:23,680 --> 00:22:25,679 Speaker 1: cheap by them, but if the stock gets cheap by that, 476 00:22:25,760 --> 00:22:27,720 Speaker 1: and if the sports bet gets you just have a 477 00:22:27,800 --> 00:22:32,400 Speaker 1: sort of like fungible dashboard of bets that you can make. 478 00:22:33,160 --> 00:22:35,439 Speaker 2: I do want to call out a line in your 479 00:22:35,480 --> 00:22:38,560 Speaker 2: column about this that I just really loved this sentence 480 00:22:38,640 --> 00:22:41,720 Speaker 2: that if in your shameful secret heart, what a beautiful 481 00:22:41,760 --> 00:22:44,160 Speaker 2: phrase you want to do a trade like by every 482 00:22:44,200 --> 00:22:46,520 Speaker 2: stock whose ticker begins with C, so out of the 483 00:22:46,560 --> 00:22:49,200 Speaker 2: money call options on every stock who sticker begins with D. 484 00:22:49,680 --> 00:22:51,600 Speaker 2: Nobody will sell you an ETF like that, and you'd 485 00:22:51,600 --> 00:22:53,800 Speaker 2: be too embarrassed to ask. I love thinking about like 486 00:22:53,840 --> 00:22:56,080 Speaker 2: the human psychology element, right. 487 00:22:56,119 --> 00:22:58,119 Speaker 1: I probably could have come up with a more shameful idea, 488 00:22:58,160 --> 00:22:59,880 Speaker 1: But then I was like, I'm really going to spend 489 00:22:59,880 --> 00:23:02,480 Speaker 1: like ten minutes sitting here like the most shameful. 490 00:23:03,760 --> 00:23:06,840 Speaker 2: What's the most embarrassing trade I could ask to be 491 00:23:06,880 --> 00:23:08,240 Speaker 2: packaged into an ETF? 492 00:23:10,160 --> 00:23:10,399 Speaker 1: I did. 493 00:23:10,520 --> 00:23:12,399 Speaker 2: I did love that, though, I will say I was 494 00:23:12,440 --> 00:23:14,960 Speaker 2: sitting on the path this morning reading that, thinking about 495 00:23:14,960 --> 00:23:19,080 Speaker 2: my own shameful secret heart, and like, I don't know, 496 00:23:19,080 --> 00:23:20,760 Speaker 2: I didn't get very far. I didn't come up with 497 00:23:20,800 --> 00:23:22,760 Speaker 2: a shameful trade, but it's fun to imagine. 498 00:23:22,800 --> 00:23:26,560 Speaker 1: Tell me about your sci fi novel, Yeah. 499 00:23:25,920 --> 00:23:26,760 Speaker 2: I don't. 500 00:23:26,520 --> 00:23:29,239 Speaker 1: I think we aired it well. 501 00:23:29,240 --> 00:23:31,919 Speaker 2: I don't want anyone to see you told. 502 00:23:31,800 --> 00:23:33,600 Speaker 1: Me about it extensively on MIC and then we cut 503 00:23:33,600 --> 00:23:34,040 Speaker 1: it all that. 504 00:23:34,240 --> 00:23:39,200 Speaker 2: It's all about blood anyway and space. But listen, we'll 505 00:23:39,200 --> 00:23:41,520 Speaker 2: come out by twenty thirty and then everyone could buy it. 506 00:23:42,280 --> 00:23:43,119 Speaker 1: We're going to talk about this. 507 00:23:45,560 --> 00:23:47,880 Speaker 2: I'm going to really lock in finally and write this 508 00:23:48,119 --> 00:24:06,200 Speaker 2: GD book. Do you want to start with baseball or 509 00:24:06,240 --> 00:24:07,280 Speaker 2: do you want to start with drugs? 510 00:24:07,680 --> 00:24:09,200 Speaker 1: You're like, round to go with drugs. 511 00:24:09,359 --> 00:24:12,040 Speaker 2: I want to talk about drugs because longtime listeners of 512 00:24:12,040 --> 00:24:15,320 Speaker 2: the Money Stuff podcast will remember me talking about like 513 00:24:15,320 --> 00:24:17,879 Speaker 2: the drug Olympics that I wanted to happen, where like 514 00:24:17,920 --> 00:24:19,800 Speaker 2: all the athletes are on drugs and we just let 515 00:24:19,840 --> 00:24:21,960 Speaker 2: them battle to the death alone. 516 00:24:22,280 --> 00:24:24,439 Speaker 1: No, brothers also want that. 517 00:24:24,640 --> 00:24:30,200 Speaker 2: Yeah, and Peter Tile apparently yikes. So the Enhanced Games 518 00:24:30,560 --> 00:24:33,720 Speaker 2: that was exact. That was exactly their idea as well. 519 00:24:34,119 --> 00:24:39,080 Speaker 2: They had their first event Sunday in this past Sunday 520 00:24:39,080 --> 00:24:41,040 Speaker 2: in Las Vegas, and uh. 521 00:24:41,280 --> 00:24:45,240 Speaker 1: It was a bit of a bus we've talked about 522 00:24:45,920 --> 00:24:49,240 Speaker 1: they're like, Onion, sorry about doping and tressage? 523 00:24:49,280 --> 00:24:52,240 Speaker 2: Have we have we not bring me back up to speed. 524 00:24:52,720 --> 00:24:57,119 Speaker 1: There's like a truly insanely funny, like long form Onion, 525 00:24:57,200 --> 00:25:00,280 Speaker 1: sorry about doping and dressage. That's hope. 526 00:25:01,040 --> 00:25:02,359 Speaker 2: I don't think I've read this one of. 527 00:25:02,320 --> 00:25:04,439 Speaker 1: The funniest Onion things that it might be quick, but 528 00:25:04,480 --> 00:25:05,600 Speaker 1: its the Onion franchise. 529 00:25:05,720 --> 00:25:09,400 Speaker 2: What's the thrust of it that they gave the horses drugs? Yeah, yeah, 530 00:25:09,400 --> 00:25:15,520 Speaker 2: oh well, yeah, well there is a lot of you know, 531 00:25:16,119 --> 00:25:21,959 Speaker 2: athleticism involved anyway, don't drug your horses. Okay, So there 532 00:25:21,960 --> 00:25:25,679 Speaker 2: were some technical glitches in the Enhanced Games. Apparently the 533 00:25:25,720 --> 00:25:28,040 Speaker 2: live stream froze for more than ten minutes during the 534 00:25:28,080 --> 00:25:36,040 Speaker 2: first competition. The bigger thing was that you had three 535 00:25:36,160 --> 00:25:39,359 Speaker 2: athletes who were described by the organizers as clean. They 536 00:25:39,359 --> 00:25:42,119 Speaker 2: didn't take any drugs, they won their events. There was 537 00:25:42,160 --> 00:25:47,200 Speaker 2: only one world record set in the entire games. I 538 00:25:47,240 --> 00:25:48,200 Speaker 2: think it was in swimming. 539 00:25:49,200 --> 00:25:51,560 Speaker 1: Record is pretty good. It's better than nowhere, Like for 540 00:25:51,600 --> 00:25:53,760 Speaker 1: your first for your first outing, to set a world 541 00:25:53,840 --> 00:25:55,280 Speaker 1: record is pretty good because. 542 00:25:56,880 --> 00:26:00,320 Speaker 2: I feel like I feel like people wanted and I 543 00:26:00,320 --> 00:26:03,280 Speaker 2: think the event itself also said that you know, we're 544 00:26:03,280 --> 00:26:05,560 Speaker 2: going to see like we're going to break all the records. 545 00:26:05,720 --> 00:26:08,359 Speaker 1: Sure, I feel like you're not going to get the 546 00:26:08,480 --> 00:26:11,879 Speaker 1: very top tier of Olympic level athletes to compete in 547 00:26:11,920 --> 00:26:14,439 Speaker 1: the Drug Games, but you get the next tier or 548 00:26:14,520 --> 00:26:18,600 Speaker 1: three tiers down, and then if taking drugs allows them 549 00:26:18,600 --> 00:26:20,280 Speaker 1: to break our world record, like that's a pretty good 550 00:26:20,280 --> 00:26:21,080 Speaker 1: case for drugs. 551 00:26:21,600 --> 00:26:22,119 Speaker 2: That's true. 552 00:26:22,160 --> 00:26:25,000 Speaker 1: I don't want to get here like kids take drugs. 553 00:26:25,119 --> 00:26:28,879 Speaker 1: That's Peter till Job like I'm persuaded, I'm going to 554 00:26:28,960 --> 00:26:30,080 Speaker 1: go take some steroids. 555 00:26:30,560 --> 00:26:32,920 Speaker 2: Well, you can also sort of take the other side 556 00:26:32,920 --> 00:26:35,720 Speaker 2: of this trade going on, because enhanced group shares fell 557 00:26:35,760 --> 00:26:38,600 Speaker 2: to an all time low after the event. I didn't 558 00:26:38,640 --> 00:26:43,560 Speaker 2: know that this was publicly listed. It is. It was 559 00:26:43,640 --> 00:26:48,200 Speaker 2: down like forty I think on Tuesday, which is nuts. 560 00:26:48,720 --> 00:26:51,040 Speaker 2: It is interesting though, I feel like we did prove something, 561 00:26:51,040 --> 00:26:53,360 Speaker 2: which is that it takes more than drugs. 562 00:26:53,600 --> 00:26:56,119 Speaker 1: No, it took it. They got a world record in 563 00:26:56,240 --> 00:26:58,760 Speaker 1: one event. How many did they do? 564 00:26:59,119 --> 00:27:01,760 Speaker 2: They did a bunch like how many Okay, I don't 565 00:27:01,760 --> 00:27:02,760 Speaker 2: have the number in front of me. 566 00:27:02,840 --> 00:27:04,719 Speaker 1: But they run a whole Olympics, did they? 567 00:27:04,960 --> 00:27:06,320 Speaker 2: They did a lot of different stuff. 568 00:27:06,480 --> 00:27:06,720 Speaker 1: Come on. 569 00:27:07,040 --> 00:27:09,479 Speaker 2: The thing that I cared, the thing that I care 570 00:27:09,520 --> 00:27:12,800 Speaker 2: about is of course the sprints as a runner myself. 571 00:27:12,920 --> 00:27:16,359 Speaker 2: The one hundred meter dash. The winner was Fred Curley. 572 00:27:16,440 --> 00:27:18,720 Speaker 2: He's an actual Olympian. He was one of the clean ones, 573 00:27:19,280 --> 00:27:23,520 Speaker 2: and I mean he won the field clean sure, which 574 00:27:23,560 --> 00:27:25,359 Speaker 2: I don't know. I just I feel like we proved 575 00:27:25,400 --> 00:27:28,320 Speaker 2: that you need more than drugs you need in. 576 00:27:28,240 --> 00:27:32,320 Speaker 1: One hundred meter dash. Well the first time, like if 577 00:27:32,359 --> 00:27:35,320 Speaker 1: this thing like we're real and ten years later it 578 00:27:35,320 --> 00:27:37,960 Speaker 1: has like a big prize pool. Then like somebody who's 579 00:27:38,040 --> 00:27:40,720 Speaker 1: going to finished seventh in the Olympics, he'll be like, yeah, 580 00:27:40,760 --> 00:27:43,440 Speaker 1: you know what, screwt, I'll set a world record in 581 00:27:43,480 --> 00:27:45,359 Speaker 1: the handscams and win a prize pool. Like, I don't know, 582 00:27:45,400 --> 00:27:49,399 Speaker 1: it was a good start. Actually, I have bush on 583 00:27:49,440 --> 00:27:50,119 Speaker 1: the drug games. 584 00:27:50,119 --> 00:27:52,600 Speaker 2: The payout does look pretty good. I think the world 585 00:27:52,760 --> 00:27:55,960 Speaker 2: record that was said, I think the winner got like 586 00:27:55,960 --> 00:27:56,680 Speaker 2: a million dollars. 587 00:27:57,920 --> 00:28:00,960 Speaker 1: It's yeah, I don't know what the general payouts for 588 00:28:01,080 --> 00:28:03,280 Speaker 1: like it really. 589 00:28:04,600 --> 00:28:07,840 Speaker 2: Not a million dollars. I take the more like human 590 00:28:08,160 --> 00:28:12,440 Speaker 2: optimists then, which is like, you need god given talent 591 00:28:13,359 --> 00:28:15,560 Speaker 2: really hard drugs. 592 00:28:15,600 --> 00:28:19,679 Speaker 1: But but surely their point is that is that people 593 00:28:19,720 --> 00:28:25,679 Speaker 1: who have that plus drugs, you know what that's worth it. 594 00:28:25,880 --> 00:28:28,040 Speaker 2: What we really need is to, as you said, take 595 00:28:28,040 --> 00:28:31,600 Speaker 2: the absolute best athletes from the Olympics and give them 596 00:28:31,640 --> 00:28:32,920 Speaker 2: drugs and then we'll really. 597 00:28:33,119 --> 00:28:35,840 Speaker 1: Like the seventh best, like that's that's who they're going for, right. 598 00:28:35,880 --> 00:28:37,800 Speaker 1: The person is not going to win a medal, but 599 00:28:37,920 --> 00:28:40,440 Speaker 1: like with drugs. 600 00:28:40,040 --> 00:28:42,600 Speaker 2: Yeah, with drugs, you could I feel like I've been 601 00:28:46,360 --> 00:28:48,880 Speaker 2: we really got to look into your shameful secret heart. 602 00:28:49,120 --> 00:28:51,280 Speaker 1: Anyway, speaking of people who have taken performance and had 603 00:28:51,360 --> 00:28:55,120 Speaker 1: some drugs to play sports. Yes, it's true. 604 00:28:55,720 --> 00:28:58,600 Speaker 2: So I don't know anything about baseball. So so. 605 00:28:58,720 --> 00:29:01,480 Speaker 1: Fernando Tatis Junior is a guy I've written about a 606 00:29:01,480 --> 00:29:03,840 Speaker 1: few times because he's involved in a fascinating piece of 607 00:29:03,920 --> 00:29:07,959 Speaker 1: financial structuring. He was a minor league baseball player in 608 00:29:07,960 --> 00:29:11,440 Speaker 1: like twenty seventeen who was wined and dined by this 609 00:29:11,480 --> 00:29:14,160 Speaker 1: company called Big League Advance, and they were like, we'll 610 00:29:14,200 --> 00:29:17,360 Speaker 1: give you two million dollars right now in exchange for 611 00:29:17,440 --> 00:29:19,920 Speaker 1: ten percent of your future earnings in Major League Baseball 612 00:29:20,240 --> 00:29:22,440 Speaker 1: if you make it to the majors. And if you're 613 00:29:22,440 --> 00:29:24,640 Speaker 1: a minor league player, you live on peanuts and your 614 00:29:24,720 --> 00:29:26,800 Speaker 1: chances of making it to the majors are slim. And 615 00:29:26,840 --> 00:29:31,040 Speaker 1: so he took the money and gave up ten percent 616 00:29:31,080 --> 00:29:34,000 Speaker 1: of his future earnings, and then he made it to 617 00:29:34,000 --> 00:29:38,479 Speaker 1: the majors in fairly short order and did really well 618 00:29:39,080 --> 00:29:43,360 Speaker 1: and fairly quickly, and then pretty quickly assigned a fourteen year, 619 00:29:43,400 --> 00:29:46,440 Speaker 1: three hundred and forty million dollar contract with the Padres 620 00:29:46,960 --> 00:29:51,480 Speaker 1: and was like, wait a minute, I'm giving up thirty 621 00:29:51,480 --> 00:29:54,240 Speaker 1: four million dollars, you know, a two million dollar advance 622 00:29:54,280 --> 00:29:56,720 Speaker 1: three years ago or whatever. Yeah, and so he sued. 623 00:29:57,320 --> 00:29:58,760 Speaker 1: He waited a while to suit, like this is this 624 00:29:58,800 --> 00:30:00,960 Speaker 1: all happened? And he signed as the the Padres twenty 625 00:30:01,680 --> 00:30:06,720 Speaker 1: one or something, and he sued last year saying, this 626 00:30:06,960 --> 00:30:11,280 Speaker 1: was a you serious loan, This was you loaned me 627 00:30:11,400 --> 00:30:14,320 Speaker 1: two million dollars and you're charging me one thousand percent interests. 628 00:30:14,440 --> 00:30:15,160 Speaker 2: Just predatory. 629 00:30:15,240 --> 00:30:18,040 Speaker 1: It's predatory. And he's like, I was a naive seventeen 630 00:30:18,120 --> 00:30:20,320 Speaker 1: year old kid. There's some quotes in the story. He's like, 631 00:30:20,320 --> 00:30:22,200 Speaker 1: you know, I want to protect those young players who 632 00:30:22,200 --> 00:30:24,160 Speaker 1: don't yet know how to protect themselves from these predatory 633 00:30:24,240 --> 00:30:27,200 Speaker 1: lenders and illegal financial schemes. Baseball should be about our 634 00:30:27,200 --> 00:30:29,920 Speaker 1: passion for the game, not dodging shady businesses driven only 635 00:30:29,960 --> 00:30:35,120 Speaker 1: by profit and greed. Okay, so he lost last week, Yeah, 636 00:30:35,240 --> 00:30:38,640 Speaker 1: basically because he didn't object to arbitration soon enough, and 637 00:30:38,720 --> 00:30:40,880 Speaker 1: so he still has to pay big league advance. They 638 00:30:40,920 --> 00:30:44,760 Speaker 1: are millions of dollars. I have a couple of views 639 00:30:44,840 --> 00:30:46,440 Speaker 1: on this. One is that I read all the time 640 00:30:46,480 --> 00:30:48,720 Speaker 1: about businesses that by equity and people. I'm like, yeah, 641 00:30:48,760 --> 00:30:51,480 Speaker 1: this is the trade, right. Sometimes you invest in a 642 00:30:51,520 --> 00:30:53,640 Speaker 1: minor league player, you give them an advance, they never 643 00:30:53,680 --> 00:30:55,640 Speaker 1: make the majors, you can get zero dollars back. Right. 644 00:30:55,640 --> 00:30:58,120 Speaker 1: It's like a venture capital portfolio. Right. Sometimes you invest 645 00:30:58,160 --> 00:31:00,440 Speaker 1: in a minor league player and you give thellion dollars 646 00:31:00,440 --> 00:31:02,920 Speaker 1: and they sign a gigantic contract and get thirty. You know, 647 00:31:03,240 --> 00:31:07,640 Speaker 1: it's just it's a portfolio. And if you are the players, 648 00:31:08,600 --> 00:31:11,040 Speaker 1: and you're the minor league player who takes in advance 649 00:31:11,200 --> 00:31:13,280 Speaker 1: and then doesn't make it to the majors, that was 650 00:31:13,320 --> 00:31:15,640 Speaker 1: a good trade for you, for sure, But you're sad 651 00:31:15,760 --> 00:31:17,880 Speaker 1: because you would have rather made the majors. If you're 652 00:31:17,920 --> 00:31:21,680 Speaker 1: Fernando Tettis Junior, on the one hand, you are paying 653 00:31:21,720 --> 00:31:24,320 Speaker 1: back a very large multiple of the money you got. 654 00:31:24,440 --> 00:31:25,840 Speaker 1: On the other hand, you make three hundred and forty 655 00:31:25,880 --> 00:31:30,000 Speaker 1: million dollars. Fine. But so also, every time I write 656 00:31:30,000 --> 00:31:31,560 Speaker 1: about this, I get several emails from people and they 657 00:31:31,600 --> 00:31:34,240 Speaker 1: all say the same thing. They say, Fernando Tuttis Junior 658 00:31:34,520 --> 00:31:39,320 Speaker 1: is a junior. His father is Fernando Tuttis's And they 659 00:31:39,400 --> 00:31:43,240 Speaker 1: always say that Fernando Tuttis is the only person to 660 00:31:43,320 --> 00:31:44,920 Speaker 1: hit two Grand slams in the same inning of a 661 00:31:44,960 --> 00:31:47,400 Speaker 1: Major League baseball And this is the most notable fact 662 00:31:47,520 --> 00:31:51,120 Speaker 1: about the Tuttis family apparently, But they also say, look, 663 00:31:51,160 --> 00:31:53,360 Speaker 1: he was doing fine. He was a successful major leaguer. 664 00:31:53,360 --> 00:31:57,960 Speaker 1: His son was, first of all, not like some hopeless prospect. 665 00:31:58,000 --> 00:32:00,680 Speaker 1: He was like the top prospect in baseball. He knew 666 00:32:00,720 --> 00:32:02,440 Speaker 1: he was going to have a major league career. And secondly, 667 00:32:02,480 --> 00:32:04,360 Speaker 1: he wasn't like broke, no like. 668 00:32:04,920 --> 00:32:07,200 Speaker 2: So I went on a real educational journey here because 669 00:32:07,200 --> 00:32:10,320 Speaker 2: I don't know anything about baseball. But you linked to 670 00:32:10,320 --> 00:32:13,520 Speaker 2: the New York Post story about this, which anytime I 671 00:32:13,520 --> 00:32:16,320 Speaker 2: don't think we often discuss like New York Post stories 672 00:32:16,720 --> 00:32:20,600 Speaker 2: on this podcast. But I didn't realize who his dad was. 673 00:32:21,480 --> 00:32:24,800 Speaker 2: Twenty million dollars in career earnings. Why on earth would 674 00:32:24,800 --> 00:32:27,360 Speaker 2: his son need a two million dollar advance, asked the 675 00:32:27,360 --> 00:32:29,720 Speaker 2: New York Post, Which is a good question. But they 676 00:32:29,760 --> 00:32:32,600 Speaker 2: also say, and again, I don't know anything about baseball, 677 00:32:32,600 --> 00:32:35,120 Speaker 2: So I'm just believing them that anyone with two eyes 678 00:32:35,120 --> 00:32:36,920 Speaker 2: could see that he would one day become a star, 679 00:32:37,040 --> 00:32:40,960 Speaker 2: and baseball's bloated contracts in a league without a salary cap, 680 00:32:41,160 --> 00:32:43,360 Speaker 2: ten percent of his future earnings was going to be 681 00:32:43,480 --> 00:32:47,880 Speaker 2: much greater than a two million dollar upfront payment. Yeah, 682 00:32:48,280 --> 00:32:49,440 Speaker 2: you lay it out like that. 683 00:32:49,440 --> 00:32:52,640 Speaker 1: No, so right, Like one thing is maybe it's evaluation playing. 684 00:32:52,640 --> 00:32:55,560 Speaker 1: Maybe he's like, ah, I'm gonna suck. Like one thing 685 00:32:55,560 --> 00:32:57,200 Speaker 1: that has happened is he had a great start to 686 00:32:57,240 --> 00:32:59,080 Speaker 1: his career and let people are a little mad at 687 00:32:59,120 --> 00:33:00,560 Speaker 1: him now because he's stopped to home runs. 688 00:33:00,600 --> 00:33:02,280 Speaker 2: And also, well he got his money. 689 00:33:02,600 --> 00:33:05,080 Speaker 1: Yeah, he got his money, but also he was suspended 690 00:33:05,080 --> 00:33:07,680 Speaker 1: for eighty ams for performance enhancing drug finding and he 691 00:33:07,800 --> 00:33:12,600 Speaker 1: was injured. He's been less successful in recent years then 692 00:33:12,760 --> 00:33:16,760 Speaker 1: in the years and forty million dollar contract. But anyway, 693 00:33:16,800 --> 00:33:19,480 Speaker 1: a lot of people have the same reaction as the post, 694 00:33:19,600 --> 00:33:21,920 Speaker 1: which was like he didn't need this two million dollars 695 00:33:22,000 --> 00:33:26,280 Speaker 1: so much that he was making a good financial decision 696 00:33:26,360 --> 00:33:29,920 Speaker 1: signing away. Yeah, Like it's a good hedge, right, it's 697 00:33:29,960 --> 00:33:31,680 Speaker 1: I mean, depending on you know how much money his 698 00:33:31,680 --> 00:33:33,239 Speaker 1: father still has. It's a good hedge. Right, you get 699 00:33:33,360 --> 00:33:35,400 Speaker 1: two million dollars. Now if it doesn't work out, people 700 00:33:35,400 --> 00:33:37,040 Speaker 1: get injured. Even doesn't work out and you don't get 701 00:33:37,040 --> 00:33:39,320 Speaker 1: the three hundred and forty million dollar contract, then like 702 00:33:39,400 --> 00:33:42,680 Speaker 1: you have the money now, and like when you enter 703 00:33:42,720 --> 00:33:45,239 Speaker 1: into a hedge and then things work out great, their 704 00:33:45,320 --> 00:33:46,240 Speaker 1: hedge is a waste. 705 00:33:46,280 --> 00:33:48,320 Speaker 2: But it's like you know, sometimes you lose money on 706 00:33:48,360 --> 00:33:49,000 Speaker 2: a hedge. 707 00:33:48,760 --> 00:33:49,680 Speaker 1: But that's good. 708 00:33:50,000 --> 00:33:50,280 Speaker 2: Yeah. 709 00:33:50,320 --> 00:33:52,520 Speaker 1: Do you want that as opposed to the thing where 710 00:33:52,800 --> 00:33:54,800 Speaker 1: the hedge pays off, because like the good thing didn't 711 00:33:54,840 --> 00:33:55,240 Speaker 1: pay off. 712 00:33:55,320 --> 00:33:58,840 Speaker 2: I hope he's listening, you know, maybe that would make 713 00:33:58,880 --> 00:34:03,320 Speaker 2: him feel better me saying I don't know anything about this, 714 00:34:03,440 --> 00:34:13,480 Speaker 2: but this guy. 715 00:34:14,640 --> 00:34:17,680 Speaker 1: And that was the Money Stuff Podcast. I'm Matt Levine and. 716 00:34:17,640 --> 00:34:18,600 Speaker 2: I'm Katie Greifeld. 717 00:34:18,840 --> 00:34:21,000 Speaker 1: You can find my work by subscribing to The Money 718 00:34:21,000 --> 00:34:22,960 Speaker 1: Stuff newsletter on Bloomberg. 719 00:34:22,600 --> 00:34:25,200 Speaker 2: Dot com, and you can find me on Bloomberg TV 720 00:34:25,360 --> 00:34:28,800 Speaker 2: every day on the Clothes between three and five pm Eastern. 721 00:34:29,480 --> 00:34:31,480 Speaker 1: We'd love to hear from you. You can send an 722 00:34:31,480 --> 00:34:34,840 Speaker 1: email to Moneypod at Bloomberg dot net ask us the 723 00:34:34,920 --> 00:34:36,759 Speaker 1: question and we might answer it on the air. 724 00:34:37,120 --> 00:34:39,720 Speaker 2: You can also subscribe to our show wherever you're listening 725 00:34:39,760 --> 00:34:41,600 Speaker 2: right now and leave us a review. It helps more 726 00:34:41,640 --> 00:34:42,479 Speaker 2: people find the show. 727 00:34:43,239 --> 00:34:47,560 Speaker 1: The Money Stuff Podcast is produced by Anamazarakis, Moses andm 728 00:34:47,960 --> 00:34:49,920 Speaker 1: and Alexis HoTT Our. 729 00:34:50,000 --> 00:34:52,040 Speaker 2: Theme music was composed by Blake Maples. 730 00:34:52,800 --> 00:34:56,200 Speaker 1: Amy Keen is our executive producer. Thanks for listening to 731 00:34:56,239 --> 00:34:58,560 Speaker 1: The Money Stuff Podcast. We'll be back next week. 732 00:34:58,640 --> 00:34:59,520 Speaker 2: With the more stuff