A Certain Somebody Suddenly Fancies The 2Y

Thank you guys so much. Greetings and welcome to Inside Baseball with Old Chestnut. I'm Liam Allen with my friend Morsex. How you doing, MB? Buddy, I I was doing great until about ninety seconds ago when I erased all of my notes for today's show. I saw you fucking around on something on the monitor. I missed canoe.

Like Alec Alec Baldwin said, fuck it, I'm going anyway. Oh good Lord. Um, well, at least you fired me off uh 20 emails this afternoon. Maybe you might have to send some of them back to me. Um, I had a great week, honestly. I mean Getting home was a little bit of a d a drag, but um Other than that, I had a really nice week. What were you doing? Where were you?

Oh, I was down uh in God's waiting room for the weekend visiting uh Turk and Rebecca. In case anyone doesn't know what God's waiting room is, it's Florida. And you had let me get this straight. So you and you had a ball, right? Oh unbelievable. Unbelievable. But it's layered. There's there's texture to it because If you run with me a little bit, remember that seminal work, reminiscences of a stock operator? Of course. Yeah. Jesse Livermore, yeah, yeah.

So I don't know, that book was written something in the twenties, nineteen twenties-ish. And he talked about Going down to I think Florida to the Breakers for some R and R, right? So we're down in in that area, Florida and the Breakers. And the place is jump. I'm telling ya, it's like Models and bottles. So you stayed at the Rakers. So you weren't in the neighborhood. No, we stayed we stayed at uh our friend's house.

Yeah, and what is that boca retone or is it West Palm? It's uh West Palm. And then we drove into Pump Palm Beach, right? So we we see the whole thing here and Th this whole show, tonight's whole show, pops into my mind all at once, which is why I don't know that I need any notes, but so The reference to Jesse Livermore, okay, going to the Breakers in the twenties and thirties was back then that was a cool place to be. Okay. It still is. It still is. Well

It it it is, but there was a a rather meaningful gap of time where it wasn't. Okay. Okay. So stay with me here. Okay.

So you got all these uh geniuses from New York moving down to Florida because of the taxes, right? And so it's In my mind, primarily Goldman and Citadel. Okay. So the friends we stayed with, their house is quadrupled in price in the last four years. What dribbled. Yeah. I went for a walk around the neighborhood. I shitshue. I saw no less than six Rolls-Royces. I mean a dozen Lamborghinis. And this is in like

Are you which side which side of the intercoastal water you waterway are are you on? Are you on the barrier island or are you are you inland from the barrier island? I was told there would be no questions. I I don't know like the side that the the the eldel airports are. They live like fifteen minutes from the airport. Okay, okay. So so we we go to a a v a lovely restaurant on Saturday night.

And the place is just jummin, jumping. Rocking, rocking, right? And the women are so pretty. Cheryl looks at me and she says, look at those young women. Aren't they pretty? I'm like When does a wife say that, right? And and I said, unluckily for them, I'm off the market, right? I mean, I'm off the dating market. My prices are generally pretty good, but but I have this epiphany, right? So what what's happened? You have all these big machers.

Running down to Florida. Okay. They're bidding up the prices of real estate. Okay. Because You know, it's it's a strip. It's like a little, you know what it is. It's fantastic. I know. Great, great. Okay. So so you're on you're with me so far, right? Okay. Well, when I worked at Deutsche Bank. Many a moon ago, there was a fellow, an administrative manager, his name was Bob Kelly. And uh he wasn't much of a trader, but he was a good businessman. And he was very kind.

to me in a lot of ways. And one of the things was giving me bits of career advice. And two bits of advice I never forgot. One, never have your name taken off of a revenue line. Meaning as long as you can point the PL, you're never gonna have a problem. Okay. Second, never ever work anywhere but the home office. This is it's it's fatal to your career. Wow. So We're going to make this like a Quentin Tarantino thing. So we're sitting in our friend's house. They move down there.

about four years ago because the wife's mother was ill and so she wanted to to help her mother move to the next stage in life and we were there Since the mother's past, and this woman and Cheryl are very, very tight.

Our friends down there, they're just fucking miserable. They're like Six months of the year, you cannot go outside. It's just too fucking hot and humid. Okay. She said the people are assholes. Everyone's walking around with a gun, right? It may not be your cup of tea. They're more moderate, but it's

It's Trump territory. Oh, totally. If you're a Trump guy, you're right at home. Yeah. If you're not a Trump guy, you're not at home. Right? Okay. So as I'm seeing this thing in my mind play out, you get all these schmoes. From Goldman and Citadel to

paying up five times for real estate because oh I gotta be down in Florida because there's no income taxes. And you know that's the cool place to be. And Palm Beach has got all this this hot chicks and this music and And all I can think of is they're gonna go through two cycles. The fact that their income tax being lower, remember, income tax is a percentage. Income is a whole number.

Well, remember a while ago I told you about that guy I rode the train with, the oil guy, Bromley de Merritt. Mm-hmm. Said Morris, the good deals never leave Texas. Texas, yep. There's no good deal going down to Florida. Not a fucking chance. You gotta be in the mix, man. In the mix. Mm-hmm. In I mean, don't get me wrong. Hookers and cocaine, ground zero. Yep. Okay. I and and if that's your thing, God bless you. But but by the way.

from sources believed to be reliable but we cannot be guaranteed, they have hookers in cocaine in New York. Now now I'm assuming that Because a couple weeks ago, there was their dentist. in Nantucket with hookers and cocaine and a gun. So if you can get hookers, cocaine, a gun and a yacht in Nantucket. Yeah. You can get you can even get the yacht in Nantucket, right? Yeah. So You're gonna move down to Florida. In short order, your wife or life partner is gonna be fucking miserable.

The school sucks. Right. And you know, there's no income tax. No, but they run the property tax up your ass like you can't believe. Yeah, there's a price that that comes with no property. too like your your services like when you call the cops like you call the cops in green

They're there in in six minutes, even up in the country where you live. Like in in Broward or like you know what I I grew up in in in the nineties. I used to watch enough of the up this TV episode Cops. I watched Broward County. Okay. Broward County and like West Pog. Wagon the wagon train. Yeah. I mean, it is it's different down there, you know. You call it's it's it's different. There's a different edge to it. But dude, it is bumping. All right. So

How about that could be what if that's a generational thing, dude? Because there's a there's a a big chunk of a demograph of guys. Between 40 and 65 that want to be down there because it rocks like you were out on Saturday. Dude, it rocks on Monday, Tuesday, and Wednesday night. It looks like everybody from Long Island and Jersey went down there that made their money, went down there, bought the bought the Rolls Royce and the Beach House and isn't going back.

to hack and I don't know. I don't know. First of all No money, no honey. Yeah. Okay. I know. And and being a little bit older and having seen a few cycles, all those guys who made it. Yeah. It that money goes faster than shit through a goose. Yeah. Okay. Yeah. Yeah. There's nothing to do but buy boats down in Florida. By the way, so we we we show up down there.

They pick us up at the airport. We go to a a very, very nice casual type, but you know, real real nice quality, favorable cost of the thing. And I'm looking and I'm trying not to stare. Because there's a woman at the table and it's not Jeff Bezos's girlfriend. He's moving there too. He announced he's moving there too. Go on. I know. Go on. Perfect. Perfect. Fits my narrative. This woman's lip.

Look like she got stung by fifty bees. A disaster? A fish face? Yeah, the big fish face? What the fuck is that about? Bad job. It's a bad job. And that's women not helping women. Another woman's supposed to be like, Look, Susie, that looks terrible. You gotta get that fixed. Well some people don't know she's too busy saying those build those boobs are too big because I know she's gonna be in traction. I know, I know, I know and then and then I'll say this quietly. What's with the Fed asked that?

It's gross, dude. It's horrific. They all get a it's surgical enhancement. It's horrific, dude. It's gonna come back. Dude, it's self hate, okay, is what it is. It's it's s it's a demonstration of self hate, okay? But you you didn't spend you didn't spend enough time that that you're you're like a kid that like you're like a kid from Ohio that comes to New York City that like goes to Times Square and he's like he's like good lord get me back to the corn you know like

Yeah, you'll get over that. Like after like after like four or five days, you ignore the cars and the and the plastic. Okay. And then back down. You can get down to some nice. food and the beaches, what you is what what what you're there for, okay? That fat ass disgusting something I cannot unsee. Judy, it's a horrible thing. It's yeah, I know, I know. Let's go, let's go, let's go, let's go, let's go, let's go. I know. I know but I understand Florida.

Dude, and you're in West Palm. You weren't even in Miami. You go down to Miami. Oh, there's no Miami. Oh, I know, I know. I remember when I went there, I asked you some questions and you had some curt answers and you were like, Good luck, kid, you're on your own. Yeah, I I think we won't be traveling to Florida. Ark, ARK, Ca Kathy's down there. You know, Kathy She'll fit right in. She'll fit right in. Um

Yeah. Um somebody had some statistics that in part of my uh colostomy of what I did with my notes, I can't find them, but they can kind of compare her notes. Um I mean her returns, which obviously have been horrific. The thing I kind of wondered and went back and forth with one of our listeners, one of our polite email listeners. Go on, go on. See, I I'm kind of wondering back when I was yo young, your age, I had all my securities registrations. You know, the series seven, the sixty-four.

Or sixty two or forty three, whatever it was. Like I had the ones you needed. And there's laws about what you can say about how stocks are gonna pret how stocks are gonna perform. And I'm not sure She's following the letter of the law. Um, I don't know how you can go talk about you got the best research in the business. just after you bought a stock it and then you go public and tell every I I don't know. I I g I I guess

I guess she's been doing it she's been doing it so publicly. It's it's be it's been done so publicly. But I don't think it it's become like a joke. It's embarrassing at this point that like it's you know like you know, joke or not. You know, rules.

I love them. We we live with the animals. Dude, and a lot of guys say that. A lot of guys I see a lot of that that are like, how is she like she shouldn't be allowed to do this? And there's like on on that on that cesspool of a website, there's a there is

There's a tracker that'll be like these are Kathy's daily trades. And they'll be like, Kathy was on CNBC on Monday saying Tesla's going to 2000. On Tuesday, she dumped 500,000 shares at Tesla. She sold them, you know. So they're like, This is kind of you know, dude, I can't.

I know. We don't have enough time, dude. Like in Seinfeld when they stopped the applause when Kramer would burst in. We we're good. We might she's at that point on our show, I think. Is that right? Okay, right? What are we gonna say? We haven't spoken of her in in a while. Right. Um I was I was uh Frankly, my feelings were a little hurt. Okay. The goat, Stan Druckemuller announces.

He's gonna get massively long the two-year note, levered. Nearly an email from anybody saying, hey, wait a minute, MB. What weren't you the two you know guy? And and I I thought we were. I uh the two I'll send him a t shirt. Oh you want me to deliver him a t shirt? I'll send him. T shirt's sold out. Gone. I know. We got one. Even the one On its way to frickin' Australia. You see? For another$35 in postage.

You know what did you want? What did you want Stan to say? Like, uh I you know, I listen to inside baseball, I've listened I've been listening. So someone say, Hey, wow, you happen to be ahead of the world's greatest trader. Instead I get a we get a note from some guy saying, Hey, if you think Lacey Hunt so smart, why shouldn't I just listen to him and not you?

You know what? Go ahead. Listen to him. Go ahead. Go listen to lady. Because you're too fucking stupid to understand what he says. We have to Liam and I have to interpret it for you. That's that's Um you were having a nice week in Florida. You had a were you down there all week? Oh, I was there for forty eight hours. Okay, okay, right. Thus thus the sh thus the shell shock, okay.

But uh so it was a good week for me for a number of reasons. One is Sam Bankman Fried. I mean how long did that take? No, could that could that have taken less time? They just they barely had time to order the pizza. Yeah. Yeah, get make sure they got paid for the whole day, right? Yeah, absolutely. We're out of here. So official advice. Sam from all of us here at IBWAC. Don't resist. Okay. It just makes them more excited. Secondly, relax.

Don't fight it. He's in a tough he's in a tough spot. He's in a tough spot'cause like he k he's gotta he's gotta join join sides here and like he's not is he are the whites gonna take him? I don't think the whites are gonna take him. You know, he might have some money squirreled away so like he might be able to to make a deal with somebody. Uh you know, he does Yeah, well you know, tough spot. He's gotta he's gonna you know like You just gotta shave that head and go in there strong or

Or he's gonna go in there and say, Hey, look, your commissary is gonna be full there, fellas. Uh I don't know how that works. I don't know. I I'll refer to the book that was recommended to me, How to Survive and Thrive in Prison. Which I did read, but I'm not recommending it to our listeners.

You know, they haven't even started going after mom and palm. They've already said they're broke. They came out and they said they're broke. They said we have no money left. Yeah, sure. Yeah. Checks in my mouth. Right. Exactly.

Exactly. How many how many houses did you buy in the Bahamas with some LLC that they're never gonna be able to touch that you're gonna have squirreled away, you know? Oh they'll they'll get'em. Oh no, no, no. The you can't do that. Okay. Uh there's some rules like If you buy a house in Florida, for example, okay, and you go bankrupt, they can't take your house from. However, if you know you're going to go bad.

And you go buy a house in Florida, that I think is a different story. Interesting. It's certainly uh away from Florida, it's I think what they call remember, we don't provide tax or legal advice. It's called a fraudulent conveyor. So if you knew you were broke and you gave away all sorts of shit to somebody before the the bankruptcy trustee could get involved, he's just gonna go claw that shit back. So those people are done for the rest of their life. They will have liens because the lawyers.

You know, like in the chess, guys play chess, they got that clock and they hit the thing. It's gonna be in those lawyers, that's five, six hundred bucks an hour. They're looking, they're looking at ten lot yeah. Yeah, oh yeah, yeah, yeah, yeah. Yeah. So and I don't think the father said that's what's money. I think the dad I think a quote I saw was that's what's money that's what's money's for.

He's is he a politician? No, he's a like a professor at Stanford. Yeah, that even those guys don't have that kind of money unless they manage the Pelosi Fund. Which um let's go back to your good week. Let's go back to your good So um yeah, so I I was delighted that all of our anti-heroes that we've been talking about, DJ Sal, right, he's been defrocked. Effectively. Then the Thoranos woman. Yeah, yeah. See, what uh yeah, what's her name? Yeah, exactly. She's gone. Now we got, you know, airhead.

Gone. He's he'll never see him again. No, no, no, no. Federal federal you do eighty percent. Bye bye. Bye bye. Bye bye. We should go up and do an interview. You don't want to travel? I got other people. I got other people we can talk to. Um and uh I I I I hate to brag.

But I had a big day Friday. I I had the biggest day I've had in a couple of years. So all of those munis. Can you just say one q sip? Give me one q. No. I won't give you any q subs. No, that's not on the table. But I would like to address The concept of the munis because they have I I don't want to be disingenuous on these things, but I I want I want to tell my side of the story because one of our listeners asked about um agency bonds. Yeah. Because I'm always badmouth immunis. So

My first part-time job in the business, I worked for a Muni broker dealer. We cleared through a company in Chicago called Mezzerow and Company. I don't know if they're still around. But we did a lot of trading off of the inventory of a bigger muni house called William Blair. So my my first foray into the markets were was really municipal bonds. Like what back then? Give me a good one from back then. Like what years?

Nineteen seventy eight. Yeah, well were they Well, I you know, I can not even remember the names of these. They're such arcane names, right? Like it could be like Texas School Book. Yeah, that's So I'm very comfortable with municipals, just generically speaking. Then when I went to Greenwich Capitol, there were two gentlemen who had come from Solomon who were mortgage experts. And I sat right next to them. And after a couple of years.

We started trading together both personal and for the firm. And um uh we hit it off, just great personalities. And then by the nature of municipals, they went off on their own and I I still do business with them to this day. And it's it's quite significant in relation to the to the size of the market. And it's a it's a really a symbiotic relationship. I mean I I pay them, I think I hope they think a generous commission when we do a trade. But when they see a bond, they will do an analysis of the

Then they'll bring the analysis to me and we'll discuss it. And then if I like it, I'll take it. And if I don't, no hard feelings, we move on to the next one. But the comments about municipal bond, when I talk to the general public, is these are unique issues. There is no generic municipal bond. And when I tell people and caution them about municipal bonds, that's not complete hooey.

If you don't know what you're working with, you know, you're gonna get you're gonna get stuffed with something. Now, Municipal bonds have an absurdly low default rate. I mean, I I again I'm not gonna get held to these numbers, but I'm sure it's below two percent. It could be in the one. And if I'm wrong by 20%, it's a mistake. It's not disinformation. Just just to be clear. Um, but um my caution.

Part of it was I was just being silly. I mean that's kind of like one of my ponds. I don't want people playing in my pond. But secondly, my concern is for the unsophisticated investor. you know, oh I Morris likes municipal bonds and they go buy some piece of shit thing. Yeah. Well, yeah, I don't want somebody to do that.

However, and this is not investment advice. This is not solicitation to buy or sell securities, but When IG and I used to sit next to each other, we started thinking about these ETFs, these exchange traded funds. And in generally speaking, You didn't get the best and the brightest, manager.

You know, maybe they started out that way, but if they got to be good, somebody snapped them up because, you know, they weren't getting paid a lot of money and they were never going to get But one of the little known things about many of these Muni ETFs is their levers. You you have to dig down to see about the leverage. Now it's not significant, but it's leverage and it's it's let's say it's about a third.

And so what IG and I decided, and this is like 10, 15 years ago, was When you thought the Fed was going to start easing, you wanted to grab these Muni ETFs because. Part of the thing is is the Fed's easing the borrowing rate is going down, which means You're paying less to borrow money. That's a good thing. The second thing is as the Fed's easing, credit spreads.

tend to narrow because rates are lower, it's easier to make your interest payments. So credit spreads make muni bonds look more attractive. And then As the Fed's easing, you generally get a uh a rally, meaning rates decline, and um the the curve steepens, which again, very positive for credit. In the world of munis... You don't uh get to pick the time and place or when you're buying. Y you know, you there's times you can buy'em.

But you may not want to, but the only time you can buy them is when someone's selling them. If I own Munis and I need to sell them, I can call my guys and they'll give me a bid. Right? There's always going to be a bid. It may be a suck-ass bid, but there's going to be a bid. And then I can Take it or leave it. But it doesn't work the other way. So you wake up in the morning and decide, I want to buy Munis.

I call my guys and they're like, yeah, there's nothing. There's nothing you can buy. And and it's not because they're so special. It's just there aren't any floating around. So the ETFs, they who owns them all? Who owns them all? Who owns all the muni? Well I when you speak generically, meaning the actual bonds, I I think, you know It's gonna be, and I don't know the proportion, but it's gonna be banks, insurance companies, individual investors, pension funds, the that.

Um but it's a small market like in treasuries 50 million five year notes. It's it's trivial. 50 million munis, it's like you'll put pen to paper for half an hour to put a price on it, just to give you an order of magnitude. So, you know, we're in an environment here and I'm fully loaded. Personally. But if I weren't I'd sit down with EG and we'd have a chat.

about the credit spreads the shape of the curve, what's the Fed gonna do? What's the forward curve gonna look like? But this is one of these rare times where for a period of time an ETF makes some sense because if you want to buy a million dollars of an ETF, you just go to the New York Stock Exchange and you buy and you got a million dollars. And in that ETF is a million dollars worth of munis, right? You could call your guy and say, Offer me a million munis and he's going, I got none.

So you get a toehold by being in the ETF, right? And then if you're you know artsy craftsy, You can wait till you saw Muni you like. You could buy that and sell out the the proper amount of the the ETF, right? I mean that might be a little bit more of a Kevin Muir kind of trade explanation. We we try and be big picture.

But um anyway, you you see what I'm getting at, right? So I so why did I have a good week? I had a good week because You know, I read that um paper by Howard Marks, and you know, he's talking about Stuff is backed up when you wanna buy things, you know, you y you're not necessarily gonna get to buy everything at the bottom, but I've been and I I think I've talked a bit about this, that I've been buying some longer dated paper. Um and uh it it they got marked against me pretty good. Um

That statement is no longer operative. Um, and just to throw a little kerosene on the fire, I had of a lot of these floating rate notes. I talked about those, right? Thursday I swapped them for fixed. So I I You know, old Chestnut took a little rest. And, you know, I got lucky. And um so I Fed what the Fed meeting drove that? The Fed meeting, the the idea that they're done hiking, that that just the no hike, the whole, that triggered that?

Triggered my decision? No, the the the run up on Friday. Well, I think the run-up on Friday was you've you've got a bunch of economic things. First And again, being in God's waiting room, information doesn't get there as quickly, which is another good reason to move there for for work. Um, the ADP number was a little bit weak. then the payroll number wasn't as strong. And again, as we suggest, look at the revisions. The revisions were down. Nine months in a row. Nine months in a row.

I think it's something like that. Well, I know nine months in a row they've missed the economists have missed their estimates. I don't know about the revisions per however months gone back. But I know there was a downward revision from the prior month. But amongst the series of things that memory serves I sent you that I don't know anymore. Gasoline prices are coming down. Copper prices are coming down. I looked at the purchasing manager surveys. They're all it's it's

It's over. Yep. You know? And um how long before? starts easing. I I think it'll be a while. I do. Uh and I'm gonna say I don't feel I'm obligated to define a while. Um I think you know they're gonna wanna be comfortable that the inflation is continuing to decline. Uh they got a lot of room vis a vis the the employment stuff. Right, before you know the numbers get scary enough that they're worried about the employment dropping too quickly. So I I I I think they they they can be very patient.

What I find the most curious thing at the moment, the real question in my mind, more the most important thing. For me is trying to figure out what the yoker is gonna do. Because the two-year note. Is it a four eighty five? By the way, Sherry, if you're listening, you have a fifteen or twenty basis point profit and that you you and Jerry can decide whether you want to take your profit or not. I I have no advice on that score. But um So two year notes or two hundred eighty five

the long bond, excuse me, 485 and the bond is uh call it a 480. So the the curve's still inverted and You know, I I think the curves gotta get uninverted by the front end moving more than the back end. in the goat, Stan Druck owns a massive amount of two year notes. You know, he's not a guy I I would fade on these things. I you know, he

I don't know what he looks at, but it ain't a whole lot different to what I must be looking at. And you know, i in the old days when you saw the economy weakening, you you bought two year notes and uh Why don't I own two-year notes? Because it's the notion of the present value of an 01. So if you're looking to make the most money. You you want two things. You want the issue that's going to move the most number of basis points, but you also want the issue that moves the most dollars per basis.

So again, I'm a little conflicted on where I should be because you know if you think the two-year note's gonna rally 150 basis points. That's going to be X amount of dollars. you know, if you're levered that means one thing. If you're unlevered You you gotta figure out how many basis points the tenure note's gonna rally. And then decide whether you want to own twos or tens. I mean the math when you sit down and do it is trivial. I i at this point I I can't do it in my head anymore. Um

Uh but uh you know, generally these things end up somewhere in the intermediate sector is where you probably want to own things. But it it feels to me like uh uh conventional wisdom is now starting to move towards the understanding that the world is not coming to an end, that the government will be able to pay its bills. that the economy is slowing, that ultimately the Fed will lower rate.

And we'll go kind of back to business as usual. And the panic about the government defaulting and, you know, shutting down. And uh, you know, I think we go back to a much more normal environment. So in my world I think the question is what's going to happen to the curve. I I think

The less interesting question is what happens to the stock market. I I say less interesting because I know probably in terms of numbers more people are involved in the stock market, but I think the bond market, the numbers are just so much bigger.

that, you know, that's the where the real heavy lifting gets done. So, you know, like like to put it simply, it seems like the employment's slowing. Gasoline prices based on what I read are declining. Copper prices are declining. Crude oil, as we speak, eighty one dollars a barrel with a war in the Middle East. You know, I these are these are things that shouldn't be here. if inflation was taking off. And one of the things which I've

really bummed out that I lost was I talked about I think last week, you don't have it. Don't don't bother looking for it. I think I can do it from memory. I talked about how I'm getting rid of these paid channels. subscription services. So one of these guys, I went back and because I remember him putting out an article and the the title was, Do you own enough silver? And I I looked at the thing and the it was dated Sometime in two thousand twenty.

Okay. And uh I read the article and at the time silver was trading at$20 an ounce. And the article said In the year 2021, silver will be the strongest asset to own in the world. And so from 2020 to 2021, it went nowhere. So I I'm guessing it wasn't the s the the strongest asset in the world. Now The whole time, this entire time I've been reading this newsletter, they've been nothing but bullish on gold and silver the whole time. Okay. Silver closed.

At$23 and change on Friday, that's after being down at like$12 in the early part of 2020, right? They they're looking, they their price target was 50 bucks, like three years ago. 50. So twice what it is right now. Never during this entire period have they ever cried Mia Culpa, I was wrong, my bad, I feel terrible. So for me, I c I say this Very often. That's why I like trading. It's the number. If if you said you made money but is red.

Then you didn't make money. Um is this the same you sent me a screenshot of them from September third of two thousand and three? Okay. Is this the uh this is the research group with a number in the name? Might be, yeah. It might be, although I you sent me uh you sent me a screenshot, okay. Just don't say their name. I'm not I didn't I'm I know what I'm doing here, okay? But you sent me a screenshot and circled in red.

And the byline says September third, two thousand three. And it says in February in February of ninety eight, Warren Buffett announced that Berkshire Rathaway Had accumulated roughly 130 ounces of silver. 130 million ounces of silver. Okay, this is from O three. Yeah. 2003. And I mean, I don't want to touch the computer, but I'm sure it hasn't worked that. I there's no way he has that so far. I mean, he you know.

He had a bad day and he bought it. I mean he you know like he might have been broken up with No three talking about some silver he may or may not have bought back in ninety eight, like starting an article with that bullshit. All right. All right. Come on. Let's go. Back to your good week. Talk to me. But but the point is, these guys, they get on this thing, and these guys now they're all about the gold. Gold, gold, gold, gold, gold, gold. Oh, you know what? Fine.

Fine. You think gold's going up? God bless you. Okay. But I'm I'm out of the business. of paying people for this stuff. The the other one which I can't find. Let me ask a question. What did gold do what did gold do when the when the market crashed in eighty seven? Honestly, I don't know. Yeah. Yeah. It probably tells you something right there. Right, exactly. Like it didn't rocket. It didn't nobody got nobody made a fortune on their gold trade in the eighty seven crash, did it?

You know, the problem the problem with the gold thing, and this feeds into the second newsletter that I'm canceling, is the Ivory Tower guys will talk about owning gold. Okay. Yeah, I know a little bit. Uh yeah, it's like they don't include any cost to carry risk premium. They go, oh, there's no cost to carry. The cost to carry is gold. It doesn't earn anything. I know, but you gotta protect it. How are you gonna move it? You're gonna move

five hundred pounds of gold and what and then they're gonna assume it's it's real. They're not gonna sit there and assay the fucking thing. They're not gonna take every single gold bar, which by the way they claim doesn't exist because there's this conspiracy and the gold isn't in the E T I mean it's like I I can't spend any more time with chuckleheads. I I have many years left.

Just look, look, look as the bloodbath in stocks occurred on Black Monday, gold initially climbed nineteen dollars or four percent to a high for the day of four ninety-one. But then the metal turned south. Yeah. Because you sell what you got. All correlations go to one. The other comment... The other newsletter, it's there's a lot of French guys who write at this place. And the senior guy wrote, He's gonna be spending his weekend thinking about

The new monetary system. I see this thing, I'm like, not a fucking chance. Right. Am I paying any money so some guy can sit on his ass and contemplate his navel about the new that The new mono you mean we're we were past Bitcoin already? That was gonna that was gonna cure cancer and put somebody on the moon and cure hunger and all these great things. But no Right here on this show, Hamas. That's the first terrorism, human trafficking, right?

We w we forgot about that. I know, I know, I didn't I know, I'm aware, I know. I don't mean to uh I just Oh no, you're right. You know, but it's uh it's gold. It's gold is frustrating. Gold will drive that that aggravation. I I I've been, you know, I they just beat me like a rented mule. I mean And you know, tonight we we had a headwind, it was like 40 minutes longer than they had the couldn't find the car when we got to the the airport. You know how that goes.

That's why I do I have an idea about that You know, it's not as much fun. I used to be able to track you and I used to have the tail number and I could see when you were home and I would be like, All right, he's home safely. Now I look up the tail and I'm like, Oh, Lancaster to Milwaukee. What's going on? No no no no no no no no we've We've uh we've ch changed our habits. Yeah, I know, I know, I know. I know. If network needs the tail number, I would provide network with the tail number.

It's another one of these great things. You know, um, I don't want to delve too deeply into it because I think I figured something out. Yeah. But You know how like people walk around with like the black card and it's like this big symbol of wealth and so I've been through this, I've been working through these numbers for twenty years. And anytime somebody tells me they got a nutjet.

Deal. All I think of is you stupid fuck. Stupid. Well, isn't that it's the most expensive way you can't possibly pay more than to get a share in nut chest. I could do an hour on how bad it is. But it created, it's created an opportunity in the private jet market, which I'll share with our platinum subscribers offline, but I I found a way to do this for substantially, shockingly less. Oddly enough, a Jewish guy with incentive figures out a way to make money.

Well you got the inside track. I would trust you on this. You have some working knowledge of what goes on, um, and you know what suckers are willing to pay to to fly the plane. And how many times have people asked you, uh, you know, can I borrow the plane? Like, how can I, you know, can I can you be like You'd be like, yeah, sure, call Tony. And they'd call Tony. And that was the last that they'd ever hear of.

Yeah. You know, it's like when we were doing it, we would send out quote number 15,432. And we have like 200 flights. Because the my favorite thing is somebody'd say I want to fly to Chicago um and I'm gonna stay there. Friday to Monday. Friday to Monday. Or no, stay there and like I'm going to college. Got it, got it. Yep. So we'd give them a quote and they'd be like, well, why is it so much? Well, it's two hours to Chicago and it's two hours back.

But I'm only flying to Chicago. I yeah, I know. But you gotta bring the plane. You gotta bring the plane back. You can't leave it there. What am I how am I supposed to get it back? That's on me? You're taking it there. You gotta bring it back. And that's eighty-five percent of the chuckleheads they call up, they think, ah, I'm just gonna get a one way thing. And yeah. And no. Yeah, no.

I love it, dude. I love it. I'll tell you the I don't know, this will sound obnoxious, but we're too far down the road to stop. Sunday. So this this weird situation that I become aware of, you it's almost like get your own plane. But you get all the benefits and none of the happens. But as a little Benny they throw to you, they give you free catering and they and free de icing. And in my world, boy, that comes in handy. Anyway, so they give you a menu of choices.

Are they catering? And you know, pick whatever you want. They're really, really nice about that. So I'll say to Cheryl, we're going to Florida. What do you want? She looks at the menu and she says, that is nothing I want. Yeah. Tell them what you want, they'll get it for you. Uh, you know, I don't know that I'll be hungry. It's it's free. It's free. Well, I know, but if I don't eat it, I'm gonna waste it. I'm like, honey, it's free.

Pick something. Yeah, yeah, yeah. Get an Italian combo. Like an Al Yeah, that's that's what my life is like. By the way, you know, I was a little concerned. Um, you know, Fiona busted into our recording session. Are we supposed to pay her? No, no. No. Work in the mine like I do on Monday, okay?

Let me um let me ask you about Monday. Let me ask you about Friday. Like talk to me about Friday. Like walk me through the day. Did you know it was coming? Did you where were you on Friday? First of all, were you traveling when when things were unfolding in your favor? Yes. I was on the plane. Plane had Wi-Fi, which was nice. Um But the problem with like the Muni stuff is it's not like futures or treasuries, it's like it it could be anywhere. So my Muni guys were

you know, sending me some updates. I think they were more relieved than I was happy because I was upside down on those things pretty good. Yeah, yeah. Still might be, but less so. Yeah. But um yeah, I think over time, you know, these things in in and our last call, I I told you some of the rate. I'm not gonna get hurt at those levels. I'm he and you know what, if they're gonna get me

And I'm gonna get six percent my money back tax free. Fine, you got me. Yeah, yeah. It ain't like I'm SPF up in uh you know, jail trying to make new friends. So um yeah I I I would have preferred spend more time going through the number and watching the market trade. But uh you know, I just didn't I just didn't have it. And but you know, the I was thinking a bit about This podcast that you and I do. And one of the things that occurred to me for the people who listen that are not in the business.

What's unique about this podcast, I think, is These are the conversations you and I have to a large extent are word for word the conversations we would be having on the trading deck. I mean, not so much about, you know, the Thoranos woman, although when you're it on the desk ten hours a day, you got a lot of time to talk. But, you know, we would talk about

You know, how does the yield curve look? Are munis rich or cheap? Are agency security is rich or cheap? How about volatility? What do you think the curve's gonna do? What do you think the payroll number is gonna be? And so

I know for me, you know, there's a thing about the internet, if it's free, you're the product. And you know, there's a lot of guys, and I guess this is why I, you know, I'm look I'm a little bit against the pay for the subscription, because those guys are making money. But it's part of their trading process. That's how they come to their decisions. And so to me It feels like

A little like you're double dipping. You know, if you if you get paid and you're wrong, well you didn't lose as much'cause you're getting paid and you're taking other people down with you. Here we Apparently people aren't getting the memo because we keep getting these requests for people to be interviewed on our show. Dude, that that dog don't hunt. We don't take a penny. No, we lose money. We loo we lose money. And uh

Because we want to have a a conversation and talk about the market and not worry about selling some stupid book, how I fucked the world over 25 years ago and what I learned. Boy, I learned so much blowing the world up. Rule none number one, don't. Yeah. Levers, those that was the that big basis trade. It was the big bad basis trade those guys operated, yeah. So the the the the funny thing about the Ken Griffin comment, I know you you sloughed it off so

Ken Griffin was telling the Fed that they should be looking at the banks about the basis trade. I just puff it off. I just mean It's okay. But here's the farce of the comment, okay? Tell what was the comment? What he said that he said they should be looking at the banks, not the heads. To the best of my knowledge. All right. I said, what is he supposed to say? You know, look over there. Well yeah, but the here's the problem. Banks are regulated entities, hedge funds aren't. So Hello?

I you know, why do you rob banks? Well that's where the money is. I mean I Yeah, no, I know. I know no, I you should be regulating the people you're already supposed to be regulating. Don't regulate us. We're unregulated. We don't need to be regulated. Like, is he that dumb? Dude, I mean he's He's doing it for a reason. He's he's not doing anything. He's not doing anything. He's key. That's a classic look over there to me. Like, you know, you Um yeah, I don't know.

Uh, what's your outlook going forward? Um, because the the you know, I know you're bored by the stock market, but the stock market reacted as if we're, you know, like hiking is done, this is it, we're off to the races, um, away we go. Oh I I you know, I hate to predict the stock market. I know, I know, I know, I know.

You know, I'm gonna go back to at a five percent two year note or whatever it is, you know, I I'm just parking my money there until They c crush them, if they crush them, and then I'm gonna see what Stand Us. He banned out Janet Yellen. He ripped Janet Yellen too. He said something he said she was the worst the worst treasurer since Alexander Hamilton or something like that.

No, stand it. Drucken Miller did stand it. Yeah. Yeah. You want to mention his quotes. He made he made multiple headlines this week. He said that. Per mon the monetary policy like during COVID like was the leaving rates at zero instead of leaving the long bond at X instead of the he's he's right. How do you not borrow money for 30 years at one percent?

I it there's just one word, obtuse. How do you how do you run the treasury and not understand that at one percent that's all you issue is longbox? That's it. Nothing but long bonds. And you know what? You push them back to two. You keep selling them. You push them all the way back to three. And maybe you get uh you know four trillion off, five trillion off. I don't know what the number's gonna be, but you're never gonna see that rate again.

And it's just the fact that they don't they didn't do that is like it's unconscionable. You know it's it's They're government officials so you can't sue them, but it it Talk about lack of fiduciary responsibility. It's just they talk they don't talk to you they talk to you guys back in the day, didn't they talk to you? They have this Treasury auction Yeah.

Advisory board? Yeah. By the way, it's filled with guys from hedge funds. I know it's Bill and everybody else. I know you can look it up. I know. Uh but but like be but in the real world, besides those formal meetings, like there's That's it. That's it. Fortress they would have occasionally now the I'm well removed. Okay. But there were occasions I went down to the Treasury, specifically during times of crisis, or the most notable one was 9-11.

You know, they needed to know how the money markets and the treasury markets were functioning. And, you know. I went. I did my duty. I gave them all the information they asked for. I was able to glean some stuff by the way they asked questions.

And I profited from it and was it inside information? Can't be,'cause treasuries aren't registered securities. Yeah. So and and it ain't like I made that, you know. But um But other than that, you know, I I'm not dialed in enough with, you know, uh there's a lot of these a lot of these guys spend a lot of time working the angles with the Oh, did I lose him? Let's see if I

Okay. I'm here. Good, good, good, good, good, good, good, good, good, good, good, good, good, good. All right. Um there was like a Smick Johnson letter that, you know, they had supposedly, you know, kinda like the inside read stuff. I you know, I've been too far removed from that. And maybe in in and just to finish the thought, you know, I've decided that that daily shot thing. That, a piece of paper and a pen, I'm good to go. The rest of this stuff, what somebody thinks about how the French.

you know, attacked something in seventeen eighty something and what it did to monetary policy or, you know I I I just I I I uncle, right? You know what? I I pay for my research. I don't pass it through to these investors. Yeah. That that's one of these other little known hedge fund secrets that the investors pay for that shit. I don't think it comes out of the management fee. All right. Well yeah, ten grand is okay. Well hey, it's only one trade, you know, if you read it

You're gonna make it back on one trade. Well, you know, I have five of these guys and so far, you know Maybe I think I'm oh for five. Frank. Print them out all your your receipts from all your gold options. Send it over to them and be like Look what you've done. This is this is me listening to you.

The money, the money. I can handle. It's the destruction of myself. The learning. What about the learning? It was tuition for learning, right? Didn't you learn a lot through that? Number one, the that comment about Peter McGarry about never screwing around with gold you don't know haunt you forever. Not only that, in this in the stock operator. He talks about how he had a position in wheat or something, and how he really either liked it or didn't like it. And he met like the famous wheat guy.

And he he kept saying to the weak guy, the wheat I'm making it up. The weed trade's bad. And the guy goes, no, no, no, no, no, no. It's just temporary. And he's he's looking at the tape and he's like, it trades like shit. It trades like shit. And the guy goes, No, it's gonna be fine. And he keeps buying it and the whole thing. And it it he goes broke, right? And so I remember looking at this gold thing and the implied volatility of the option was very cheap.

But I was watching it and I would say to you, I would say to Ed, I would say to EG, this thing trades like eight pounds of shit in a four-pound bag. And it Yeah, it's just I would I was right, but I was wrong because I was long and I lost money. So if I'm a newsletter guy, hey Bummer. Feel terrible. God, couldn't feel worse. No, I lost a lot of money. And my fault. My fault. I can remember being on a bike ride with you and like talking about

This was probably before Trump was elected. So we're going back like like fifteen or sixteen and like back in the day you were like there's a lot of things going on. Man, I don't know what it was, but it was like you would got you finally got everything that you wanted between like election unrest and like global unrest. economic like you got covet like he like covet happened and it still didn't yeah it still didn't go yeah go in my defense I picked a number yeah and I stuck to it now

Perhaps that number was a little too big. Okay. Hey, what are you gonna do? Nobody's perfect. Anyway, I'm getting a little hungry. All right, buddy. It was good to see you. Same here. That was fun. I uh you know we're running out of time winter's speaking of running out of stuff you got to get your shit together mister with your t-shirts okay you can't you can't get 10 t-shirts and then hawk it on the show and i got a hundred guys it's you got a hundred labels कर दो कर दो कर दो कर दो

They're asking questions like does he want FedEx or UPS? I said, let's do the the postal service. That's that way he can, you know, he can get the walker out and he can trudge he can just trudge up to the mailbox. Okay. So I got, I think, an order of like 75 larges. Okay. This is how it's gonna go. They're free, they're large, and they come in black. That's your choice. And then when we give you the go ahead, we can send

Um Liam, a prepaid whatever, label. Label, yeah, yeah. Now fold it nicely and shove it in an envelope. Yeah. Oh sorry, this complicates the things for the guys from from Australia because all the international Yeah, oh yeah, by the way, no international. That shit is scaled. You're out of luck. Maybe we should put'em up on eBay, see if we could sell them there. That was great. But that would violate our profit motive.

So all right, dude. I'm so glad that you had a good week. I'm glad you had a good time in Florida. Maybe you just need to go to Florida like once every every once in a while. Maybe every twelve years. Okay, goodbye. Have a good night. Thank you. All right, pal. Thank you.