Has Tesla doomed itself like many automakers of the past?

Chuck Zodda and Mike Armstrong discuss the market finally hitting a real record and why that could be a major problem in the near future. Tesla scaps low-cost car plans amid fierce Chinese EV competition. Apple lays off 614 workers after cancelling car project. Ford slows its push into Electric Vehicles. Paul LaMonica, Barron's, joins the show to talk about MicroStrategy and cryptomania.

Episode Transcript

(00:00):
The Financial Exchanges produced by Money MattersRadio and is hosted by employees of the
Armstrong Advisory Group, a registered investmentadvisor that provides investment advisory services. All
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(00:21):
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(01:02):
The DAV five K Boston is presentedby Veterans Development Corporation. This is the
Financial Exchange with Chuck Zada and MikeArmstrong a little bit after eleven. Here
it's Chuck, Mike and Tucker withyou. We got markets rebounding after a

(01:22):
down day yesterday. The Dow Jonesindustrial verage is up two hundred and five
points, The S and P isup forty three, the NAZECA up one
to seventy nine, so anywhere fromaout a half to a one percent rise
in major usn disease tenure Treasury isup six point four basis points, four
point three seven three. We've gotoil up forty two cents barrel to eighty

(01:45):
seven oh one. And that's notgreat for drivers or people who use plastic,
or really anyone who is alive today, unless you're in the oil industry,
then it's it's good for you.Or if you get a lot of
froudenhoyed about watching other people fill outtheir gas tanks when you have any Do

(02:05):
you mean to say it that way? How do you say you said froudenshoyed?
How do you say it? Well? First, the first layer is
the S the f party shouden freudyesh froudenchroid versus shouden Freud. Yeah,
this froudenchroid is something else, isit? No? I didn't think so.
Yeah. So unless you're one ofthose people that really gets a lot
of gratification about other people pumping theirtanks while you drive an EV, which

(02:29):
I don't. I have three gascars, so it doesn't really work for
me. And so the national avaturgas price is up to three fifty eight
and two tenths of a cent,continuing to rise off the three h seven
that it was at earlier in January, now up almost twenty percent year to
date, and that doesn't feel verygood. And we've got gold up twenty

(02:50):
eight ninety and ounce to twenty threethirty seven and forty cents, yet another
all time high for gold as itcontinues to surge even with yields rising.
So fair question asked, hey,what is gold telling us here? Do
you make anything of markets rallying afterthis job's report where we received this morning,
which by any way you measure,it was hotter than expected and wage

(03:15):
growth hotter than expected. I mean, granted, all markets I think finished
off more than one and a quarterpercent yesterday, so potentially just rebounding from
that sell off. But nothing aboutthis report seems to indicate rates coming down.
No. But here here's where Iguess I land on. This is
the FED in its last SEPID Summaryof Economic Projections said growth is going to

(03:38):
be stronger than we expect this year, inflation is going to be higher than
we originally expected, and we're goingto maintain the same policy of cutting interest
rates. Yep. So all elsebeing equal, if the FED is saying,
hey, we're not going to doanything and there's more growth showing up,
it's good for stocks. It mightnot be good for individuals' Let's talk

(04:00):
about this a little bit. IfI am a company Chuck Incorporated, which
I'm not, But do you thinkanyone's going on at that Probably Chuck,
Yeah, probably a beef company.Charles Schwab already has it. Probably probably.
In any case, I'm Chucking corporated, and I am selling my widget
for one hundred dollars. I maketen dollars on said widget if I can

(04:25):
go forward and a sell more widgetsbecause the economy is hotter, and even
if there's inflation, let's say theprice of my thing, I've got to
you know, my input cost goesup, so I got to raise my
prices to maintain my margins now insteadof making you know, I'm selling it
for one ten now instead of onehundred, and I'm making eleven bucks instead
of ten. My profit just wentup by ten percent and I'm selling more

(04:46):
of these because the economy is hotter. That's good for me as a stock,
because my profits are going up.Because profits are nominal, they're they're
not adjusted for inflation. And ifyou're a large company it's been around for
a while, you probably also areinto looking at refinancing your debt right now
because you did so back in twentyand twenty when rates were all low.
So I don't need to borrow anymore money at this stage. I've already

(05:09):
locked in my rates at three anda half percent for the next decade.
So if the FED is saying,hey, inflation and growth can run hotter,
yeah, for me as a company, that's fine. Now If eventually
it gets a little bit too hotin the FED has to say, chuck
you, you you've done it thistime, like things are too hot,
and then they got to raise rates. That's when you know you end up

(05:30):
seeing kind of the potential issue there. But if the message is yeah,
We're gonna let this economy grow andinflate, even if it's you know,
hotter than we want it to be. That that's not inherently bad for stocks.
Now for individuals, let's let's lookat I'm no longer Chuck Incorporated.
Now, I'm just Chuck, justChuck. Now, I'm a businessman,

(05:53):
not a business man. In thiscase, I'm making fifty dollars a year.
Okay, my costs go up byten percent because Chuck Incorporated raised prices
on Chuck. Even if my employergives me a ten percent raise, I'm
still just buying the same stuff withmore money, which is which almost precisely

(06:16):
in the aggree of what's happened overthe last three years, which makes me
feel bad because I'm like, hey, I'm making more money and I can't
get ahead. What gives? Sofor Chuck the person that scenario doesn't really
feel very good. And so thisis the delicate balance that the FED is
trying to strike, which is,Hey, what's the right level of inflation

(06:36):
and growth such that we can kindof, you know, grow our way
nominally out of some of these debtproblems and things like that that we have
without angering the masses too much.And the answer, in my opinion is,
hey, look, if you canget to like three percent inflation consistently,

(06:56):
like on average, not bottoming,but average three percent inflation and real
growth is two percent, most peopleare cool with that because that's basically what
it was in the nineties. Yeah, and give us some productivity gains so
that things feel better and that weyou know, our standard of living goes
up. Yeah, we're cool withthat. I think when you start seeing
things hotter than that, it startsto be a little bit dodging. You

(07:17):
start seeing numbers printing, you know, four percent higher four percent or higher
on inflation, and it's like,oh boy, this isn't gonna be good.
So that's that's where I think weare right now. But that's why
for stocks, as long as theFED doesn't change its tune, it's fine.
Not that this is where we are, But take a look at any

(07:39):
any stock market in the world wherethe local economy has experienced, you know,
like really rapid high inflation, andtake a look at that stock market
measured in its local currency, nothow it's measured you know, overseas with
exchange rate adjustments. But when there'sreally high inflation stock markets go to the

(07:59):
movie. And the reason why isbecause stocks are priced nominally. It's it's
that you don't adjust to stock forinflation. Where you get hit on them
is where borrowing costs go to themoon as well. But if you look
at you know, countries that experiencereally really high inflation, not like what
we did. You know, it'shigh, but it's still within the realm

(08:20):
of normality. You talk about placeswhere hey, we saw you know,
prices double in two years or somethinglike that, and look at what happens
to those stock markets before central banksget a handle on it and they go
through the roof because it's just,oh like, there's all this money that's
being made by companies because prices justkeep going up and up. In real

(08:41):
terms, those markets aren't making anymoney. But if you look at it
in you know, kind of theirlocal currency, just nominally, yeah,
they go up. So let's reiteratehere and driving home, we're not there
yet where to a point of ultrahigh or even high inflation comparison to the
last few years. Now. Theconcern is that going into this year,

(09:03):
everybody assumed that the inflation story wasdead and that The story of the year
to dominate was rates coming down,and I think for the first time this
year, over the last month orso, that's been called into question by
many market analysts and economists. Yeah, and so this is going to be
the next two months of data.I've said this for a while now,

(09:26):
March and April. Data that weget in April and May, this is
the ballgame for the year. Thisis the ballgame for the year. If
the data improves and we start gettingback on that, you know, it
doesn't have to be two percent,a two and a half percent path,
all right, we got something towork with here. Otherwise, the Fed's
got some egg on its face.And I haven't said that in a while.

(09:48):
I said, for sure, latetwenty twenty one through mid twenty three,
you know, the middle of thelast year, I was like,
hey, man, the Fed's notreally on the ball here. Back half
of twenty three, I thought theydid a fantastic job. Quite honestly.
Now I'm like, eh, youguys, what are we What are we
doing here? We're taking victory lapsin December, you know you. I

(10:11):
don't watch a ton of car racingI used to growing up, and then
do you guys, remember when uhIndyCar split from uh cart and open wheel
racing in the US basically died.No not something that I followed, No
I do, and uh after thatyou just and I never got into F
one for whatever reason, and blahblah blah. But here's what I know

(10:31):
about car racing. If you're doinga two hundred lap race, no matter
how far ahead you are, youdon't take your victory lap at lap one
nine because a lot of weird stuffcan happen in car racing. Same with
the economy. The economy is likea car race. And right now,
Jay Powell is just like, hey, I got ten laps left. I'm
just gonna coast, and Inflation's comingup from the back, like, hey

(10:56):
still here, Hey Jay, goodto see you again. Remember me,
I'm inflation I started a couple ofyears ago. Yeah, that's kind of
where we are right now. AndI don't know if you know inflation passes
Jay to continue with the awful metaphorthat I'm stretching now. But this is

(11:16):
this is what gives me, Thisis what keeps me up at night in
terms of the potential problems right now. It's not recession recession may come later,
it's not now. Yep. TheFinancial Exchange is now available on your
Alexis smart speaker has to play theFinancial Exchange and catch up on anything you
might have missed. This is theFinancial Exchange Radio Network. Text us six

(11:39):
one seven, three six two thirteeneighty five with your comments and questions about
today's show and let us know whatyou think about the stories we are covering.
This is the Financial Exchange Radio Network. An exclusive story breaking now from
Reuters that Tesla who has been uhindicating that they are trying to build an

(12:00):
entry level car priced probably somewhere inthe twenty five thousand dollars range. Remember
that their current Model three is ifyou look at the pricing, I'm just
pulling up, you know, kindof where it is without any incentives or
anything like that. Current Model threebase at the moment is priced at Come
on, where are you no?Give me the purchase price thirty eight nine

(12:24):
to ninety is where it currently stands. So not exactly a mainstream discount car,
I think no. I think it'sit's something serious truck, but it's
it's within it's within like the targetrange for the mass affluent family that's making
you know, one hundred thousand toone hundred and fifty thousand a year,
but not the family that is belowthere obviously. And the idea was,

(12:48):
hey, we want to build acar for you know, the the masses.
That is, that's cheaper. I'mgoing to quote here from Reuters.
Tesla has canceled the long promised inexpensivecar that investors have been counting on to
drive it growth into a mass marketautomaker. According to three sources familiar with
the matter and company messages seen byReuters, the automaker will continue developing self
driving robotaxis on the same small vehicleplatform. The source says, Okay,

(13:15):
so this is something that I don'treally know how to say, so I'm
just going to say it. Idon't know what the path is for future
growth for Tesla. Then you can'tsell. You can't continue to grow at

(13:35):
thirty forty fifty percent a year sellingvehicles that are priced the way they are,
Like the cyber truck. Already didit. They've been sold. That
customer has been sold to correct andthey might come back and buy another one
later, but that's you know,ten years down the road or whatever it
is. So if you're trying tofigure out, you know, the path
here for them. They are agrowth company that is no longer growing,

(13:58):
and they need to prove that thatis not just a one time thing for
this quarter, otherwise the stock pricehas the potentially get fairly ugly, fairly
quickly. I saw elsewhere Electric reportedyesterday that the inventory that they just had
to put out there on their modelwise was in the tens of thousands.
And you're seeing discounts as as muchas seventy five hundred per vehicle on some

(14:24):
new vehicles, let alone the usedcar market for their this is the model
why is their SUV version of theirelectric vehicle, And across the board you
seem to be seeing price cuts toincentivize sales and then to your point,
killing a business unit that was supposedto be the future growth engine and the

(14:45):
piece on this that matters. Sothey're operating margins in the as of trailing
twelve months in December of twenty twowas seventeen percent. By the end of
Q four was down to nine percent. Those margins are going to keep coming
down. You start having fitability questionsprobably by the end of this year.
If this continues. I mean that'swhere they are. They're not there yet,

(15:13):
but you probably start having profitability questionswithin the next twelve to maybe not
by your end, twelve to eighteenmonths, you probably have them. Again.
This isn't to say that it's acar company that can't make money.
That's not I don't think what anybody'ssaying, although they they are trying to
do so. I'm saying that ifthis continues, that might be what they

(15:35):
are. The bigger point that Iwould make is, very recently their stock
was being priced as more valuable thanwas it every other car company in the
world combined. Yes, self drivingrobotaxis. We've been hearing about this for
almost a decade. They were originallyElan originally said they were going to be
out by twenty eighteen. It's twentytwenty four now and we're still talking about

(15:58):
this. I mean like we're kindof starting to run up against it again.
They're not going out of business anytimesoon. Let's not jump to anything
crazy. But if you're having toput fifteen to twenty percent discounts on your
inventory to sell them, and yourprevious profit margins were nine percent, that

(16:19):
means you will be selling those vehiclesat a loss, which is not something
that you can do and still beprofitable. That's how math works. So
that's kind of what I'm looking at, which is, hey, you better
get your cost structure down otherwise youare going to have some profitability questions.
They do have thirty billion dollars incash and short term investments according to their
latest filing, So again, thisis not a going out of business thing,

(16:42):
at least not a short term,but it very much is. Hey,
the whole premise of Tesla was it'sdifferent from every other car company.
It's starting to look a lot morelike every car companies, which, again,
you could run a fine business thatway, but you probably can't be
a five hundred billion dollar stock anymore. Yeah, they raises a lot of

(17:07):
questions about the future. Again,I think more of this stock price than
of the company and the vehicles,because I have a tough time believing I
won't be able to find a Teslacar five ten years from now. But
again, for a company that makescars to be priced more valuable, more
valuably than every other car company combined, seemed a little weird in the moment.

(17:30):
Taking a look at markets as wehead towards. By the way,
Tesla on this news here now downfive and a quarter percent today. Until
this they were basically trading flat.So this news has moved the stock by
about five percent or twenty five billiondollars in market cap in the last twenty
minutes. So it's not just mesaying this is bad for Tesla. This

(17:51):
is the market saying, hey,this could be bad for Tesla. Bringing
the latest financial news straight to yourradio every day. It's the Financial Exchange
on the Financial Exchange Radio Network.Missed one of our shows. Catch up

(18:12):
anytime by asking your Alexis smart speakerto play the Financial Exchange. This is
the Financial Exchange Radio Network. Applelaying off six hundred and fourteen workers after
canceling their car project not surprising.Yeah, these were people that were working
on building an Apple car or designingor figuring out how they were going to
tonapp Apple car, and presumably thatskill set does not translate quite as well

(18:37):
to Aim robots. I guess theysaid that they were going to repurpose these
people for AI. Yeah, sothis is We're covering a lot of car
stories, not just today, butrecently, Tesla has been in the news
a lot. And the big trendthat you seem to be seeing is all
the excitement over self driving cars andelectric vehicles over the last five to ten

(19:02):
years. It's dead. If notdead, then dying right Like the AI
is just sucking up all the oxygenin the room. And so you're not
getting any hype over EV's like youwere very recently, like twenty twenty one.
Remember all of those SPACs that weregoing to make more money selling electric
vehicles than anybody ever under do Ido? Yeah, not many of them
really talking about that much anymore thatmany of them going out of business.

(19:23):
Ford also slowing it's push into theEV space. They said that they would
delay production of at least two newevs and pivot to making more hybrids.
And I maintained that the plug inhybrid in particular is the way that you
can get the best of both worlds. It really kills like eight birds with
one stone without killing any birds.Yeah, I mean think about what you

(19:47):
can do. You get the EVbenefits for short trips, which obviously is
something that you know. Anyone who'sdriven in EV you you know the feel
of it's nice and it's nice ridein everything. Sure on top of that,
you get the environmental benefits. Youalso get the ability to have longer
overall range through the combination of thebattery and gas powered engine. You have

(20:08):
multiple ways of filling the thing up, so depending on where you are,
you can actually arbitrage and choose what'scheaper if you want to, quite honestly,
and it allows you to improve theoverall fuel economy of your fleet without
having to push everyone towards a onesize fits all. Ev I freaking love
plugging hybrids. Man, Yeah,says a Tesla owner. The other thing

(20:30):
that you can do, by theway, is you have the ability to
tweak that hybrid to whatever you needto do for the particular use. So
if you have, you know,something where you're saying, hey, I
got my small car like the Priest, and I really want to maximize gas
mileage. Great, you tailor howthe hybrid works to do that. If
you have and I'm using Toyota herebecause they have the most of these,

(20:52):
they also have a version I can'tremember if it's of their Tundra Tacoma.
I think it's their Tundra okay,where they have a hybrid in it,
but the electric battery is actually usedin the electric motor is used to just
generate more power and torque more rapidlyso that you can actually pull more and
tow more more easily, so youcan tune it for whatever you want the
particular used to be, and Ithink that's cool, folks. We have

(21:17):
a brand new guide for the monthof April of this year, all about
preparing for an upcoming retirement. Ifyou or someone you know is facing this
down and might be looking in thenext five years at pulling the trigger here
and getting ready to move on fromtheir career, there's a lot of preparation
that goes into it, I thinkfirst and foremost. We always talk about

(21:37):
the budget and how to plan,and there's all sorts of rules out there,
like I'm gonna need eighty percent ofmy income compared to when I was
working. Those are all great rulesof thumb, but don't tell you anything
about yourself. There are a numberof key steps that we suggest people take
a look at when it comes toevaluating their readiness for retirement, and this
guide points to all of them.What are you going to be or in

(22:00):
sources? Have you thought about apension or your social security? In terms
of how that's going to impact youroverall plans. What's your social security declaring
strategy? What if you have agovernment pension and how will that interact with
your social security? And then certainlyimportant to talk about when markets are near
all time highs, is my portfolioactually set up for a coming retirement,
given that it's going to be probablythe first time in your life where that

(22:22):
is going to start getting spent downinstead of accumulating. If you have questions
along these lines about how to preparefor your own retirement, we've got the
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(22:47):
call our offices and we can emailor mail you a copy of this as
well. The phone number is eighthundred three nine three four zero zero one,
So i'll give that to you againone Armstrong Advisory dot Com or two
eighth hundred three nine three four zerozero one. The proceeding was paid for
by Armstrong advisory group a registered investmentadvisor. Nothing in the ad or in

(23:07):
any Armstrong guide a specific financial,legal, or tax advice. Consult your
own financial, tax, and estateplanning advisors before making any investment decisions.
Armstrong may contact you to offer investmentadvisory services. Mike, have you ever
been to the Pump Jack Cafe inOlympic Valley? I've not. No,
it's in Lake Tahoe, and I'llquote from their own website. Pumpjack Cafe

(23:33):
is widely regarded as Lake Tahoe's premierdining destination. It's also partly owned by
Gavin Newsom, the governor of California. Fancy that they posted a job listing
at sixteen dollars an hour, eventhough California requires fast food workers to be
paid twenty an hour. Now,this obviously is not a fast food restaurant.

(23:56):
But if the governor signs a billsaying, hey, I want to
raise the wages of dining workers inmy state, but then the very restaurant
that he is a partial owner ofsays, no, I'm not going to
pay that wage. You not requiredto. I'm not saying they're doing anything
illegal, it's just very unseemly.It's kind of like, hey, twenty
bucks for thee but not for yeye yeah. I mean, look,

(24:22):
does Gavin Newsom have anything to dowith operating this restaurant. Of course not,
it's in a blind trust. Hissister operates it. But I do
believe that he's generally aware of thefact that he has an ownership interest in
a restaurant that's not subject to thesame minimum wage rules and maybe just optically,
pay twenty bucks an hour might bea good idea. Again, he
has no right to influence any youknow, pressure on this restaurant to do

(24:45):
so, because that would be probablyeven worse. But yeah, optically,
when you have set up this newboard that is driving up wages for fast
food workers everywhere, and then you'refine dining restaurant as wages starting at sixty
dollars an hour, it's just it'sa little bit funny. It is.
Yeah, again, no economic impact, but man, that is that is

(25:08):
not a great look. Gavin Newsomhas just had a tough time with restaurants
the last four years. If youremember, back in early twenty twenty,
during the throes of the pandemic,he was spotted at the French Laundry when
Yeah, which is like one ofthe most upscale restaurants in the country.
I think when he was basically saying, hey, don't go out to dinner.

(25:30):
Yeah. So it's been a toughfew years for Gavin and restaurants.
Let's take a quick break here.When we come back, we're joined by
paul A Monica from Baron's Right afterthis business and financial news affecting the markets
and your wallet. We've got itall straight from Wall Street right here on
the Financial Exchange Radio Network. TheFinancial Exchange Show podcast drops every day on

(25:53):
Apple, Spotify, and iHeartRadio.Hit that subscribe button then leave us a
five star review. You're listening tothe Financial Exchange Radio Network, Ladies and
gentlemen the weekend. The Financial Exchangeis a proud partner of the Disabled American
Veterans Department of Massachusetts. This year'srace is Saturday, November ninth at Fort

(26:17):
Independence on Castle Island, and registrationsnow open. Help support these great American
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(26:37):
need. For more information and tomake a donation, visit DAV fivek dot
Boston. The DV five K Bostonis presented by Veterans Development Corporation. We're
now joined by mister Paul Amonica fromBarons here to talk a little bit about
micro Strategy. Paul, how areyou today? Good? Thanks? How
are you guys doing great? Somicro Strategy up around one hundred and seventy

(27:02):
percent in the first quarter of theyear. What what do they actually do?
Yeah, that's a great question.I mean, this is a software
company, but the software revenue andearnings aren't the reason that people are buying

(27:22):
this stock. Micro Strategy, whoseexecutive chairman is Michael Sailor, who's very
active on x and other social mediaplatforms, talking about how bullish he is
on bitcoin and crypto. Micro Strategyis a company that owns a large amount
of cryptocurrency on its balance sheet.At last check, the you know,

(27:42):
the holdings were worth around fourteen tofifteen billion dollars based on where current prices
are. So I think people areviewing micro Strategy more as a bitcoin proxy
than as an enterprise software company worthowning. And that's why you have this
research firm, Carristel Capital that recentlysaid you should just short MSTR and find

(28:07):
other bitcoin related investments to go alongon. Well, I guess this is
the question that I would have,is is there any advantage if you're you're
looking at it just as kind ofa bitcoin proxy. Is there any advantage
to owning micro Strategy as opposed toany of the new bitcoin ETFs or just
bitcoin on a crypto exchange? Exactly? And that is the point that Carrostel

(28:33):
Capital is making. Why own MSTR, which is a software company that based
on traditional valuation metrics for price toearnings, price to sales is stretched.
To put it mildly, you don'tneed to own MSTR to get your bitcoin
exposure because, as you point out, you can to open up a coin

(28:55):
base account and just buy bitcoin directly. Through there, you can buy one
of the numerous spot bitcoin ETFs thatare now available from investing powerhouses is like
Blackrock, Eye Shares and Fidelity.So it's much simpler for a retail investor
now to gain bitcoin exposure if they'rebullish on crypto and not necessarily have to

(29:18):
do it through this back door ofmicro Strategy. Doesn't this also present though?
Let's say that a bunch of peopledecide to short the stock and it
goes down significantly. Don't you endup with an arbitrage opportunity just because the
value of the bitcoin may be worthmore than the market cap of the stock
at that point. Yeah, we'renot there yet, because micro strategy is
market cap still exceeds fifteen billion orso by a pretty wide margin. But

(29:44):
I think you're right. If enoughpeople follow this advice and actually short MSTR,
you could eventually reach a point wheremicro Strategy would look like a compelling
value if the market cap no longeris higher than the amount of bitcoin that
they have on their balance sheet.The one issue I think though, that

(30:06):
I think is very risky with whatCarosseel is recommending. I agree that micro
Strategy is probably overvalued, but whenyou look at how micro Strategy and Bitcoin
have tended to trade, it's beenin tandem because of micro Strategies heavy exposure
to bitcoin. So it's hard toimagine a scenario where MSTR would necessarily decouple

(30:30):
from bitcoin and other cryptocurrencies because youknow. Again, let's be honest,
no one is buying micro Strategy becausethey think the software is fantastic. I
mean, it's not a knock ontheir software. It's just that the revenue
and earnings from the core business palein comparison to the crypto exposure they have.
But what kind of software do theyactually make? Yeah, just enterprise

(30:53):
software, so big businesses. Okay, you know, I always see him
talked about for the bitcoin p ButI just I don't know anything about their
software business, actually, Paul,are there any other companies that are in
a similar boat where they've got anasset like this that is driving most of
the value and the core businesses not. Yeah, I haven't really seen that,

(31:15):
per se. I mean you couldargue that, you know, DJT,
which we spoke about last week,is you know, obviously a stock
that trades more on the political potentialrise and fall of Donald Trump in the
polls and chances for him to beatJoe Biden in November. It's not necessarily

(31:36):
trading on the fundamental strength of truthsocial and Trump Media's core business. That's
obviously not you know, a cryptorelated story. But you know, we
definitely have I think micro strategy couldbe described in some respects as sort of
a meme stock, similar to DJTand GameStop and AMC of a couple of

(31:57):
years ago. Very good, Paul. We appreciate you joined into joining us
today and I hope you have afantastic weekend. Yes with you? Yes,
that is Paul Monica from Baron's talkingabout micro strategy. Mike, what
do you got for me? Uh? TikTok is really trying to pull out
the American heartstrings here, turning tonuns out or pull out at nuns,

(32:22):
veterans, and ranchers in their mostrecent marketing blitz. Pretty diverse group that
they're going after here to uh toto try and defend their position here.
So you've got a nun in northernNew Jersey who is speaking for TikTok about
a community she's created where people canfeel safe asking questions about spirituality. You've

(32:45):
got a patriotic Kenny who's a Navyveteran, and a rancher who are all
big TikTok fans and don't want thegovernment to know. This feels like I
set up for a joke. Itis not. It does. And a
nun a veteran and a rancher walkinto a bar. No, they are
all being hired by TikTok to runads in support of their platform because of

(33:07):
concern that Congress is going to bein it. Which, by the way,
what happened to that it's sitting atthe Senate dead? Well, I
don't know if it's dead. Yeah, they're just not talking about it.
Just it's sitting there. The paper'sprobably right there. If you walk into
the Senate, it's like, oh, there it is. Send a follow
up. So I'm sure that thereare many diversity your Senate. Just checking

(33:27):
in. I wanted to see whathappened with the TikTok. No you've been
busy lately. If they've been inrecess, please advise they might have been
in any case, I haven't heardanything on a potential TikTok ban recently.
Clearly TikTok is trying to basically runout the clock on this. Yeah,
make sure it gets to the nextadministration, so hopefully somebody else has to

(33:52):
figure it out. But yeah,I recognize that there are plenty of vested
interests here, but I continue tosay that I think the risks probably outweigh
the benefits taking a little at markets. I don't know why we just had
the last two days. The Dowis up three hundred and seventy one points,
the S and P's up sixty three, and the Nasdaq is up two
hundred and thirty, almost reversing allof the losses from yesterday. At least

(34:13):
on the S and P. Theyhave the Nasdaq, they have the Dow.
Not quite so I just I don'tknow what we're doing here. I
do. I know this is howmarkets work, but it's just kind of
funny when you know, after yesterdayyou get all the people saying, oh,
is this the start of something big, and then today it's like,
Nope, not yet. Maybe soon. Ten year Treasury is also up six

(34:34):
basis points to four point three sevenpercent. Hope everyone has a great weekend.
Enjoy the basketball games. Remember wegot an eclipse coming on Monday as
well, So uh, where yourreally really good sunglasses? And uh,
we'll see you Monday.