‘Flight to Crap’

Published Aug 27, 2021, 7:47 PM

Extraordinary loose monetary policy has led to what Interactive Brokers Chief Strategist Steve Sosnick calls a “flight to crap,” or investor interest in the most-speculative corners of financial markets. He discusses how the likely reduction in bond purchases by the Federal Reserve could affect those investments. He also shares his thoughts on how algorithmic trading strategies interact with meme stocks and delves into other market topics.

Mentioned in this podcast:

Powell Says Taper Could Start in 2021, With No Rush on Rate Hike

U.S. Stocks Rise on Powell’s Dovish Taper Tone: Markets Wrap

What’s a Taper, and Why Is the Fed So Focused on One?

Wall Street During the Pandemic: The Impossible Is Now Commonplace

Support.com Surges 400% in Meme Army’s New Short-Squeeze Attack

Hello, and welcome to What Goes Up, a weekly markets podcast. I'm Mike Reagan, and I'm a senior editor at Bloomberg, and I'm dannahark Across, asset reporter at Bloomberg. This week on the show, well Mark, it's got a few curveballs thrown at it. Geopolitics is front and center again in the news as the evacuation of Afghanistan turns deadly, and policymakers at the Federal Reserve are starting to make it clear that they're ready to start dialing back the liquidity that has been so crucial to the bull market over the last year and a half. What's it all means for financial markets. Well, we'll get into it with the chief strategist at a major brokerage. But first, Vildanna, I gotta tell you it was a big week this week because our old pal uh Sarah Hanzac actually re emerged on television. Did you did you catch her appearance? I sure did. It was really an exciting day. It reminded me of how smart and well educated Sarah is, Vildona, But as I she knows the one big gaping hole in her education that I pointed out to her many times is old man movies. Um, she hasn't seen any of them. Whenever you get two old guys together in a room, at some point, they just lapse into another language that is nothing but quotes from old man movies. And I gave her a list of movies to see so that she could understand guys like me. I think you tweeted it out once, right, I did? I did? Yeah? Yeah? Actually, John and John author has wrote a calm about it. Uh not everyone's a fan of the old man movies. I know your generation maybe it's kind of sick of us old men, But I do think it's important in your job to know the old man movies. I'm gonna give you a list too. I think you should. You'll actually watch them. I think Sarah kind of pretended like she was gonna watch them. If you give me a list, then I'll treat it as homework and I'll watch them. Okay, good? And now well we can play stump Fildonna with some old man movie clicks. I'll give you one today. Let's see if you can get this one. You ready? Their nihilists, man, they keep saying they believe in nothing. Do you get that one? You need me? Repeated crickets over here. But I have a feeling our guest knows exactly what you're talking about. Do you think let's find out. Let's find out. Well, we're joined today by Steve Sosnik. He's the chief strategist at Interactive Brokers. Welcome to the show, Steve. It's my pleasure to join you, Bill, Donna, and Mike. You can call me dude or his dudeness or l doin no, which Mike knows immediately what I'm talking about. And you don't have the slightest now I know, the big Lebowski. There you go a just not good quotes. I get half a point. We're impressed you caught it at least on the on the second reference. Sorry, that's good. That is impressive, Steve. Let's get into it though, I you know, talk about a sudden uh drama in the news with this Afghanistan situation. I mean it's it's obviously a heartbreaking situation from a humanitymanitarian standpoint, and I know, you know it's can be awkward to talk about that type of thing as it relates to markets. But um, such as our our fate in life, I guess so, um, you know our thoughts and simpathy to everyone affected by that. But um, UM, I do think our listeners probably are curious, um if this eventually has uh the chance to to be a catalyst in the market. You know, I for me, I can't really draw a straight line from what's going on to sort of any fundamentals in the economy or in the market's. Maybe oil gets a little jittery in those markets, but you know that doesn't always stop the market from having sort of a knee jerk reaction to this sort of thing, especially on Thursday this week, as it the bombings happened, and there's reports coming in as we tape right now, some some Marines being killed in the bombings. Is this a market potentially a market moving event? Do you think, um, either in the short term or in the long term, if this sort of affects the US standing geopolitically with other um situations around the world, well, as tough as it is to deal with, it's as a market moving event. It's it's really an outlier, you know, think of it this way. And I don't mean to minimize what happened today by any means, but the last week and a half two weeks in Afghanistan has been you know, pretty much an unmitigated um set of scenes of of of nightmarish looking you know, nightmares looking setups. And you know, the thought is as it like Psigon or whatever. Bottom line though, is the market didn't care. And for better or worse, this is not you know, the markets, I will say, I think the people in the market's care. But ultimately, when you get down to it, it's not. Afghanistan is such an outlier to the world economy. It doesn't contribute much in the way of GDP if anything. You know, their main export at this point is opium poppy, which is really outside the you know, the framework of the economy. And so if if we have to think in the terms of what does this mean to earnings and cash flows or whatever, it doesn't um And that's why that that's why the market reaction is has been muted in that regard. Yes, the markets sold off on that trigger. I think markets just don't like anything any sort of terrorism that because that's that's a more visceral problem. But in terms of a widespread economic thing, perhaps there's a geopolitical answer answer in there. But um, you know, I think I think in the world of day to day trading and short term investing, it's just not there's there's not a clear cause effect in terms of what's going to move a market. And I think Steve the through line here is that the market has been able to look past so much. I think a lot of people refer to the market climbing, you know, the wall of worry, and you know, we keep hitting record high after record high. I think the big question is how much longer all of this can go on for? And I'm hoping you can share your thoughts. Well, I think we'll get some clarity on that. Regard um this this weekend, um, you know, as the Jackson Hole Conference proceeds, you know, Friday, Saturday, UM, you know, we're we're as we're taping this now. I think they're you know, they're having drinks on the patio, you know, virtually or those who or those who had nonrefundable tickets, you know, in hotel reservations are um. But you know, I think that the key is this has been a very liquidity driven market. I think that somehow the market has markets have still really not come to grips with the fact that the FED is really talking quite seriously about if not not necessarily tightening, but taking their foot off the accelerator. And you know, I wonder if even just the act of taking their foot off the accelerator. You know, I don't love to use the term taper tantrum, but you know, I think that we've gotten We've gotten to where we are in a wide variety of risk assets because of the relentless accommodation of the FED and too and certainly to some extent of the fiscal accommodation as well. Um and I think that the market is going to have to reckon with this, and I think stock investors will probably end up taking their cue from the bond market, because quite honestly, bond traders are better at this stuff than stock traders. Fair enough. Fair enough, they certainly watched the FED a lot closer than than most of the stock traders I know. But Steve, I was joking about the nihilism and the nihilists at the beginning, because you had a funny quote in some of our email traffic before this, uh, reacting to a story, and not to talk our own book, but I will talk her own book of Eldon and I wrote a story about sort of, as she said, sort of the wall where or just the the the basic unknowable nous if that's an actual word about the economy and the markets and what's coming next in the age of COVID and in the age of all the stimulus throne at it, and I wonder, you know, and you you would sort of describe it as as a nihilist market, which I like that a lot, uh dude references aside, but I wonder, you know, obviously the FED liquidity is a huge part of why that phenomenon exists to some degree. There's a lot of money slashing around looking to find a home. Um, how important is the dialing back of that when the fiscal side of things has been so aggressive to um and and not only just the fiscal stimulus that the spending, but just you know, the amount of savings that the consumer in America has had over the past year, those of us lucky enough to keep our job or you know, be able to whatever reason, boost our savings rate. The the American savings rate just went through the roof. There just was not a lot of things to spend money on. So in some ways, does that sort of uh make the tapering maybe less problematic than it would be otherwise if we didn't have this this aggressive fiscal and you know, economic based liquidity on on the other side, outside of the federal reserve. UM. I think a lot of it has to do with how those savings are deployed. UM. I think if you and you know, I think if those savings, first of all, if those savings were used to pay down debt um, you know, if they were used to refinance mortgages, UM, if they were used to pay down credit cards, UH, the individual's balance sheet is in much better shape and thus able to withstand it. If you then too, if, on the other hand, you took all your stimulus money and refinanced your house and bought um, you know, doach coin, I would say that you're I would say that your financial standing maybe a bit more UM tied to the outcome of Jackson Hole. And I think you know, if if you if you've used those if part of the savings, you know, the improvement and balance sheet is because of the wealth effect from you know, stocks going up. Let's say you just did something and let's say you just brought SMP index funds. You're you're you're doing what quite well. Um, if the market reacts poorly, you'll get a draw down. You probably won't get the full draw down to what we saw last March, um, you know, and so that's really where it comes. I think. I think the problem you have is when monetary policy is extraordinarily easy, you get a lot of a lot of that money flows into incredibly speculative, not necessarily particularly productive assets. I'll call it a flight to rap for lack of a better word. And I think that as part of this, you know, if you own, if you own the really the stuff that's way out there on the risk curve, that's where you're that's where your most susceptible to to the to the bigger draw down. I do like to think that we that the vast majority of Americans will end up in better shape as a result of all the things you said, But inevitably there will be there will be some who got out way over their skis, and and it's gonna stay. I think we have our headline with flight to crap. What do you think I like it, Steve, I'm actually working on a story that touches on a bit of that, where uh, as you know, I cover cryptocurrencies as well, and when I'm talking to people, a lot of them say, well, there is just so much money in the system. You had people receiving the stimilar as checks during the pandemic, and so it just makes sense that you would see even some of these, like smaller alternative cryptocurrencies gaining. I wrote a story about n f t s. Some of them are put droopling in price over just a couple of days. So I know you. I did my homework. I know you. You have written about blockchain technology recently. So I'm wondering if all of that makes sense to you, or if maybe you're seeing something else where you describe it a bit differently. Well, you know, those of us who those of us who can reference eighties movies I've seen. I've seen this movie before, which was the late nineties where you were you had, you know, the advent of the new technology being the Internet, and you know, and and I'll use blockchain as an analogy to that, and the blockchain. We don't know what blockchain is capable of, just as the you know, the original internet um was basically just a way to send messages, you know, around so effective. It was just an email protocol, and now it's so much more, um, you know, and it's it's it's pervaded all aspects of our life. Um. And the problem that I have is, you know, not all the the Internet was a huge winner. The Internet bubble was was clearly a bubble in hindsight, the result of you know, the result of an easy of an easy fed, particularly super turbo charged at the end by the y t K problem and then sort of you know, came apart when when the fed, when the fed withdrew some of that liquidity. Um. And that's why I wrote earlier this week about um, you know, is bitcoin Cisco? Is it pets dot com? What what is it? You know? And I would argue that, you know, doge coin is probably more like pets dot com, where it's just clearly what are these people doing? They know it's a joke, They've admitted it's a joke. Every you know, except that there are you know, a couple of very prominent billionaires who say the right thing is when it when it needs to go up every so often. And I'll leave them nameless so I don't get sued. But um, but that's really you know, and my analogy I kind of do the takeaway of, you know, some of the cryptocurrencies will be something, will be Amazon, you know, and it will just be this huge winner, and it may not be what we think it is. If I had to put my money on one day, it's probably either or not ethere I'm sorry, And I actually do not own any cryptos right now. So um, and so that would probably be the long term winner. I think. I think bitcoin my analogy of Cisco, which was the Internet would not exist without Cisco, you know, with all the switches, the wires, etcetera. And the market the market got that part right, except for the fact that they wildly overpriced it and it never you know, never really recovered from from those from those bubble days, and so and so that's the problem. And so that you know, and and so and once you start really getting into the permutations, who's got the money for n f t s. Well, the money for n f t s comes from the people who made the money in crypto, and so now they're looking for something else to put it in. Um. This is that's like literally the epitome of too much money chasing too few goods. Another thing I often hear is exactly what you're describing. Where the money is moving maybe from some of the original or bigger cryptocurrencies towards smaller cryptocurrencies, towards defied towards n f t s, but then also meme stocks. And I know we saw a resurgence in some of the meme stocks this week. What are you seeing there and what do we make of the continued uh in investment and interest on the part of retail traders UM. You know, it's interesting because we you know, we do keep track of what our customers are, you know, are sort of our most actively involved in an AMC has been at or near the top of that list for weeks, you know, sort of the top five, top ten. So the meme stocks never really went away. I have sort of put forth the idea that there's a rotation that goes on between meme stocks and crypto and I think it was very interesting that the day that UM bitcoin pulled back from the fifty level was the day that that the meme stocks returned UM you know, and had their flash. I think a lot of what goes on in either event is just you know, the sellers walk away, you know, if you're how many times if you're you know, if you're a market maker, whether it's stock or options or just you know, a two sided trader, if you see that at this point you've come to notice that if there's the freight train coming in g M E or a M C or any of those things, Um, you know, I'm out of here. I'm stepping back. I'm really cutting back. One of one of the little market maker tricks, which I can now talk about since I'm not actively market making, is you know, one of the things when when your market making is we used to have a sign up and it was, you know, more or less when it gets bad, reduce size, widen widen markets and reduced sizes. Well, what does that mean? That means you're providing less liquidity at every given tick, and so you hit these liquidity air pockets in the meme stocks because everybody because it's self reinforcing behavior. And so I do think though, going back to your question, I think I think you do see it's it's if not the same cast of characters, it's it's a similar cast of characters. And and and actually what it means to me is there's probably a fairly fine heite amount of money that's being allocated from one to the next, and so I do think they rotate from one to the other. I think it's quite telling that other than Robin Hood, we don't really have any new lasting additions to the memes stock to my meme stock page. And yes, I do have a meme stock page on my market minder, um as I'm sure you do too at this point. Um, you know, other than Robin Hood, which which essentially is the you know, I use the Cisco. The Internet wouldn't exist without Cisco, it's not I'm not sure that the meme stock bubble would exist without Robin Hood. Um. And so you know, they're integral to it. But beyond that, it's not like there's this new class of stocks that developed memes and and I find that there's a lot of fragility there because these are they now in some cases have huge market caps relative to the business that that that underlies them. And you know, it's it's I fear that you get to a moment where it's like, you know, Wiley coyote chasing the road runner and he runs off the cliff and he still keeps running, but at some point, like he looks down and you know, down he goes. And I'm not I'm not wishing that, I'm not predicting that. But it's the longer you stay it really really high valuations relative to relative to fundamentals, the greater the likelihood that that could happen. We're gonna put the road Runner on Bildonna's list to it too as well. But it's a shame to me, Steve to hear you say that these stocks are on the heavy volume list. For you guys, it's because I picture I d k our clients to be. I don't know more of the professional sophisticated set than say it's say a Robin hood, which leads me to believe, I mean people are trying to figure out even the pros I guess they're trying to figure out what to do with these things. Um. And you know, forgot like you who has a background and now goo trading. Um, how does an awgo sort of trained brain approach these things? And I know there's been a lot of work done to try to sort of quantify the sentiment on social media and that sort of thing is that is that the main focus of sort of anyone trying to trade these from a quant or an algo type of perspective is is trying to you know, not have to read every post on Reddit, but try to somehow quantify what's going on. I think that's that's one way to do it, is try to quantify it and see if you can see if you can you know, read in sentiment. It requires a bit of natural language processing, which some people are better at than others. And the simplest algory, of course, is just momentum, you know, trend following and seeing that um, you know, which which um you know is there volume? I might seem volume accumulating at higher and higher prices, which leads me to believe that that that the freight train might be might be gaining steam. Um. And at what point, you know, or at what point does it seem like the volume is petered out? I will say the half life of the meme rallies seems to be shrinking. Um, you know, we're the one that we saw earlier this week kind of petered out relatively quickly, did They didn't give back everything, but they just sort of it was a one day wonder rather than rather than a lasting for any period of time. Um, you know. The but but also also in your question, it's sort of implied that you know, you're surprised that a lot of the customers are doing this, but we have, we do. I would say that we have a more sophisticated customer base than than average. You know, I think a lot of times, even though we have a high retail component, most of our accounts are in fact UM some sort of institutional in terms of money, certainly some sort of institutional or professional UM. And you know what their traders and traders trade where where the action is UM. You know, back in the old days of the option floors, you know, the people would come and go UM to you know, to the pits that had the active that had the active names. You know, in this case you don't have to physically move from one place to the next UM. But you know, people people follow the action. And I think that's whether that's professional or retail. I mean, if you're buying, if you're buy and hold investor, yeah, obviously you're not, you're not chasing these things. But if you're, if you've got any sort of trading mentality, there's there's that's where the volatility is, that's where the money is, and that's where the that's where the that's where the action tends to follow, and that's where the volume tends to follow. Steven. Another one of your notes recently, you wrote about something called Tina fomo and I think this this all sort of ties together. I'm hoping you can sort of break down what what exactly that means, because it's a mingling of two very popular acronyms. Right. I think I dated Tina Fomo when I was living in Philly for a while. I didn't have a lot of other options, though I was gonna say it sounds like a person last name. Yeah. That and there was the construct I actually got to admit I debuted that one when I guess author column Barons about five years ago, but I've I've loved it ever since. And but yeah, I mean it's unpacking. You know, the two most common acronyms to describe the market, you know, Tina being there is no alternative and fomo being the fear of missing out, Um, there is no alternative. Part now, I'm always a believer of that there's some alternative somewhere, but on the whole, I get it. I think there's if you're not unlet if it's very tough to make a case to be in cash that that earns nothing, or to be in fixed income that you know that pays nearly nothing, and neither is has incredibly, if you're gonna go out to credit, if you're gonna credit curve, you're not getting paid a ton. And if you're on the treasury cycle, you're probably you know, it's still almost a negative real interest it's still a negative real interest rate. So I get that. So you're gonna see you're gonna see money moving to risk assets, and you know, in its most extreme form, that's where you get back to the flight to crack. But let's let's keep it more or less into equity. So if you're you know, relatively binary cash bonds versus stocks, you're gonna be you're gonna be leaning towards stocks, and and that there is no alternative part. There is, there's a root, there's a routing there if you're missing out those purely emotional and ultimately, you know, although it has fear in it, it's really I think an expression of greed. You know, it's it's it's envy. Um, it's I don't you know everybody else is making money why shouldn't I be making money now? To a professional investor, that's kind of the way their career runs. Because if you don't sort of matt meet or you know, meet your benchmark or or or be in the top, you know, being that meeting part of the curve with your peers, if you're not gonna if you're not gonna outpace them, um, you know, there is career risk. So it's so it's like this weird fear and fear meets greed um and and that's the scarier part because the tina I can kind of quantify, you know, we can we can sit here and say like what's you know, what's the right level of risk premium? What you know, what level of yield should we be looking for in the sp F versus the ten year and have a very you know, high level discussion about that sort of stuff and probably have you know, cause a lot of people hit the PA you know, the pause button because it's dry. Um. The fomo stuff though, is very it's it's it's this weird it gets into human nature and that's where you get into the crazy stuff. And that's why I think it's a very dangerous combination. Um you know, she's a dangerous She's a dangerous woman. That ten fomo. Well, you know what, we like to get into the crazy stuff, Steve. But but one more, at least one more before we before we get there. But I think that, you know, and this may be oversimplifying everyone's strategy this year, but at the risk of oversimplifying it, it seems like, you know, the discussions we've had all year been, well, do you play the reopening stocks you travel, hotel leisure or do you stick with the sort of perennial growth names uh in the fang universe uh and tech that sort of thing. UM. I'm curious, a is that oversimplifying how we should approach the market? Um? Or is there still sort of some juice to squeeze from that lemon? And at which side would you squeeze? Now? Do you squeeze the reopening or would you you know, you you and the stick with growth in tech for as long as you can. Um. My, my gut is typically my gut is more towards the value side than the growth side. I think I think that there are names out there that are um, you know, that are high quality. I think right now it's you know, the retailers, you know, had this big bounce of the last few sessions because well, low and behold. If you you know, if you give people four checks and then open the stores, they're gonna go spend the money. Um. And so you know, I'm actually kicking myself, like, you know, why didn't I just put all my money into art acts or something like that when I when I was walking down broad lower Broadway and seeing lines outside all these solo sports, um, you know, but that that was that was my big miss. Left the money on the table boiler. But and my dad was a retail analyst, and so I used to have to go to malls with him and like count shopping bags and stuff like this. And so I'm really kicking myself on that one anyway. Um, you know, in terms of I look at it now and say, okay, if I think that, if I think that the FED is going to be less aggressive at monetary stimulus, and if whatever fiscal stimulus is going to come is going to be more in the form of long term infrastructure type of place, I'm starting to think about, you know, that dirty word of dividends. Um. And I think I want I think I want to own some some stocks that have a little bit of ballast to them um as opposed to stocks that are more precariously valued. You know, you had this thing going back and forth where where there was this idea, you know what people would would sell the d X stocks, you know, sell indie X if it fields, if Fields go up, and buy it on the inverse, which you know was was all predicated on value, you know, on on discounting, on the value of future cash flows. Just kind of listen. I'm like, really, valuation matters to you people, when when you know that's not that's not really you know, you're you're you're trying to trade Amazon on evaluation. Are you know an evaluation argument? Um? You know on Facebook? You know that there's plenty of reasons too, there's plenty of reasons to invest in these companies. But it's not because of there. It's not because you know, it's not because of you know, a fifteen basis point move in a tenure um affecting the affecting the long term cash flows. Um. You know. And so that's why I would tend to I've tended to to start to look for more, um more of your defensive place you know, if if you can earn a couple of if you can earn a couple of percent or two or three UM and yields, assuming of course that the company UM is you know, where it's cash flows can support that kind of dividend. UM. I can't give specific recommendations otherwise my compliance people will have my head. But that's the sort of but that's the sort of theme that I think will UM will you know, will benefit investors if we start to see some sort of UM, some sort of nerves among investors because the FETE is taking their foot off the gas, you know, and if I'm sure if you do that vetan diagram too, there's a lot of overlap between the beneficiaries of infrastructure spending and stocks with some good yields at this point. Indeed, there there would be you know, or consumer staples that you know, that kind of that kind of thing. Again, I can't I'm getting a lot of trouble if I throw out all the names. But you know, are there's an intelligent listenership and I know they'll they'll read between the lines there. We don't want to get you in trouble, Well do I might want to get you in trouble. I don't know. She's a troublemaker for you, maybe less so for me. Yeah, strategists gets fired for podcast interview. I mean it would be great for our metrics, not not so much for you, but so well, we're sympathetic to that. If anyone's gonna get fired from this podcast, it's gonna be me. Believe me. I think we can all agree on that. But the dow is Steve gave us the great Timing is everything, and Steve gave us a great set up there is literally, But I think I think it's not too early to to segue into those crazy things we saw this week. Soup stand clear of the craziest things we saw in markets this week. I'm gonna how about I start. I never start usually I saved the best for last um, But I'll just go ahead and I'll start this time. You save, you save yourself as as last, because you like to give yourself the award of crazy thing every week. That's true. That's true. You know, it's it's I'm the judge and jury here and I just have to I have to do the right thing. I mean, you know, it's it's a I've lost a few I've lost a few, but I like I like my chances this week. So in the world of alternative assets, one of my favorite things is trading cards. You know, baseball cards, the old Onus Wagner card, Babe Ruth, that sort of thing. Michael Jordan's Rookie card is a popular one. I bet you did not know, Stephen vill Donna, that there are guerrillas, actual zoo gorillas who have their own trading cards. At least the most famous one Harambe, who was the the guerrilla who died in two thousand and sixteen and became an Internet sensation. Some outfit made a trading card of Harambe. Uh. And it's going up for auction on this outfit Golden Auctions, which is now my new favorite source for for crazy things because this auction house is just filled with them. Um. And this story is courtesy I just to give credit where it's due. Sam Row of Axios tweeted about it. Uh. And it's actually based on an Instagram post from Golden Auctions and has actually going up for auction yet, so we don't really know what the bidding is gonna look like. But I found this same card for sale on eBay now granted people who set to buy it now. Uh, the ask on eBay might be a little more optimistic, uh than is warranted. But I will ask you to to tell me, what do you think if you were an eBay seller and you were putting the Harambe trading card from two thousand and sixteen up for sale on eBay and at a buy it now price, very optimistic price, I'll throw this factory it out to you too on the back of the card. And I did not know this. In one poll for the presidential election, Harambee actually got five support for president, and this is after he died. So I think that tells you more about the two thousand and sixteen election than than anything else. But well, Donna, what's your buy it now price? If you're selling the Harambe trading card on you? Is there only one? That's a good question. I do not know how many of there are. I will say there's other listings for the same card, but UM, I don't know about the condition. I think this perhaps this is the most prestine version of the card, or perhaps the most delusional seller on eBay at the moment. I'll leave it at that, But what's your what's your buy it now price for Harrambe trading card. I'm going to go with fifteen thousand, yes, okay, how about you, Steve, I'm gonna go with nine thousand, spot nine nine. That's a pretty good good guesses, Steve, I would tell you there actually was. There's another Harambe card up for that price, but the highest one is up for twenty tho. I will call it a push between you two. The highest by now, prist, I definitely win. She's she's five thousand dollars closer, all right. I was just being played. But there and there's one up for like even less than that. But I don't know. We'll have to check back and see what it actually sells for. I'm skeptical it'll actually go for twenty grand. But in this world, maybe someone will buy it, take a photo of it, and make an n f T out of it, and sell it for ten million. I think is that's the player and exactly what I was about to say. And that's actually my craziest thing. It's it's part of you know, some some of the things I've been reporting in regards to some of the prices that we've seen for some of these n f t s and then I saw so if I can give one example, I spoke with somebody who owns a pudgy penguin, which is like super super popular. They're really cute. They have these cute little outfits. It's just a cartoon of a penguin. Basically, it's an n f T um. This guy I spoke with bought it for and like four days later it was worth over seven thousand dollars. So that's why I don't think is too crazy for this baseball card. Umbe. Yes, yeah, it is a it's a very attractive portrait of Harrumbe on the card. I gotta say it looks like he posed for it. There's he's got this very uh it looks like something Steve and it is biography photo for his job. Would would have a nice thoughtful pose. And but there is there is one other crazy thing which is along the same lines. I'm grouping them all together for me here in my bid to win this week's Best Best Craziest Thing award. So there was a CNBC headline that said somebody just paid one point three million dollars for a picture of a rock. So if you have that going on one point three million dollars. Let me have the punchy penguins. Do they only exist in the n f T universe? Was that they were not something that's been turned into n f T s. They're not a cartoon or something. I mistered know. They exist as n f T s. There's eight thousand, eight hundred eight of them. They were all sold out, and I really I do have to say they're supremely cute. Okay, well that that's fair. Then if they're supremely cute, my question regarding the Harambe card is will it be one of the A M c apes who ends up buying? That's my guess. Yeah, it must have been that. I think that's who the bidders are. And that thing for sure. They referenced Harambe a lot. They're big, they're needles to say they're big Harambe fans on four gonna lead you know you. I was gonna go either with the pudgy penguin or the pet rock. And I even consulted, you know, so great minds think alike. I did consult my son, who's literally he does marketing for cryptocurrency companies. He's got a he's a comedian. He's actually a stand up comedian, but he hasn't made it big enough yet to not get rid of his day job. But his day job went from s a T tutoring to doing freelance marketing for crypto companies. And so I asked him, because he's very plugged into this world, and he basically said, you know, the pudgy penguin thing has gotta be gotta be your go to because you know, he's been seeing sort of the on Twitter, like I can't believe I spent five thousand dollars on a on a penguin avatar, and you know, he he, you know, he kind of went and went into this with me when I asked him over the you know, the last couple of days, and that one that to me. So I'm gonna I have to I have to vote with the donna because you know, she and I were do you and I we're treading the same ground on that one. Does your son own one of the puddect penguins? He does not. He um. He gets paid in crypto um, but he um. He tries to convert it because he has to pay. He has to do things like pay rent and you know, and and and little things like that. Um, he actually did do a video where he went around New York trying to spend a hundred dollars in crypto harder than you think off to check that out. That sounds good. Well, that's all I keep thinking about with all this, Steve is you know the old joke that in the gold Rush it was the people selling the picks and shovels that we're the only ones to get rich. So I imagine in the crypto thing, the marketing people are are could be the equivalent of that in this So I think that's a good uh. I think he's in the right place. I think in video is more the pick and shovel but true, true, true, good point. All right, well I'll take the all on that, and you can both see if you both came up with the podgy penguin. I I can't, I can't beat that, although Hormbey card, we have to see, we'll have to see which ends up being more valuable, harrumby training card or the pudgy penguin. N f T. Who would have ever thought words like that would be coming out of my mouth on a financial news podcast. But here we are Wildanna hire Steve. Thanks so much for your time. Hopefully we can do it again my pleasure. I look forward to the opportunity and I had a great time with you guys. Thank you so much for having me What Goes Up. We'll be back next week and so that you can find us on the Bloomberg Terminal, website and app where wherever you get your podcasts. We love it if you took the time to review and rate the show on Apple podcast so more listeners can find us. And you can find us on Twitter, follow me at Reaganonymous. Bildana Hirich is at Bildonna hi Rich. You can also follow Bloomberg Podcasts at podcasts and thank you to Charlie Pader, Bloomberg Radio and the voice of the New York City Subway System. What Goes Up is produced by Toph Forhez. The head of Bloomberg Podcasts is Francesco Levie. Thanks for listening. See you next time.

In 1 playlist(s)

  1. What Goes Up

    247 clip(s)

What Goes Up

Hosts Mike Regan and Vildana Hajric are joined each week by expert guests to discuss the main themes 
Social links
Follow podcast
Recent clips
Browse 247 clip(s)