1 00:00:00,080 --> 00:00:01,920 Welcome back, everyone. Today on the Joseph Carlson 2 00:00:01,920 --> 00:00:05,480 Show, we finally made it through the first six months of 2024. 3 00:00:05,600 --> 00:00:07,640 Pat yourself on the back for making it through. 4 00:00:08,080 --> 00:00:10,400 We're off to the second-half of the year, and I know we're all 5 00:00:10,400 --> 00:00:13,680 excited, but I think it's good during times like this to take a 6 00:00:13,680 --> 00:00:16,840 step back and look at how things went, to look at our portfolios, 7 00:00:16,840 --> 00:00:19,600 the performance of them and the performance of our different 8 00:00:19,600 --> 00:00:22,960 companies, to try to do some analysis and see what went right 9 00:00:23,000 --> 00:00:24,960 and what went wrong. And that's what we're going to 10 00:00:24,960 --> 00:00:28,280 be doing in this episode. I'll be going over My Portfolio 11 00:00:28,480 --> 00:00:31,560 showing you what went right, what went wrong, the performance 12 00:00:31,560 --> 00:00:35,600 of each company and the total performance against the S&P 500 13 00:00:35,720 --> 00:00:37,920 and the NASDAQ. So we have a lot to get to in 14 00:00:37,920 --> 00:00:39,240 this episode. I think it's going to be a lot 15 00:00:39,240 --> 00:00:41,680 of fun. We also have some new stories. 16 00:00:42,200 --> 00:00:45,520 We have another case where fund managers are underperforming. 17 00:00:45,840 --> 00:00:49,000 They're doing poorly, but this time they have their new excuse. 18 00:00:49,360 --> 00:00:51,720 The new excuse for underperformance is that they 19 00:00:51,720 --> 00:00:54,480 don't own NVIDIA. Well, you can't blame me. 20 00:00:54,480 --> 00:00:56,800 I just, I just happened to not pick NVIDIA. 21 00:00:57,120 --> 00:01:00,400 In fact, this excuse is so common now that the Wall Street 22 00:01:00,400 --> 00:01:03,280 Journal is reporting on it saying, no NVIDIA in your 23 00:01:03,280 --> 00:01:06,920 portfolio, you're just toast. We're going to be going over why 24 00:01:06,920 --> 00:01:10,320 this is an invalid excuse for underperformance and that if 25 00:01:10,320 --> 00:01:13,920 your fund manager making this excuse, you should stop your 26 00:01:13,920 --> 00:01:16,800 fund, you should stop investing other people's money, stop 27 00:01:16,800 --> 00:01:19,400 making excuses and just invest in the index. 28 00:01:19,640 --> 00:01:22,080 We also have a story here of the EU at it. 29 00:01:22,080 --> 00:01:24,360 Again, doing what they love to do. 30 00:01:24,560 --> 00:01:27,360 The EU is focused primarily on one thing, and that is 31 00:01:27,360 --> 00:01:30,840 regulating not their own companies, but US big tech 32 00:01:30,840 --> 00:01:33,000 companies. In this case, they're targeting 33 00:01:33,000 --> 00:01:36,520 Meta, suggesting that Meta's binary choice they give users of 34 00:01:36,560 --> 00:01:40,640 either having a paid plan that does not have ads or an ad plan 35 00:01:40,640 --> 00:01:43,760 that requires some user data is unfair. 36 00:01:44,160 --> 00:01:48,560 And the EU is demanding that Meta offer 1/3 option for users, 37 00:01:48,840 --> 00:01:52,280 one where you can have a free plan that requires no user data. 38 00:01:52,800 --> 00:01:55,640 We'll be going over how ridiculous this demand is from 39 00:01:55,640 --> 00:01:58,480 the EU and what Meta's likely to do in response. 40 00:01:58,640 --> 00:02:01,400 And then finally, we have the story of a company everyone's 41 00:02:01,400 --> 00:02:04,880 used going bankrupt. That company is Redbox. 42 00:02:05,200 --> 00:02:07,360 Remember the company you could go to and they had a vending 43 00:02:07,360 --> 00:02:09,919 machine for DVDs? You just pick out the movie you 44 00:02:09,919 --> 00:02:12,240 wanted and it literally dispense the movie. 45 00:02:12,680 --> 00:02:15,480 Redbox is going bankrupt. They're not paying their 46 00:02:15,480 --> 00:02:17,680 employees. They owe a lot of people a lot 47 00:02:17,680 --> 00:02:19,560 of money. We'll be looking at what went 48 00:02:19,560 --> 00:02:21,840 wrong for Redbox. So we're going to be going over 49 00:02:21,840 --> 00:02:24,800 all of that plus much more. Plus one thing that I want to 50 00:02:24,800 --> 00:02:26,280 mention, I think this is important. 51 00:02:26,280 --> 00:02:29,160 It's the beginning of the month, which means if you join the 52 00:02:29,160 --> 00:02:32,960 Joseph Carlson Show Patreon today, you will get the entire 53 00:02:32,960 --> 00:02:35,240 month for free. That gives you time to give a 54 00:02:35,240 --> 00:02:38,240 free trial for the service. The Patreon also 55 00:02:38,240 --> 00:02:41,760 includesqualtrum.com, which is the stock analysis tool I use. 56 00:02:42,240 --> 00:02:44,360 And we've added in new functionality. 57 00:02:44,480 --> 00:02:46,560 We've added in what's called KPIs. 58 00:02:46,560 --> 00:02:50,200 For example, if we're looking at Google here, we can see not only 59 00:02:50,200 --> 00:02:53,360 the normal financial data that Google offers, like revenue, 60 00:02:53,360 --> 00:02:55,640 free cash flow, net income, and earnings per share. 61 00:02:55,880 --> 00:02:58,240 All of that is visually illustrated, but we can dive 62 00:02:58,240 --> 00:03:00,920 into revenue segments. We can see how much comes from 63 00:03:00,920 --> 00:03:03,240 Google Search, YouTube ads, Google Network. 64 00:03:03,560 --> 00:03:06,920 These are KPIs. We can also see Google's cloud 65 00:03:06,920 --> 00:03:09,800 operating margins. This is mapped out in visual 66 00:03:09,800 --> 00:03:12,760 format so you can see the cloud of Google becoming more 67 00:03:12,760 --> 00:03:15,880 profitable overtime. Most stock analysis tools do not 68 00:03:15,880 --> 00:03:18,920 offer this information and we have KPI's for hundreds of top 69 00:03:18,920 --> 00:03:20,960 stocks in the market, ones like Airbnb. 70 00:03:20,960 --> 00:03:24,080 You can see their bookings and nightly experiences booked. 71 00:03:24,280 --> 00:03:27,240 You can go over to companies like Texas Roadhouse for example 72 00:03:27,640 --> 00:03:29,960 and see their amount of new restaurant openings. 73 00:03:30,160 --> 00:03:32,040 We can see their average weekly sales. 74 00:03:32,240 --> 00:03:35,120 We have the same thing for Chipotle and Wingstop and many 75 00:03:35,120 --> 00:03:37,600 other companies. We have KPIs for hundreds of top 76 00:03:37,600 --> 00:03:40,480 companies, and we have more added in every single week and 77 00:03:40,480 --> 00:03:42,240 more and more features for Qualtrum as well. 78 00:03:42,480 --> 00:03:44,800 If you want to try out Qualtrum and get access to exclusive 79 00:03:44,800 --> 00:03:47,640 episodes and a Discord community, you can do so today 80 00:03:47,640 --> 00:03:50,880 by joining the Patreon at patreon.com/josa Carlson. 81 00:03:51,160 --> 00:03:53,480 And again, there's no risk. You get the entire month for 82 00:03:53,480 --> 00:03:55,000 free. That's why I'm mentioning it. 83 00:03:55,000 --> 00:03:57,280 I think it's a great opportunity to at least try it out. 84 00:03:57,280 --> 00:04:00,600 Now let's go ahead and jump in to the portfolio and I first 85 00:04:00,600 --> 00:04:02,240 want to do an update on the performance. 86 00:04:02,240 --> 00:04:03,640 This is what it looks like right now. 87 00:04:03,640 --> 00:04:08,920 The total value is $239,000 and we have $77,000 in the green as 88 00:04:08,920 --> 00:04:10,720 of today. Now the first thing that we're 89 00:04:10,720 --> 00:04:13,720 going to do is go over the first six months of performance this 90 00:04:13,720 --> 00:04:16,519 year. So I'll filter things by year to 91 00:04:16,519 --> 00:04:18,440 date. If we look at the year to date 92 00:04:18,440 --> 00:04:22,440 performance, we are up 28% money weighted returns. 93 00:04:22,920 --> 00:04:25,800 Now, one thing I want to point out that I think is important is 94 00:04:25,800 --> 00:04:30,360 I have not added any new capital to this portfolio in 2024. 95 00:04:30,720 --> 00:04:34,120 None, not a penny. There has been no money added to 96 00:04:34,120 --> 00:04:39,320 the story fund in 2024. So these gains of 28%, they're 97 00:04:39,320 --> 00:04:41,400 just gains. They're not from any additional 98 00:04:41,400 --> 00:04:43,120 money. They're not from, you know, any 99 00:04:43,320 --> 00:04:46,240 additional funding. They're just from the portfolio 100 00:04:46,240 --> 00:04:48,200 alone. I know a lot of people think 101 00:04:48,200 --> 00:04:51,040 that when you add money it increases your returns, but 102 00:04:51,040 --> 00:04:52,800 that's not the case. That's not how this is 103 00:04:52,800 --> 00:04:55,320 calculated. This is all from returns of the 104 00:04:55,320 --> 00:04:57,320 portfolio. In fact, when I look at the 105 00:04:57,360 --> 00:05:00,880 starting value and the ending value and we look at the simple 106 00:05:00,880 --> 00:05:05,480 percentage increase, it is 29.08%. 107 00:05:05,640 --> 00:05:07,440 Now let's put this performance in context. 108 00:05:07,440 --> 00:05:09,800 We're up 28% this year in the story fund. 109 00:05:10,080 --> 00:05:14,480 The S&P 500 is up 15% this year. So we've doubled the performance 110 00:05:14,480 --> 00:05:17,600 of the S&P 500 year to date. When we look at this against the 111 00:05:17,600 --> 00:05:20,720 QQQ, we can also take a look at the performance here. 112 00:05:21,520 --> 00:05:26,360 Year to date, this is up 19%. Again, we're up 28% this year. 113 00:05:26,680 --> 00:05:30,360 So the first thing I want to point out is some people mention 114 00:05:30,360 --> 00:05:35,040 Joseph's portfolio is is good, but it's basically like the QQQ 115 00:05:35,120 --> 00:05:38,600 or the S&P 500 because I have a lot of familiar names that you 116 00:05:38,600 --> 00:05:42,360 see in the QQQ or the S&P 500. They suggest that I'm doing 117 00:05:42,360 --> 00:05:44,280 something called closet indexing. 118 00:05:44,400 --> 00:05:47,320 Closet indexing is a strategy that some fund managers use 119 00:05:47,320 --> 00:05:50,520 where they act like they're actively investing, like they're 120 00:05:50,520 --> 00:05:54,160 picking stocks, but in reality they're just mimicking the index 121 00:05:54,440 --> 00:05:56,440 and their performance follows the index. 122 00:05:56,760 --> 00:06:01,560 So their closet indexing this portfolio is not a closet index, 123 00:06:01,880 --> 00:06:05,400 and it's not something I suggest that would follow the S&P 500 or 124 00:06:05,400 --> 00:06:08,040 the QQQ. There's a lot of evidence to 125 00:06:08,040 --> 00:06:11,760 prove that this is not a closet index, one of them being that 126 00:06:11,760 --> 00:06:16,560 the makeup of this portfolio is nothing like the QQQ or the S&P 127 00:06:16,560 --> 00:06:20,320 500. This is a total of 5 holdings. 128 00:06:20,720 --> 00:06:23,720 There are 500 holdings in the S&P 500. 129 00:06:24,120 --> 00:06:29,840 This portfolio does not even own NVIDIA or Tesla or Berkshire or 130 00:06:29,840 --> 00:06:34,400 Pepsi or Costco or many other top holdings in the index. 131 00:06:34,840 --> 00:06:38,880 This portfolio has 50% of it in Amazon and Netflix. 132 00:06:39,360 --> 00:06:41,640 None of these metrics are anything like the index. 133 00:06:41,960 --> 00:06:44,680 The weighting, the makeup, the number of holdings and the 134 00:06:44,680 --> 00:06:47,960 performance is completely different than the index. 135 00:06:48,440 --> 00:06:50,720 So it makes sense that the performance of this over the 136 00:06:50,720 --> 00:06:53,320 last six months has been different than the indices. 137 00:06:53,440 --> 00:06:57,880 Again, we have the QQQ going up 19% and we have the S&P 500 138 00:06:57,880 --> 00:07:01,600 going up 15%. This portfolio is up 28%. 139 00:07:01,600 --> 00:07:04,680 The reason that the performance is so different than the indexes 140 00:07:04,680 --> 00:07:07,840 is because this portfolio is so different than the indexes. 141 00:07:07,960 --> 00:07:10,160 Now if we look at this performance overall on a greater 142 00:07:10,160 --> 00:07:12,040 timeline, we can see the breakdown here. 143 00:07:12,320 --> 00:07:15,520 Here's from the very beginning plotted out against the S&P 500 144 00:07:15,840 --> 00:07:17,880 as if I invested into either one. 145 00:07:18,240 --> 00:07:21,640 Right now, the portfolio is up 52% overall. 146 00:07:21,840 --> 00:07:26,520 Since the very beginning, the S&P 500 is up 37.9%. 147 00:07:26,720 --> 00:07:29,760 It's around 38%. So it's now outperforming the 148 00:07:29,760 --> 00:07:33,200 S&P 500 cents inception by a decent margin. 149 00:07:33,320 --> 00:07:34,920 And my goal is to continue doing this. 150 00:07:34,920 --> 00:07:37,800 I want greater and greater outperformance over the next 151 00:07:37,800 --> 00:07:40,320 year. So we're up $77,000 overall. 152 00:07:40,320 --> 00:07:43,640 If we can filter by the year to date, the past six months, we 153 00:07:43,640 --> 00:07:45,800 can take a look at the individual holdings and see how 154 00:07:45,800 --> 00:07:47,760 they're doing. Amazon is the single largest 155 00:07:47,760 --> 00:07:50,880 investment here, making up 35% of the portfolio. 156 00:07:51,240 --> 00:07:54,240 I intentionally overweighted Amazon because I felt like the 157 00:07:54,240 --> 00:07:58,600 risk reward was so dramatic. This company had so much upside 158 00:07:58,800 --> 00:08:01,600 and such little downside. I just thought it was one of the 159 00:08:01,600 --> 00:08:05,240 most asymmetric bets in the market with predictable returns 160 00:08:05,240 --> 00:08:09,640 in the future. This year Amazon is up 29% and I 161 00:08:09,640 --> 00:08:12,880 think there's more to go for this company, but right now it 162 00:08:12,880 --> 00:08:17,640 makes up 34% of the portfolio. So around 35% of My Portfolio is 163 00:08:17,640 --> 00:08:20,600 in Amazon. We have $18,000 of gains and a 164 00:08:20,600 --> 00:08:25,120 total position size of $82,900. When I look at the investment 165 00:08:25,120 --> 00:08:28,080 case for Amazon, I outline things very simply here. 166 00:08:28,440 --> 00:08:31,080 There's people that have very, you know, you can get really in 167 00:08:31,080 --> 00:08:34,559 depth and in the weeds with your investment case in a different 168 00:08:34,559 --> 00:08:36,240 company. But I also think it's good to 169 00:08:36,240 --> 00:08:39,360 just have a simple, a simple graphic like this showing why 170 00:08:39,360 --> 00:08:41,960 you're buying the company. With Amazon, they have the 171 00:08:41,960 --> 00:08:45,480 dominant market share of multiple great businesses. 172 00:08:45,720 --> 00:08:47,960 So if you're looking for companies that have great market 173 00:08:47,960 --> 00:08:51,280 concentration in important industries, Amazon is one of the 174 00:08:51,280 --> 00:08:55,080 top in this category. They are first place in cloud. 175 00:08:55,440 --> 00:08:57,440 I love cloud. I think it's still going to 176 00:08:57,440 --> 00:08:59,160 continue to be a huge money maker. 177 00:08:59,240 --> 00:09:02,760 Amazon has the commanding share of cloud with AWS and I think 178 00:09:02,840 --> 00:09:06,760 it's going to be very tough for even Microsoft to take that 179 00:09:06,760 --> 00:09:09,080 place. They are first place in online 180 00:09:09,080 --> 00:09:12,920 retail, so they have 40% of the market share of online retail, 181 00:09:13,240 --> 00:09:16,600 which again I'm very bullish on. They can run a lot of different 182 00:09:16,600 --> 00:09:19,240 applications on top of it. They can do a lot of different 183 00:09:19,240 --> 00:09:21,560 things with their first place position in retail. 184 00:09:21,920 --> 00:09:23,880 They are third place in advertising. 185 00:09:24,400 --> 00:09:28,760 You have Meta, you have Google, the two biggest advertisers, and 186 00:09:28,760 --> 00:09:30,600 then you have Amazon right in 3rd place. 187 00:09:31,200 --> 00:09:33,160 They almost don't get talked about that much. 188 00:09:33,160 --> 00:09:35,800 They're like not in the conversation for advertising as 189 00:09:35,800 --> 00:09:40,160 much, but Amazon has, I believe, the best advertising business in 190 00:09:40,160 --> 00:09:43,280 the world, not the largest. They're third place, but I think 191 00:09:43,280 --> 00:09:45,440 they have the best. They're second place in video 192 00:09:45,440 --> 00:09:47,680 streaming, which I believe is a great market. 193 00:09:47,680 --> 00:09:51,720 I'm invested heavily in Netflix and I believe ultimately all of 194 00:09:51,720 --> 00:09:54,400 this will lead to great operating leverage where their 195 00:09:54,400 --> 00:09:57,920 revenue out scales their expenses, they should scale to a 196 00:09:57,920 --> 00:10:02,520 large influx of free cash flow. My estimate is $70 billion of 197 00:10:02,520 --> 00:10:05,960 free cash flow this year. Now that could vary by like 10 198 00:10:05,960 --> 00:10:07,800 billion. Maybe it goes down to 60 199 00:10:07,800 --> 00:10:10,880 billion, maybe it's 75 billion. But I think they're going to 200 00:10:10,880 --> 00:10:13,720 have enormous amounts of free cash flow, which based on this 201 00:10:13,720 --> 00:10:17,240 analysis, makes the company not that expensive on a 202 00:10:17,240 --> 00:10:20,200 forward-looking basis. Amazon is still trading at a 3 203 00:10:20,200 --> 00:10:23,000 1/2% free cash flow yield. So even though the company has 204 00:10:23,000 --> 00:10:25,480 gone up a lot this year, I still see upside. 205 00:10:25,720 --> 00:10:31,640 I still see the 35% position in My Portfolio as 20% undervalued, 206 00:10:32,080 --> 00:10:34,720 so I'm not going to be shocked if Amazon races above $200.00 a 207 00:10:34,720 --> 00:10:38,760 share goes at 2:10 or 2:20. That won't be surprising at all. 208 00:10:38,960 --> 00:10:43,000 And no, I won't think it's overvalued if it does that now. 209 00:10:43,120 --> 00:10:46,720 Amazon has outperformed this year by a large extent, but not 210 00:10:46,720 --> 00:10:50,040 as much as Netflix. This is also a massive position 211 00:10:50,040 --> 00:10:53,480 in My Portfolio. It's now 29% of the portfolio. 212 00:10:53,840 --> 00:10:58,400 Netflix is now a $20,000 gain and $70,000 overall. 213 00:10:58,720 --> 00:11:02,040 So this one is just shy of Amazon because of how well it's 214 00:11:02,040 --> 00:11:04,600 performed. If we look at Netflix and we go 215 00:11:04,600 --> 00:11:08,080 over the investment thesis here, it's just five different bullet 216 00:11:08,080 --> 00:11:10,160 points. It's already a large, 217 00:11:10,160 --> 00:11:13,040 established, profitable, and growing streaming business that 218 00:11:13,040 --> 00:11:14,720 is extremely difficult to replicate. 219 00:11:14,960 --> 00:11:18,520 I've said this many times, a Moat is not only a lack of 220 00:11:18,520 --> 00:11:21,840 competitors, but a Moat is a difficulty in replicating what 221 00:11:21,840 --> 00:11:25,040 you've already created. To try to replicate what Netflix 222 00:11:25,040 --> 00:11:27,280 has created is near impossible at this point. 223 00:11:27,600 --> 00:11:31,040 The only companies that can even come close are ones maybe like 224 00:11:31,040 --> 00:11:34,520 Apple and Amazon, which already have so much cash flow they 225 00:11:34,520 --> 00:11:37,520 could technically burn the amount of money, but even they 226 00:11:37,520 --> 00:11:40,240 don't really want to do that. Netflix is in a very unique 227 00:11:40,240 --> 00:11:42,800 position. They're a massive streaming 228 00:11:42,800 --> 00:11:46,480 company with an already massive amount of free cash flow and a 229 00:11:46,480 --> 00:11:49,360 large and continuously growing total addressable market. 230 00:11:49,560 --> 00:11:51,920 I can't think of many companies in the world that are better 231 00:11:51,920 --> 00:11:55,280 positioned and more advantage than Netflix at this point. 232 00:11:55,280 --> 00:11:57,120 I think it's nearly indisruptible. 233 00:11:57,440 --> 00:11:59,400 I think the company will continue growing with some 234 00:11:59,400 --> 00:12:02,560 volatility. Now there's YouTube. 235 00:12:02,880 --> 00:12:06,040 YouTube is competing with Netflix in a way, I guess for 236 00:12:06,040 --> 00:12:09,160 attention, but people love scripted long form 237 00:12:09,160 --> 00:12:12,200 entertainment. This is unlikely to change even 238 00:12:12,200 --> 00:12:15,880 with social media and YouTube. And YouTube has tried to compete 239 00:12:15,880 --> 00:12:19,520 directly head on with Netflix. Remember Cobra Kai, the 240 00:12:19,520 --> 00:12:21,800 different series that kind of started on YouTube? 241 00:12:22,320 --> 00:12:24,880 They were successful on Netflix, not on YouTube. 242 00:12:25,000 --> 00:12:27,480 But YouTube doesn't compete well in scripted entertainment. 243 00:12:27,760 --> 00:12:30,600 And I believe that Netflix is going to own that category and 244 00:12:30,600 --> 00:12:33,840 profit dramatically from it. Wall Street has been way off 245 00:12:33,840 --> 00:12:35,760 with their estimates. They've continually 246 00:12:35,760 --> 00:12:37,920 underestimated the amount of operating leverage in the 247 00:12:37,920 --> 00:12:39,680 business. And that's a place where 248 00:12:39,680 --> 00:12:43,080 analysts often get things wrong, underestimating operating 249 00:12:43,080 --> 00:12:44,920 leverage. And I think they're continuing 250 00:12:44,920 --> 00:12:47,400 to do that with Netflix. And then with Netflix, there's 251 00:12:47,400 --> 00:12:50,400 also a lot of opportunities for AI to enhance engagement and the 252 00:12:50,400 --> 00:12:52,400 interface, they control the interface. 253 00:12:52,400 --> 00:12:54,760 They've been at the top of their game with this, and I think 254 00:12:54,760 --> 00:12:56,360 they're going to improve it over time. 255 00:12:56,480 --> 00:12:59,920 These two companies, Netflix and Amazon, make up 65% of the 256 00:12:59,920 --> 00:13:02,280 portfolio. So the majority of this is being 257 00:13:02,280 --> 00:13:05,000 driven by just two companies. And I believe that both of them 258 00:13:05,000 --> 00:13:07,880 have very bright futures. Now, I also own Google and 259 00:13:07,880 --> 00:13:09,480 Microsoft. Both of these companies are 260 00:13:09,480 --> 00:13:11,240 cloud winners, I think very predictably. 261 00:13:11,240 --> 00:13:13,800 And then we have S&P Global, which is a data play. 262 00:13:14,240 --> 00:13:16,880 So all of these companies play a role, but the biggest ones by 263 00:13:16,880 --> 00:13:20,240 far are Amazon and Netflix. If these companies do well and 264 00:13:20,240 --> 00:13:24,000 prosper, then this portfolio will dramatically outperform the 265 00:13:24,000 --> 00:13:26,560 S&P 500. If these companies do poorly, 266 00:13:26,920 --> 00:13:30,120 they underperform, they run into problems, this portfolio is 267 00:13:30,120 --> 00:13:33,200 going to suffer. So I am aligning the future of 268 00:13:33,200 --> 00:13:36,520 my performance with Amazon and Netflix, and I personally feel 269 00:13:36,520 --> 00:13:39,240 very comfortable doing this with this high level of 270 00:13:39,240 --> 00:13:41,440 concentration. Because of the research I've 271 00:13:41,440 --> 00:13:44,240 done into these companies, I have a high degree of confidence 272 00:13:44,240 --> 00:13:46,800 that they're going to do well with their risk and reward. 273 00:13:46,840 --> 00:13:49,240 So there's your update on the first six months of the year. 274 00:13:49,440 --> 00:13:51,320 We'll check in throughout the year and see how things are 275 00:13:51,320 --> 00:13:54,680 going, but so far, so good. Now, Speaking of portfolio 276 00:13:54,680 --> 00:13:56,840 performance, we get to the first new story of the day. 277 00:13:56,840 --> 00:13:58,320 This one comes from The Wall Street Journal. 278 00:13:58,800 --> 00:14:01,960 And this story works as an excuse for fund managers to 279 00:14:01,960 --> 00:14:05,920 underperform the market. It reads, no NVIDIA in your 280 00:14:05,920 --> 00:14:09,240 portfolio, you're just toast. There are artificial 281 00:14:09,240 --> 00:14:12,120 intelligence plays like NVIDIA, and then there's everything 282 00:14:12,120 --> 00:14:13,960 else. As the second-half of the year 283 00:14:13,960 --> 00:14:16,800 begins, investors are wondering whether something has to give. 284 00:14:16,920 --> 00:14:19,880 NVIDIA reported sales and profits in May that blew past 285 00:14:19,880 --> 00:14:23,040 Wall Street expectations for the 5th consecutive quarter. 286 00:14:23,320 --> 00:14:28,920 The stock rose 37% in the second quarter and is up 149% this 287 00:14:28,920 --> 00:14:31,000 year. Much of the rest of the index 288 00:14:31,000 --> 00:14:33,720 has languished. The average stock within the S&P 289 00:14:33,720 --> 00:14:39,440 500 is up 4.1% this year, while the broad index is up 14.5%. 290 00:14:39,600 --> 00:14:41,800 This is the largest underperformance since at least 291 00:14:41,800 --> 00:14:44,600 1990, according to the Dow Jones Market Data. 292 00:14:44,840 --> 00:14:47,360 The Divergent has some value investors throwing up their 293 00:14:47,360 --> 00:14:49,520 hands. So so far they're pointing out 294 00:14:49,880 --> 00:14:53,040 that the index with NVIDIA is up a lot. 295 00:14:53,040 --> 00:14:56,280 It's up like 15%, just like we looked at, but without NVIDIA. 296 00:14:56,280 --> 00:14:59,760 If you just had an equally weighted index, it's only up 4%. 297 00:15:00,160 --> 00:15:02,800 So NVIDIA is really carrying the index. 298 00:15:02,800 --> 00:15:04,280 It's carrying it on its shoulders. 299 00:15:04,520 --> 00:15:07,200 It's doing all the work and it, you know, Nvidia's up there 300 00:15:07,200 --> 00:15:09,800 alone looking back at every other company saying you 301 00:15:09,800 --> 00:15:12,080 slackers, I'm going to do the work for all of you. 302 00:15:12,080 --> 00:15:15,280 So a lot of fund managers are upset that Nvidia's doing so 303 00:15:15,280 --> 00:15:18,480 well and seemingly everything else is doing so poorly. 304 00:15:18,640 --> 00:15:22,560 Quote, we can't keep up because we don't own NVIDIA, said Max 305 00:15:22,560 --> 00:15:26,240 Westerman, Co founder and senior portfolio manager at Merriman 306 00:15:26,240 --> 00:15:29,280 Capital. Quote, if you don't own that one 307 00:15:29,280 --> 00:15:32,480 stock, it really hurts. Every day feels like a root 308 00:15:32,480 --> 00:15:35,320 canal without Novocaine. We have other market strategist 309 00:15:35,320 --> 00:15:37,760 saying the same thing. Quote, it makes sense to me that 310 00:15:37,760 --> 00:15:40,240 we are packed into a lot of these AI plays because that's 311 00:15:40,240 --> 00:15:42,000 where people feel like there's secular growth. 312 00:15:42,440 --> 00:15:45,360 This is from Julia Beal. Even if you do a great job and 313 00:15:45,360 --> 00:15:47,920 the rest of your portfolio, if you're not overweight in the 314 00:15:47,920 --> 00:15:51,840 same place, you're just toast. So the message they're sharing 315 00:15:51,840 --> 00:15:54,920 here in this article, and it gives more and more examples, is 316 00:15:54,920 --> 00:15:58,400 there's many fund managers now stating that the reason they're 317 00:15:58,400 --> 00:16:01,840 underperforming the market is because they don't own NVIDIA. 318 00:16:02,240 --> 00:16:05,480 If you don't own NVIDIA, you can't keep up, you're toast. 319 00:16:05,520 --> 00:16:08,320 You're out of the game. It's just that's the market. 320 00:16:08,320 --> 00:16:10,720 And if you, if you just happen not to pick it, you're just 321 00:16:10,720 --> 00:16:12,760 unlucky. It doesn't have anything to do 322 00:16:12,760 --> 00:16:15,560 with your stock picking efforts. You're just unlucky that you 323 00:16:15,560 --> 00:16:18,720 don't own NVIDIA. Now I get it. 324 00:16:18,720 --> 00:16:21,600 Anytime you're behind in something, you want to make up 325 00:16:21,600 --> 00:16:23,760 excuses, you want to point to something else. 326 00:16:24,040 --> 00:16:26,760 That is the natural human tendency of all of us. 327 00:16:26,760 --> 00:16:29,400 And I, I must have fallen victim to that as well, wanting to 328 00:16:29,400 --> 00:16:30,840 blame other things from time to time. 329 00:16:31,600 --> 00:16:33,680 But in this case, I just don't buy it. 330 00:16:34,200 --> 00:16:37,440 Blaming the lack of owning NVIDIA for underperforming the 331 00:16:37,440 --> 00:16:41,480 market this year is just an excuse, and it's not accurate. 332 00:16:41,600 --> 00:16:44,160 There are many companies this year that have outperformed both 333 00:16:44,160 --> 00:16:48,360 the S&P 500 and the QQQ. NVIDIA is not the only one. 334 00:16:48,560 --> 00:16:52,480 Like we literally just went over in My Portfolio just minutes 335 00:16:52,480 --> 00:16:54,920 ago. This portfolio has trounced the 336 00:16:54,920 --> 00:16:58,040 market, trounced. The S&P 500 this year has 337 00:16:58,040 --> 00:17:00,480 doubled the performance without NVIDIA. 338 00:17:00,760 --> 00:17:04,240 Do you see NVIDIA anywhere here? I don't, and I've never owned 339 00:17:04,240 --> 00:17:06,800 the stock in either of my portfolios, which are both doing 340 00:17:06,800 --> 00:17:09,119 better than the market. Four of the five companies I've 341 00:17:09,119 --> 00:17:12,680 picked in this portfolio have beat the market this year by a 342 00:17:12,680 --> 00:17:15,400 lot. Amazon, Netflix, Google, and 343 00:17:15,400 --> 00:17:17,960 Microsoft are all market beating picks. 344 00:17:18,400 --> 00:17:21,440 So this isn't a case where NVIDIA is the market. 345 00:17:21,599 --> 00:17:24,160 We can actually look at some data here to prove this theory 346 00:17:24,160 --> 00:17:26,079 wrong. We look at the S&P 500 347 00:17:26,079 --> 00:17:28,720 constituents and their performance this year to date, 348 00:17:28,720 --> 00:17:31,800 so the past six months, and we look at what's performing well. 349 00:17:32,240 --> 00:17:34,160 It is true that NVIDIA is right at the top. 350 00:17:34,480 --> 00:17:38,000 It has 150% performance, but it's not even the best 351 00:17:38,000 --> 00:17:39,800 performing in the index this year. 352 00:17:40,120 --> 00:17:48,080 SMCI has beat it with 185%. VST is up 126%, CG is up 75%, 353 00:17:48,480 --> 00:17:53,320 Eli Lilly's up 56%, GE, we have Micron Technologies, we have 354 00:17:53,320 --> 00:17:57,000 Crowdstrike, NRGA NET. We have 19 companies here that 355 00:17:57,000 --> 00:18:00,360 all have performance above 38% this year. 356 00:18:00,760 --> 00:18:03,480 That is over double the S&P 500 performance. 357 00:18:03,680 --> 00:18:06,520 And this goes on for page after page after page of different 358 00:18:06,520 --> 00:18:08,320 companies that have outperformed the index. 359 00:18:08,600 --> 00:18:11,720 We're now on Page Six. These are results number one 360 00:18:11,720 --> 00:18:14,800 hundred 110. We have over 100 companies that 361 00:18:14,800 --> 00:18:16,440 have outperformed the market this year. 362 00:18:16,440 --> 00:18:19,640 So when you listen to portfolio managers make excuses for their 363 00:18:19,640 --> 00:18:23,200 underperformance and you see the constant stream of articles 364 00:18:23,200 --> 00:18:26,240 talking about market concentration and how difficult 365 00:18:26,240 --> 00:18:29,400 it is for stock pickers, just keep in mind there's well over 366 00:18:29,400 --> 00:18:31,920 100 companies that have dramatically outperformed the 367 00:18:31,920 --> 00:18:34,560 market this year. And if you pick a few of them, 368 00:18:34,800 --> 00:18:36,640 you'll do much better than the index. 369 00:18:37,040 --> 00:18:40,160 There's always excuses made. Any time someone's behind, 370 00:18:40,400 --> 00:18:42,800 they're going to make excuses. Now, moving on, we get to the 371 00:18:42,800 --> 00:18:46,160 story of the EU at it again, doing what they do best, which 372 00:18:46,160 --> 00:18:48,360 is regulating US big tech companies. 373 00:18:48,600 --> 00:18:50,520 This time it's not targeting Apple. 374 00:18:50,640 --> 00:18:53,480 They've moved on to Meta, one of their favorite targets as well. 375 00:18:54,240 --> 00:18:58,320 This one is probably more absurd and ridiculous than the than the 376 00:18:58,320 --> 00:19:01,440 demands they're making for Apple with their demands for Meta. 377 00:19:01,440 --> 00:19:04,240 They're complaining about the way the company is monetizing 378 00:19:04,480 --> 00:19:07,600 its content, giving different options to customers. 379 00:19:07,880 --> 00:19:10,720 They say that EU has formally charged Meta with violations of 380 00:19:10,720 --> 00:19:13,720 its Digital Marketing Act, making its second such charge in 381 00:19:13,720 --> 00:19:15,480 many weeks. The European Commission writes 382 00:19:15,480 --> 00:19:18,640 in a preliminary ruling that the pay or consent advertising model 383 00:19:18,880 --> 00:19:21,360 that launched last year for Facebook and Instagram users 384 00:19:21,720 --> 00:19:26,520 runs afoul the Article 5 two of the DMA by not giving users 1/3 385 00:19:26,520 --> 00:19:30,400 option that uses less data for AD targeting, but it's still 386 00:19:30,400 --> 00:19:33,480 free to use. Regulators found that their 387 00:19:33,480 --> 00:19:37,600 investigation that Meta gives uses a binary choice that forces 388 00:19:37,600 --> 00:19:40,920 them to either choose to pay a monthly subscription fee or 389 00:19:40,920 --> 00:19:42,880 consent to the ad supported version. 390 00:19:42,960 --> 00:19:45,840 So in summary, Meta is giving EU customers two different options 391 00:19:45,840 --> 00:19:48,840 to use their platform. They can choose the free version 392 00:19:48,840 --> 00:19:51,280 where you can just sign up and use it for free and it's ad 393 00:19:51,280 --> 00:19:53,520 supported. And then you have the pay 394 00:19:53,520 --> 00:19:56,800 version where you pay for the subscription and you have no 395 00:19:56,800 --> 00:19:59,440 ads. Now with the free version, Meta 396 00:19:59,440 --> 00:20:01,800 collects some of your data so that they can present to you 397 00:20:02,080 --> 00:20:04,800 relevant advertisements so that their ads are effective. 398 00:20:04,880 --> 00:20:08,120 And the EU argues that this pay or consent model violates their 399 00:20:08,120 --> 00:20:11,160 laws, that this new law that they just passed says that there 400 00:20:11,160 --> 00:20:14,480 has to be a free version, an advertisement supported version 401 00:20:14,680 --> 00:20:17,400 that doesn't collect data. And this is how ridiculous these 402 00:20:17,400 --> 00:20:20,040 claims are getting. According to the EU, Meta is 403 00:20:20,040 --> 00:20:23,000 supposed to just offer to the EU customer base. 404 00:20:23,520 --> 00:20:26,920 A free version of their platform that is ad supported that 405 00:20:26,920 --> 00:20:29,800 doesn't track your data or have any data of yours. 406 00:20:30,480 --> 00:20:31,920 Now how are they supposed to do that? 407 00:20:32,280 --> 00:20:35,240 They're supposed to just blast you with ads, not knowing 408 00:20:35,360 --> 00:20:38,200 anything about you, your tastes, your preferences. 409 00:20:38,400 --> 00:20:41,680 They don't know anything about you at all, so how do they know 410 00:20:41,680 --> 00:20:43,680 which ads to actually provide to you? 411 00:20:44,280 --> 00:20:46,800 Well, they don't. According to the EU, Meta should 412 00:20:46,800 --> 00:20:49,200 just launch any ads to any person. 413 00:20:49,640 --> 00:20:52,840 Of course, that would render all of the ads on Meta's properties 414 00:20:52,840 --> 00:20:55,360 completely ineffective. They wouldn't make any money 415 00:20:55,360 --> 00:20:57,520 doing this. If they're launching completely 416 00:20:57,520 --> 00:21:00,120 untargeted ads, those advertisement rates would go 417 00:21:00,120 --> 00:21:02,280 down dramatically. People would stop selling 418 00:21:02,280 --> 00:21:04,760 products on Meta because it would be essentially worthless. 419 00:21:05,120 --> 00:21:08,560 So the EU is demanding that Meta change their business model to 420 00:21:08,560 --> 00:21:12,560 become completely unprofitable in their territory and offer 421 00:21:12,560 --> 00:21:14,600 that for free for their customers. 422 00:21:15,600 --> 00:21:19,000 Again, the reason that these companies track your data in an 423 00:21:19,000 --> 00:21:23,240 advertising based product is so that they can offer relevant 424 00:21:23,240 --> 00:21:25,560 ads. If they can't offer relevant 425 00:21:25,560 --> 00:21:27,280 ads, they're not going to sell you anything. 426 00:21:27,320 --> 00:21:29,440 We've all seen cases of completely untargeted 427 00:21:29,440 --> 00:21:31,400 advertisement. It's totally ineffective. 428 00:21:31,720 --> 00:21:33,960 I'm sure you've seen it before where you get advertised a 429 00:21:33,960 --> 00:21:36,240 product that you wouldn't buy in a million years. 430 00:21:36,640 --> 00:21:39,640 That renders the advertisement rates so low that you can't 431 00:21:39,640 --> 00:21:42,360 really make money doing that. In the case of Meta, the reason 432 00:21:42,360 --> 00:21:45,280 this company makes money is because of how well they can 433 00:21:45,280 --> 00:21:47,880 target advertisements. Now, that doesn't mean that they 434 00:21:47,880 --> 00:21:50,440 have to violate your privacy. It doesn't mean that they have 435 00:21:50,440 --> 00:21:53,200 to sell your data or become a data broker and share it with 436 00:21:53,200 --> 00:21:55,480 different companies. It just means that they collect 437 00:21:55,480 --> 00:21:59,800 some of the data that you give them by using their platform to 438 00:21:59,800 --> 00:22:02,720 use an advertising. Amazon does the exact same 439 00:22:02,720 --> 00:22:05,600 thing. When you shop on Amazon, Amazon 440 00:22:05,600 --> 00:22:08,160 knows your order history. They know your age, they know 441 00:22:08,160 --> 00:22:10,520 your spending habits. They don't share it with anyone. 442 00:22:10,520 --> 00:22:12,840 They're not brokering it or selling it or doing anything 443 00:22:13,040 --> 00:22:15,600 devious with it. They just know a bit about you 444 00:22:15,600 --> 00:22:18,600 and they use that the further advertised to you to make the 445 00:22:18,600 --> 00:22:21,920 product better for you. That makes Amazon more effective 446 00:22:22,200 --> 00:22:23,680 and it makes your experience better. 447 00:22:23,680 --> 00:22:26,640 So what the EU is doing here is a continuation of this constant 448 00:22:26,640 --> 00:22:30,000 theme of trying to break the business model of American big 449 00:22:30,000 --> 00:22:32,520 tech companies. And they're doing it again with 450 00:22:32,520 --> 00:22:35,360 Meta. Forcing Meta to offer a third 451 00:22:35,360 --> 00:22:39,440 plan that users don't pay for and they don't have any data 452 00:22:39,440 --> 00:22:42,720 that they have to share with Meta and it's offered for free 453 00:22:42,920 --> 00:22:46,120 is an absurd and ridiculous demand and it should be thrown 454 00:22:46,120 --> 00:22:47,520 out. In this type of case. 455 00:22:47,520 --> 00:22:50,440 I think it gets to the point where Meta eventually will have 456 00:22:50,440 --> 00:22:53,080 to either dumb down their products so much in the EU to 457 00:22:53,080 --> 00:22:55,480 render them completely useless. They've done so in different 458 00:22:55,480 --> 00:22:57,400 smaller markets. They've removed different 459 00:22:57,400 --> 00:22:59,720 features, they've disabled different parts of their 460 00:22:59,720 --> 00:23:02,280 platform to comply with these onerous laws. 461 00:23:02,280 --> 00:23:05,280 But I believe this constant over regulation from the EU 462 00:23:05,640 --> 00:23:07,200 eventually will cause something to break. 463 00:23:07,280 --> 00:23:10,120 There will be some extreme pushback at some point. 464 00:23:10,160 --> 00:23:12,920 Now finally, we get to the story of the tragic ending for the 465 00:23:12,920 --> 00:23:15,160 company Redbox. I'm sure you've used this 466 00:23:15,160 --> 00:23:16,840 company before. Most of you are at least 467 00:23:16,840 --> 00:23:19,640 familiar with it. I have, maybe I just watch more 468 00:23:19,640 --> 00:23:22,200 movies than the average person. But Redbox was this company you 469 00:23:22,200 --> 00:23:24,120 could go to. And it was on the side of 470 00:23:24,120 --> 00:23:26,880 Walgreens and different companies that have it right 471 00:23:26,880 --> 00:23:30,320 there out in the side. And it was a, it was basically 472 00:23:30,320 --> 00:23:33,520 like a vending machine for movies and in some cases video 473 00:23:33,520 --> 00:23:36,080 games as well. You could rent it and you'd pay 474 00:23:36,080 --> 00:23:39,360 like a a dollar a day. So very simple business model. 475 00:23:39,600 --> 00:23:41,200 You rent the movie, you return it. 476 00:23:41,480 --> 00:23:43,840 It's convenient. And they had relatively new 477 00:23:43,840 --> 00:23:46,600 movies as well in Redbox. But things have not been going 478 00:23:46,600 --> 00:23:50,000 well with Redbox. Redbox's owner, Chicken Soup for 479 00:23:50,000 --> 00:23:53,240 the Sole Entertainment, filed for bankruptcy protection 480 00:23:53,240 --> 00:23:55,360 overnight. This comes at the tail end of 481 00:23:55,360 --> 00:23:58,600 the month in which the DVD rental company defaulted on 482 00:23:58,600 --> 00:24:01,800 loans, saw an order for its cars to be repossessed and miss 483 00:24:01,800 --> 00:24:04,760 payroll for employees. Now, when your company is 484 00:24:04,760 --> 00:24:08,400 getting its cars repossessed, you're in bad shape. 485 00:24:08,400 --> 00:24:12,040 Like that is you have gone through layers of bad financial 486 00:24:12,040 --> 00:24:15,600 moves to get to the point where the government is now taking the 487 00:24:15,800 --> 00:24:18,400 the company's assets and just repossessing assets. 488 00:24:18,840 --> 00:24:22,200 And if you're at a company that's missing payroll, unless 489 00:24:22,200 --> 00:24:25,200 it's like a very small startup and you kind of expected that 490 00:24:25,200 --> 00:24:28,680 going in, it's time to move on. If your company's missing 491 00:24:28,680 --> 00:24:31,800 payroll, if they're not paying employees, you got to move on. 492 00:24:31,800 --> 00:24:33,640 Get to a new job, get to something where you're going to 493 00:24:33,640 --> 00:24:35,360 get paid. In many cases, you're not going 494 00:24:35,360 --> 00:24:38,240 to get this money back without a lot of litigation and heartache. 495 00:24:38,440 --> 00:24:41,120 The company also promised to reinstate health insurance for 496 00:24:41,120 --> 00:24:43,280 its employees, which have lapsed in May. 497 00:24:43,760 --> 00:24:46,600 So employees are losing their health insurance and they're not 498 00:24:46,600 --> 00:24:48,720 getting paid. However, it's not certain that 499 00:24:48,720 --> 00:24:50,760 the company will be able to secure such a loan. 500 00:24:51,040 --> 00:24:53,960 Chicken Soups bankruptcy filing shows that the company owes 501 00:24:53,960 --> 00:24:57,320 money to a number of retailers, including Walmart and Walgreens, 502 00:24:57,320 --> 00:24:59,960 as well as major Hollywood studios like Universal, Sony, 503 00:24:59,960 --> 00:25:04,240 Lionsgate and Warner Bros. So there may be some distressed 504 00:25:04,360 --> 00:25:08,840 debt investor that may go in and give them a loan under extremely 505 00:25:08,840 --> 00:25:11,800 harsh covenants. But I don't think it's likely to 506 00:25:11,800 --> 00:25:15,240 get a loan in a company where you owe a bunch of different 507 00:25:15,240 --> 00:25:17,440 companies a lot of money, where you haven't paid employees, 508 00:25:17,440 --> 00:25:20,960 where your business model is obviously antiquated, I think is 509 00:25:20,960 --> 00:25:23,440 a very difficult task. I can't imagine who would give 510 00:25:23,440 --> 00:25:26,840 them a loan at this point. Other creditors include smaller 511 00:25:26,840 --> 00:25:30,280 studios, streaming platforms, smart TV manufacturers with a 512 00:25:30,280 --> 00:25:34,400 list of names including the BBC, Vizio, Plex, Redbox and Chicken 513 00:25:34,400 --> 00:25:37,680 Soup owned Crackle have been operating their own free ad 514 00:25:37,680 --> 00:25:40,440 sported streaming service on a variety of platforms. 515 00:25:41,160 --> 00:25:44,520 So they're trying to follow in the steps of Netflix and Roku, 516 00:25:44,760 --> 00:25:46,480 but they're too small to get to scale. 517 00:25:46,560 --> 00:25:49,040 They're losing money. The company also owes money to 518 00:25:49,040 --> 00:25:52,600 its landlords, the vendor it rents its car fleet from, and 519 00:25:52,600 --> 00:25:54,720 others. So Redbox owes a dozen different 520 00:25:54,720 --> 00:25:57,600 companies money and they're looking for a loan so that they 521 00:25:57,600 --> 00:26:00,600 can owe one more company money. Chicken Soup took on 522 00:26:00,600 --> 00:26:05,360 $325,000,000 in debt when it acquired Redbox in 2022 and has 523 00:26:05,360 --> 00:26:08,480 since been sued over a dozen times over unpaid bills. 524 00:26:08,880 --> 00:26:11,600 The company recently settled one of these lawsuits with NBC 525 00:26:11,600 --> 00:26:15,280 Universal, but promptly missed the first agreed upon payment. 526 00:26:15,560 --> 00:26:18,280 So they settled under certain terms and then immediately 527 00:26:18,280 --> 00:26:21,560 violated those terms, leading to a court order to pay the entire 528 00:26:21,760 --> 00:26:25,600 $16.7 million balance. Altogether, Chicken Soup has 529 00:26:25,600 --> 00:26:29,520 $970 million in debt, according to the bankruptcy filing. 530 00:26:29,520 --> 00:26:32,400 So I think it's safe to say at this point that we can all say 531 00:26:32,400 --> 00:26:35,440 goodbye to Redbox and the memories we had picking up the 532 00:26:35,440 --> 00:26:38,560 DVD with the little screen, when someone else walks up behind 533 00:26:38,560 --> 00:26:40,280 you, you feel a little pressured, like you got to pick 534 00:26:40,280 --> 00:26:42,800 really soon. We've all had those experiences 535 00:26:42,800 --> 00:26:44,800 and it's going to be a sad point to move on from it. 536 00:26:45,480 --> 00:26:48,840 This is an extension of the same business model that GameStop 537 00:26:48,840 --> 00:26:52,280 had, renting, movies, trading and video games. 538 00:26:52,640 --> 00:26:55,120 All of that is going away. It's all being replaced by 539 00:26:55,120 --> 00:26:58,440 digital downloads and streaming. So that is the tragic end for 540 00:26:58,440 --> 00:27:00,200 Redbox. Now, if you want to see more 541 00:27:00,200 --> 00:27:03,600 content, exclusive episodes, and get access to qualtrum.com and 542 00:27:03,600 --> 00:27:07,320 all of the KPIs, you can do so under the Patreon membership. 543 00:27:07,560 --> 00:27:10,040 You can try it out free today and you get a full month free 544 00:27:10,040 --> 00:27:12,320 trial, so try it out. If you don't, I think you're 545 00:27:12,320 --> 00:27:14,000 missing out. Other than that, I'll see you in 546 00:27:14,000 --> 00:27:14,560 the next one.