1 00:00:00,040 --> 00:00:01,960 Welcome back, everyone. Today on the Joseph Carlson 2 00:00:01,960 --> 00:00:05,240 Show, there are thousands of companies in the stock market 3 00:00:05,240 --> 00:00:08,560 and in this episode we'll be going over four of them, four 4 00:00:08,560 --> 00:00:11,360 companies that are buys today. The companies we're going to be 5 00:00:11,360 --> 00:00:13,080 going over are compounding machines. 6 00:00:13,080 --> 00:00:15,520 They're very strong companies and they're offering you an 7 00:00:15,520 --> 00:00:18,040 entry point today. We also have other news we'll be 8 00:00:18,040 --> 00:00:22,160 going over, including Netflix now adjusting their deal to buy 9 00:00:22,160 --> 00:00:24,800 Warner Brothers Discovery. Before they were doing it in 10 00:00:24,800 --> 00:00:27,960 part cash and part stock. Now they're likely adjusting it 11 00:00:27,960 --> 00:00:29,960 to all cash. We'll be looking at the real 12 00:00:30,040 --> 00:00:32,400 reason they're doing this. We also have the news that Trump 13 00:00:32,400 --> 00:00:35,480 is demanding credit card companies have a capped interest 14 00:00:35,480 --> 00:00:38,480 rate of 10%. This has caused a stir in the 15 00:00:38,480 --> 00:00:40,640 market. It's caused many companies from 16 00:00:40,640 --> 00:00:42,840 banks to credit card companies to sell down. 17 00:00:42,840 --> 00:00:45,800 There are so many misconceptions, bad information, 18 00:00:45,800 --> 00:00:49,080 and outright lies associated with this news, and we'll be 19 00:00:49,080 --> 00:00:50,760 clearing it all up in this episode. 20 00:00:50,800 --> 00:00:52,720 We have Google continuing from strength to strength. 21 00:00:52,840 --> 00:00:56,240 We'll be looking at how Google's Gemini has a significant 22 00:00:56,240 --> 00:00:59,040 advantage over competitors. And then finally, we have one of 23 00:00:59,040 --> 00:01:01,000 the weirdest stories. In this version of Fail of the 24 00:01:01,000 --> 00:01:03,200 Week, we have Matthew McConaughey trademarking 25 00:01:03,200 --> 00:01:05,880 himself. He's made a trademark of himself 26 00:01:05,880 --> 00:01:08,800 to fight AI misuse. We'll be looking at the full 27 00:01:08,800 --> 00:01:11,680 details of what exactly he's trademarking and how this helps 28 00:01:11,680 --> 00:01:15,080 protect him from AI abuse. So we have a ton to get to in 29 00:01:15,080 --> 00:01:17,000 this episode. And if you haven't already, go 30 00:01:17,000 --> 00:01:19,920 to qualtrm.com and try out a free trial. 31 00:01:19,960 --> 00:01:22,000 It is the best stock analysis platform. 32 00:01:22,240 --> 00:01:25,360 Qualtrm has charts and graphs that are easy to use and easy to 33 00:01:25,360 --> 00:01:27,480 visualize. Qualtrm has news of recent 34 00:01:27,480 --> 00:01:30,440 events catching you up to speed on what's happening with every 35 00:01:30,440 --> 00:01:33,200 company in your portfolio. Qualtrim has an advanced watch 36 00:01:33,200 --> 00:01:35,600 list with a dip Finder feature that shows you which of your 37 00:01:35,600 --> 00:01:38,400 companies are in a dip and which ones are in a price surge. 38 00:01:38,400 --> 00:01:41,760 Qualtrim has summarized earnings called transcripts by topic to 39 00:01:41,760 --> 00:01:44,080 make it easy to browse what's going on with a company. 40 00:01:44,120 --> 00:01:47,160 It also has a DCF calculator that's super easy to use, a 41 00:01:47,160 --> 00:01:49,240 portfolio analysis tool, and more. 42 00:01:49,360 --> 00:01:52,000 Try it out risk free at qualtrim.com. 43 00:01:52,080 --> 00:01:55,120 Now, as we jump into today, you'll notice that my stock 44 00:01:55,120 --> 00:01:58,080 brokerage account is lower than it was just a day ago. 45 00:01:58,320 --> 00:02:00,560 It's quite a bit lower. In fact, we're down around 10 to 46 00:02:00,560 --> 00:02:03,600 $15,000. Just on the day I was actually 47 00:02:03,600 --> 00:02:08,280 getting near $1 million. We were only $7000 away from a 48 00:02:08,280 --> 00:02:11,920 million. Now we're $32,000 away. 49 00:02:11,960 --> 00:02:15,600 Just today, as of right now, we are down $10,000. 50 00:02:15,680 --> 00:02:17,880 If I move to the Story Fund, you see the same thing. 51 00:02:17,880 --> 00:02:21,880 If I look at the past day, we are down $7400. 52 00:02:21,920 --> 00:02:24,720 And this isn't just one company. A lot of companies are selling 53 00:02:24,720 --> 00:02:27,240 off today. Meta, Google, NVIDIA, Apple, 54 00:02:27,480 --> 00:02:30,440 Microsoft, all the big tech companies, all the NASDAQ 55 00:02:30,440 --> 00:02:33,840 leaders, all the AI winners, plus even software companies 56 00:02:33,920 --> 00:02:36,600 into it's down big on the day. Salesforce is moving down a 57 00:02:36,600 --> 00:02:40,200 little bit today. Adobe just hit a 52 week low. 58 00:02:40,200 --> 00:02:42,200 There's no love for Duolingo in this market. 59 00:02:42,200 --> 00:02:45,320 It continues to trade down. Companies big and small today 60 00:02:45,320 --> 00:02:47,320 are getting crushed in this market. 61 00:02:47,320 --> 00:02:50,080 The Dow Jones is down. The S&P 500 is down even more 62 00:02:50,320 --> 00:02:53,480 and down the most is the NASDAQ. The biggest winners are leading 63 00:02:53,480 --> 00:02:55,160 the losses today. So if you're looking at your 64 00:02:55,160 --> 00:02:57,640 portfolio today, it looks like a bloodbath. 65 00:02:57,640 --> 00:03:00,520 Many of your favorite stocks are probably selling down massively. 66 00:03:00,840 --> 00:03:04,480 And this is how investing works. This is exactly how it works. 67 00:03:04,600 --> 00:03:07,080 It's like Mike Tyson says, everyone has a plan until 68 00:03:07,080 --> 00:03:09,840 they're punched in the face. And if you have a plan with your 69 00:03:09,840 --> 00:03:13,520 investments, it's important to stick to that plan, even though 70 00:03:13,520 --> 00:03:15,320 today we're getting punched in the face. 71 00:03:15,320 --> 00:03:17,680 And when looking at both portfolios, when looking at the 72 00:03:17,680 --> 00:03:20,600 top companies to buy, four of them came to mind. 73 00:03:20,600 --> 00:03:24,000 The first one is Netflix. This is a company that I believe 74 00:03:24,000 --> 00:03:27,960 should be on the radar to be a purchase by any new investor. 75 00:03:28,240 --> 00:03:30,600 When we look at Netflix, there's a couple reasons that I outline 76 00:03:30,600 --> 00:03:32,760 this company. First of all, the price is way 77 00:03:32,760 --> 00:03:35,880 down from its recent highs. Netflix is going through a 78 00:03:35,920 --> 00:03:38,280 substantial dip. When I see a high quality 79 00:03:38,280 --> 00:03:42,160 compounding machine that recently traded at $133, it's 80 00:03:42,160 --> 00:03:45,680 now down to a price of $89.00 that catches my attention. 81 00:03:46,120 --> 00:03:48,280 I simply look at these situations and want to learn 82 00:03:48,280 --> 00:03:50,640 more about them. The news of any big acquisition 83 00:03:50,640 --> 00:03:53,360 will likely drag down the stock price of any company, and 84 00:03:53,360 --> 00:03:56,000 Netflix is no exception. But there's reason to believe 85 00:03:56,000 --> 00:03:58,720 that in this case, it's actually a benefit for Netflix. 86 00:03:59,200 --> 00:04:02,560 In the case of Warner Brothers Discovery, the acquisition makes 87 00:04:02,560 --> 00:04:04,320 sense. Warner Brothers Discovery 88 00:04:04,320 --> 00:04:08,520 represents high quality, prestige TV series that have 89 00:04:08,520 --> 00:04:12,280 incredible IP value. Intellectual property is so 90 00:04:12,280 --> 00:04:15,280 valuable in the world of content, and Netflix knows that. 91 00:04:15,360 --> 00:04:18,160 After all, much of what's watched on Netflix is licensed 92 00:04:18,160 --> 00:04:20,839 content from other companies, especially Warner Brothers 93 00:04:20,839 --> 00:04:22,840 Discovery. These are the series of movies 94 00:04:22,840 --> 00:04:24,920 that people love. Warner Brothers has an excellent 95 00:04:24,920 --> 00:04:27,560 box office business and they have an excellent streaming 96 00:04:27,560 --> 00:04:29,600 business. The problem with Warner Brothers 97 00:04:29,600 --> 00:04:33,520 Discovery is that when they were spun off from AT&T, they were 98 00:04:33,520 --> 00:04:35,640 dumped with an enormous amount of debt. 99 00:04:36,080 --> 00:04:39,800 So Warner Brothers Discovery, ever since this point in Q4 of 100 00:04:39,800 --> 00:04:43,840 2022, has had a staggering amount of debt, and that weighs 101 00:04:43,840 --> 00:04:45,760 on you. The interest expense of this 102 00:04:45,760 --> 00:04:48,720 debt weighs on you. Even with this huge amount of 103 00:04:48,720 --> 00:04:52,080 debt, they've spent the past years paying it down every 104 00:04:52,080 --> 00:04:54,320 single quarter, quarter after quarter. 105 00:04:54,640 --> 00:04:57,600 Now, while they're busy paying it down, they can't do things 106 00:04:57,600 --> 00:05:00,480 like invest in new shows, they can't expand their business, 107 00:05:00,480 --> 00:05:02,720 they can't expand in talent and technology. 108 00:05:03,000 --> 00:05:04,480 They're too busy paying down debt. 109 00:05:04,480 --> 00:05:06,480 And this is where I want to highlight an imortant 110 00:05:06,480 --> 00:05:09,160 distinction. The content of Warner Brothers 111 00:05:09,160 --> 00:05:13,000 Discovery in the actual business in terms of their assets and 112 00:05:13,000 --> 00:05:17,640 their production is excellent. It is top tier content and 113 00:05:17,640 --> 00:05:20,320 everyone that has access to the library knows that the 114 00:05:20,320 --> 00:05:24,440 financials, their current market structure is really bad. 115 00:05:24,720 --> 00:05:28,040 They have an enormous amount of debt that is causing them years 116 00:05:28,040 --> 00:05:31,040 of continual debt management. The reason that the Netflix 117 00:05:31,040 --> 00:05:34,280 acquisition makes so much sense is because Netflix will get the 118 00:05:34,280 --> 00:05:35,960 IP. They'll get the incredible 119 00:05:35,960 --> 00:05:39,240 content that'll really help out Netflix's library for the long 120 00:05:39,240 --> 00:05:42,960 term, and it also solves the problem of their bad financial 121 00:05:42,960 --> 00:05:44,800 structure. Netflix has the financial 122 00:05:44,800 --> 00:05:47,440 strength to pay for this acquisition and the debt very 123 00:05:47,440 --> 00:05:49,440 easily. This will not be something that 124 00:05:49,440 --> 00:05:51,920 holds it on the company from reinvesting back into the 125 00:05:51,920 --> 00:05:54,240 future. So I look at this as a situation 126 00:05:54,240 --> 00:05:56,560 where Netflix is solving the biggest problem with Warner 127 00:05:56,560 --> 00:05:59,600 Brothers Discovery, which is the financial situation while 128 00:05:59,600 --> 00:06:02,840 obtaining that incredibly valuable IP from their library. 129 00:06:02,920 --> 00:06:06,080 Netflix knows this and they want this deal badly. 130 00:06:06,320 --> 00:06:08,360 They already have a signed agreement agreement, and they're 131 00:06:08,360 --> 00:06:11,280 trying to protect themselves from the ongoing attempts from 132 00:06:11,280 --> 00:06:14,880 Paramount to block their deal or obstruct their deal or make it 133 00:06:14,880 --> 00:06:17,720 so that Netflix can't buy Warner Brothers Discovery. 134 00:06:18,000 --> 00:06:20,040 And Netflix is making moves to preempt this. 135 00:06:20,120 --> 00:06:22,520 David Faber on CNBC explains this fully. 136 00:06:23,160 --> 00:06:26,320 The vote is the key. It was not going to take place 137 00:06:26,320 --> 00:06:28,440 until the late spring or early summer. 138 00:06:28,600 --> 00:06:32,160 That will change should Netflix move forward with a change to 139 00:06:32,200 --> 00:06:33,720 all cash. Why? 140 00:06:34,200 --> 00:06:37,320 Well, when you issue stock, you've got to issue a lot more 141 00:06:37,320 --> 00:06:39,520 financials, a lot of accounting around it. 142 00:06:40,040 --> 00:06:43,480 And that just takes a lot of time, a lot of time, a lot of 143 00:06:43,480 --> 00:06:47,200 effort work, not to mention expense even for doing that. 144 00:06:47,320 --> 00:06:49,240 This makes it cleaner and quicker. 145 00:06:49,240 --> 00:06:51,960 And how much quicker? A lot, we're talking months. 146 00:06:51,960 --> 00:06:56,040 In fact. Again, unclear, but you could 147 00:06:56,040 --> 00:07:00,000 see a shareholder vote as soon as late February, early March. 148 00:07:00,000 --> 00:07:03,600 If in fact Netflix does this, you will get the proxy and you 149 00:07:03,600 --> 00:07:07,000 will get the date, but perhaps the proxy will come very soon. 150 00:07:07,040 --> 00:07:08,840 Again, that's the point I'm making here. 151 00:07:09,120 --> 00:07:12,440 The proxy itself would not be filed for quite some time if you 152 00:07:12,440 --> 00:07:16,440 were continuing to include stock in the transaction. 153 00:07:16,560 --> 00:07:19,320 That will change with an all cash offer and that will bring 154 00:07:19,320 --> 00:07:22,480 the question as to whether Paramount is going to raise and 155 00:07:22,480 --> 00:07:26,480 some and do something beyond suing and claiming it's being 156 00:07:26,480 --> 00:07:31,240 treated unfairly in order to try to win the day. 157 00:07:31,240 --> 00:07:34,840 That remains unclear at this point, but Sarah will have the 158 00:07:35,360 --> 00:07:38,960 effect of consolidating that timeline significantly. 159 00:07:39,120 --> 00:07:42,640 By moving from having their deal in part cash and part equity to 160 00:07:42,640 --> 00:07:46,680 straight cash, it clarifies a deal, it makes it simpler, and 161 00:07:46,680 --> 00:07:49,760 most importantly, it pushes the timeline forward for Netflix. 162 00:07:49,760 --> 00:07:51,440 Getting a vote on this by months. 163 00:07:51,800 --> 00:07:55,560 So Netflix is moving fast to close this deal down fast. 164 00:07:55,640 --> 00:07:58,920 The take away here is that Netflix is being aggressive in 165 00:07:58,920 --> 00:08:01,560 pursuing this deal. They know that Paramount is 166 00:08:01,560 --> 00:08:03,800 nipping at their heels. They're doing everything they 167 00:08:03,800 --> 00:08:07,440 can to steal Warner Brothers discovery from them and Netflix 168 00:08:07,440 --> 00:08:10,520 is not going to let that happen. But where does that leave us as 169 00:08:10,520 --> 00:08:12,720 Netflix investors? This has been a company that I 170 00:08:12,720 --> 00:08:15,280 have in the portfolio. I already have a decent holding 171 00:08:15,280 --> 00:08:17,560 in it and the stock doesn't seem to like this. 172 00:08:17,560 --> 00:08:20,640 In fact, investors seem to be selling out based on this news. 173 00:08:20,760 --> 00:08:23,120 I think investors and Wall Street have this wrong. 174 00:08:23,440 --> 00:08:26,400 Netflix should not be selling down on this news for a simple 175 00:08:26,400 --> 00:08:28,840 reason. Usually stocks sell down because 176 00:08:28,840 --> 00:08:31,160 they're becoming structurally weaker. 177 00:08:31,280 --> 00:08:34,159 For example, Salesforce is selling down over the past 178 00:08:34,159 --> 00:08:37,120 couple of months because the stock is becoming structurally 179 00:08:37,120 --> 00:08:39,360 weaker. With advancements in AI and 180 00:08:39,360 --> 00:08:42,760 coding, there's lots of other tools that are putting pressure 181 00:08:42,760 --> 00:08:46,000 on Salesforce, making it so that this company has to contend with 182 00:08:46,120 --> 00:08:47,720 all different types of competitors. 183 00:08:47,840 --> 00:08:50,280 Adobe's selling down and multiples are contracting 184 00:08:50,280 --> 00:08:53,360 because the company's becoming structurally weaker in the 185 00:08:53,360 --> 00:08:55,640 competitive landscape. They're now having to deal with 186 00:08:55,840 --> 00:08:59,600 the likes of Figma and the likes of Canva, big competitors that 187 00:08:59,600 --> 00:09:02,680 are taking market share on the low end consumer and on the 188 00:09:02,680 --> 00:09:05,360 design consumer. Adobe's in a structurally weaker 189 00:09:05,360 --> 00:09:09,120 position than it was a year ago. By contrast, Netflix's stock is 190 00:09:09,120 --> 00:09:12,560 selling down as the company's becoming structurally stronger 191 00:09:12,840 --> 00:09:15,240 with the acquisition of Warner Brothers Discovery. 192 00:09:15,600 --> 00:09:19,480 Netflix has simply won the game. There's no coming back from 193 00:09:19,480 --> 00:09:21,160 that. There's no alternatives. 194 00:09:21,520 --> 00:09:24,200 Netflix would have such a massive library that it would be 195 00:09:24,200 --> 00:09:27,480 indisputable. Can you even imagine the content 196 00:09:27,480 --> 00:09:30,160 that Netflix would have? Their production capacity would 197 00:09:30,160 --> 00:09:33,280 be unmatched. Netflix's streaming library 198 00:09:33,280 --> 00:09:35,680 would be unmatched. Their utility and ability to 199 00:09:35,680 --> 00:09:38,600 cross sell different pieces of content to different consumers 200 00:09:38,880 --> 00:09:41,600 of all varying tastes would be unmatched. 201 00:09:41,600 --> 00:09:44,600 Netflix is already the strongest media company in the world and 202 00:09:44,600 --> 00:09:48,080 this would only increase their power and make them stronger. 203 00:09:48,360 --> 00:09:51,120 So we have a company that's going down in stock price as 204 00:09:51,120 --> 00:09:52,920 it's becoming structurally stronger. 205 00:09:52,920 --> 00:09:55,960 Now, many of you may say, well, look, Disney bought a different 206 00:09:55,960 --> 00:09:58,280 company, and look how that's worked out for Disney. 207 00:09:58,280 --> 00:10:00,760 That's true. Disney's a big media company, 208 00:10:00,760 --> 00:10:03,600 and you may see some comparisons from the Walt Disney Company to 209 00:10:03,600 --> 00:10:05,520 Netflix. The difference with these 210 00:10:05,520 --> 00:10:08,840 comparisons is that the thing weighing down on Disney is not 211 00:10:08,840 --> 00:10:12,400 their streaming assets. It's not Fox, it's not Disney 212 00:10:12,400 --> 00:10:14,720 Plus. What's weighing down on Disney 213 00:10:14,720 --> 00:10:17,240 is their declining cable TV business. 214 00:10:17,680 --> 00:10:20,400 Without that, Disney would be a compounding machine. 215 00:10:20,520 --> 00:10:24,360 By contrast, Netflix is not buying any cable TV assets from 216 00:10:24,360 --> 00:10:27,240 Warner Brothers Discovery. They're only buying Warner Bros. 217 00:10:27,240 --> 00:10:30,400 They're not buying Discovery. So Netflix is getting just the 218 00:10:30,400 --> 00:10:32,800 good parts without getting any of the bad parts. 219 00:10:32,800 --> 00:10:35,440 This puts them in the strongest position possible. 220 00:10:35,640 --> 00:10:39,160 This makes competition even harder against Netflix. 221 00:10:39,240 --> 00:10:42,240 It strengthens their business without diluting it into secular 222 00:10:42,240 --> 00:10:44,480 declining businesses like cable TV. 223 00:10:44,480 --> 00:10:47,160 When I look at Netflix today, I see a company that's declining 224 00:10:47,160 --> 00:10:50,040 in stock price because of short term concerns, because of 225 00:10:50,040 --> 00:10:52,960 commotion, because investors think it's a dead stock for the 226 00:10:52,960 --> 00:10:54,880 next year. But in reality, this is a 227 00:10:54,880 --> 00:10:58,360 company that's moving step by step aggressively into a much 228 00:10:58,360 --> 00:11:00,400 stronger position in the media landscape. 229 00:11:00,400 --> 00:11:04,080 I think that Netflix is a buy today, right now, but I want to 230 00:11:04,080 --> 00:11:07,280 warn investors that this is a highly volatile company and this 231 00:11:07,280 --> 00:11:10,680 could go much lower. I could see on the low end, in 232 00:11:10,680 --> 00:11:13,640 fact I could, I could really see it happen where Netflix trades 233 00:11:13,640 --> 00:11:16,240 all the way down to around $70 per share. 234 00:11:16,840 --> 00:11:18,880 I think that's where we get to around the lowest end. 235 00:11:18,920 --> 00:11:22,720 The upside, by contrast, is very big for Netflix over the next 5 236 00:11:22,720 --> 00:11:25,000 to 10 years. If they secure the deal with 237 00:11:25,000 --> 00:11:28,120 Warner Brothers Discovery, if they get all the debt under 238 00:11:28,120 --> 00:11:31,600 control, which they will, and if they leverage their content at 239 00:11:31,600 --> 00:11:35,000 the scale of Netflix, we can see really big things from this 240 00:11:35,000 --> 00:11:37,120 company over the next 10 to 20 years. 241 00:11:37,320 --> 00:11:39,600 I see it multiples higher than what it is today. 242 00:11:39,640 --> 00:11:42,920 The second stock that is a buy today is JP Morgan Chase. 243 00:11:42,920 --> 00:11:45,240 And this is one that I haven't covered recently, but it's 244 00:11:45,240 --> 00:11:47,400 actually a company that I used to have in my port portfolio and 245 00:11:47,400 --> 00:11:49,960 it's a company that I made solid gains on in a short amount of 246 00:11:49,960 --> 00:11:51,640 time. I bought it during the COVID 247 00:11:51,640 --> 00:11:53,560 lows. I held it for a couple years and 248 00:11:53,560 --> 00:11:55,640 sold it for around a $15,000 gain. 249 00:11:55,720 --> 00:11:58,440 Like you'll hear many investors say, I wish I never sold the 250 00:11:58,440 --> 00:12:01,320 company because it's much higher today than it was then. 251 00:12:01,560 --> 00:12:05,600 The stock price has over doubled from $150.00 to around 350 now, 252 00:12:05,840 --> 00:12:08,160 but it's recently gone through a small pullback. 253 00:12:08,360 --> 00:12:11,280 Now, it might be surprising that I highlight JP Morgan as a buy, 254 00:12:11,280 --> 00:12:13,640 seeing that this is a bank and banks are typically not 255 00:12:13,640 --> 00:12:16,320 companies that I buy because they're looked at as more 256 00:12:16,320 --> 00:12:19,920 cyclical, less dependable. They are also black boxes. 257 00:12:19,920 --> 00:12:22,000 They're more difficult to understand, and that's 258 00:12:22,000 --> 00:12:23,680 traditionally what banks have been. 259 00:12:24,000 --> 00:12:27,160 But over the past five years, banks have really evolved and a 260 00:12:27,160 --> 00:12:30,200 couple things have changed dramatically under the hood of 261 00:12:30,200 --> 00:12:32,360 what's going on with JP Morgan Chase. 262 00:12:32,360 --> 00:12:34,800 The transition that's happened is that companies like JP 263 00:12:34,800 --> 00:12:38,000 Morgan, the largest banks in America, are looking more and 264 00:12:38,000 --> 00:12:40,680 more like tech companies. In fact, they don't really look 265 00:12:40,680 --> 00:12:43,840 like the traditional bank that takes in deposits and makes 266 00:12:43,840 --> 00:12:46,640 loans to make money. That's historically what banks 267 00:12:46,640 --> 00:12:49,040 have done. But instead, JP Morgan can now 268 00:12:49,040 --> 00:12:52,440 be looked at as more of a platform business that uses its 269 00:12:52,440 --> 00:12:55,640 banking charter to have an unfair advantage over 270 00:12:55,680 --> 00:12:58,200 traditional tech companies. And this is the same thing that 271 00:12:58,200 --> 00:13:01,040 Tom Lee has been arguing with the financials for some time, 272 00:13:01,320 --> 00:13:03,800 that investors are looking at them in an antiquated way, that 273 00:13:03,800 --> 00:13:06,840 they're simply banks taking in deposits and lending money. 274 00:13:07,120 --> 00:13:09,480 But that's not the business model of these banks today. 275 00:13:10,000 --> 00:13:13,760 Financial services companies are really big beneficiaries of AI 276 00:13:14,640 --> 00:13:17,880 and they're big beneficiaries of using blockchain technology. 277 00:13:17,960 --> 00:13:21,520 Both will allow them to reduce their employee intensity of 278 00:13:21,520 --> 00:13:24,320 their business. And so I think the large tech 279 00:13:24,320 --> 00:13:28,680 Ford banks are going to start to see margin expansion and trade 280 00:13:28,680 --> 00:13:30,680 more like tech stocks in the future. 281 00:13:31,280 --> 00:13:33,360 And that's why, you know, the JP Morgans and the Goldmans could 282 00:13:33,360 --> 00:13:36,080 actually be the next Mag 7. They are looking more and more 283 00:13:36,080 --> 00:13:37,880 like tech companies every single day. 284 00:13:37,920 --> 00:13:41,240 Part of what JP Morgan does is they take in deposits, they lend 285 00:13:41,240 --> 00:13:44,440 out money just like any other bank, and that does make up a 286 00:13:44,440 --> 00:13:47,480 big portion of their revenue. But there's also a lot of other 287 00:13:47,480 --> 00:13:50,080 aspects to what this company's doing and how they're earning 288 00:13:50,080 --> 00:13:52,960 real revenue inside the consumer segment of JP Morgan. 289 00:13:53,200 --> 00:13:56,560 The Sapphire credit card makes them around $29 billion 290 00:13:56,560 --> 00:13:58,480 annually. You have interchange fees, you 291 00:13:58,480 --> 00:14:00,320 have annual fees on their high end card. 292 00:14:00,320 --> 00:14:03,240 These are more tech like services than banking services. 293 00:14:03,360 --> 00:14:06,400 You have another huge segment of this $20 billion per year that 294 00:14:06,400 --> 00:14:07,960 they're earning through wholesale payments. 295 00:14:08,200 --> 00:14:10,360 This is very similar to the business model of Stripe. 296 00:14:10,360 --> 00:14:11,960 They're basically processing payments. 297 00:14:12,160 --> 00:14:15,320 They earn an enormous amount of money from doing that and 298 00:14:15,320 --> 00:14:18,680 Stripe, as we look at it, is not a bank company, it's a tech 299 00:14:18,680 --> 00:14:20,680 company. But JP Morgan has this type of 300 00:14:20,680 --> 00:14:23,800 business built into it, making up a significant portion of 301 00:14:23,800 --> 00:14:25,520 revenue. Then on top of those massive 302 00:14:25,520 --> 00:14:28,720 segments of their consumer cards, their branches, their 303 00:14:28,800 --> 00:14:32,320 Stripe like business, they also have wealth management services 304 00:14:32,320 --> 00:14:35,680 where JP Morgan handles money for super wealthy clients as 305 00:14:35,680 --> 00:14:38,360 well as many institutions. And then they also have 306 00:14:38,360 --> 00:14:40,960 commercial banking where of course, they give big loans to 307 00:14:40,960 --> 00:14:43,240 big businesses. They help different businesses 308 00:14:43,240 --> 00:14:45,080 go public. They help different businesses 309 00:14:45,080 --> 00:14:48,600 with all financial situations. The mix of revenue from JP 310 00:14:48,600 --> 00:14:51,800 Morgan has looked more and more tech like every single year. 311 00:14:51,800 --> 00:14:53,640 It's a higher quality revenue mix. 312 00:14:53,720 --> 00:14:56,880 And like Tom Lee says, as the company becomes higher margin, 313 00:14:56,880 --> 00:15:00,160 so should the valuation expand. When we look at the valuation of 314 00:15:00,160 --> 00:15:02,680 JP Morgan, there's also a couple things I want to point out here. 315 00:15:03,360 --> 00:15:05,840 If we look at a traditional bank, the way that you would 316 00:15:05,840 --> 00:15:08,680 value a traditional bank is by the price to book. 317 00:15:09,080 --> 00:15:11,520 And typically you'd look at a traditional bank and say that JP 318 00:15:11,520 --> 00:15:14,080 Morgan is rather expensive. It's trading at a price to book 319 00:15:14,080 --> 00:15:17,480 value of 2.3 times. That's much more than most banks 320 00:15:17,480 --> 00:15:19,800 that trade at 1 1/2 times or one times. 321 00:15:20,160 --> 00:15:24,840 So by the traditional bank metric, JP Morgan is expensive. 322 00:15:25,480 --> 00:15:28,280 But then if you value it the way that Tom Lee is looking at it 323 00:15:28,280 --> 00:15:32,320 from a tech perspective, you'd value it by PE ratios, which is 324 00:15:32,320 --> 00:15:34,600 what we commonly use for tech companies. 325 00:15:34,760 --> 00:15:37,040 And if you're valuing the company by its price to 326 00:15:37,040 --> 00:15:41,240 earnings, it looks rather cheap trading in the low teens, the 327 00:15:41,240 --> 00:15:44,320 mid teens of 14 1/2 Ford PE ratio. 328 00:15:44,840 --> 00:15:47,200 That is very cheap when comparing to almost any tech 329 00:15:47,200 --> 00:15:48,880 company. So whether you're valuing the 330 00:15:48,880 --> 00:15:52,280 company based on its PE or its price to book is determined by 331 00:15:52,280 --> 00:15:54,320 whether or not you're an investor valuing it based on a 332 00:15:54,320 --> 00:15:57,320 traditional bank metric or a tech multiple. 333 00:15:57,320 --> 00:15:59,760 And it's 1 worth considering to any investor that wants to have 334 00:15:59,760 --> 00:16:02,440 access to a massively profitable tech like bank. 335 00:16:02,440 --> 00:16:04,760 Now the third one worth buying today is Amazon. 336 00:16:04,760 --> 00:16:07,280 This is one that's been on my buy list for some time and it's 337 00:16:07,280 --> 00:16:08,920 also a large holding in the portfolio. 338 00:16:08,920 --> 00:16:11,840 There's a lot of different reasons to buy Amazon, including 339 00:16:11,840 --> 00:16:14,720 their growing advertising business, their mixed shift of 340 00:16:14,840 --> 00:16:16,400 higher quality revenues overtime. 341 00:16:16,680 --> 00:16:19,400 You can see that Amazon continually is growing in their 342 00:16:19,400 --> 00:16:23,040 third party seller services, their advertising subscriptions 343 00:16:23,040 --> 00:16:25,440 and AWS. But out of all of these reasons, 344 00:16:25,440 --> 00:16:27,600 I want to highlight too that I believe are the single biggest 345 00:16:27,600 --> 00:16:31,040 reasons to own Amazon today. The first one's Amazon Web 346 00:16:31,040 --> 00:16:34,680 Services, AWS. My thesis with Amazon is that 347 00:16:34,840 --> 00:16:39,600 AWS will continue to accelerate. I believe it will grow 18 to 19% 348 00:16:39,600 --> 00:16:42,640 over the next year and that accelerated growth will continue 349 00:16:42,640 --> 00:16:45,120 to push the stock higher. When we look at the customer 350 00:16:45,120 --> 00:16:48,120 commitments to AWS, those are growing faster than their 351 00:16:48,120 --> 00:16:51,280 current growth rate. We have 22% growth in customer 352 00:16:51,280 --> 00:16:53,880 commitments, which means that more people are signing up and 353 00:16:53,880 --> 00:16:56,400 signing contracts to use AWS in the future. 354 00:16:56,440 --> 00:17:00,520 The operating margins of it are also very high, 35, 5%. 355 00:17:00,800 --> 00:17:03,760 This is much higher than where Googles are or even Azures. 356 00:17:04,000 --> 00:17:07,160 This is incredibly high margins and they should go higher. 357 00:17:07,160 --> 00:17:10,160 But the other reason that I highlight Amazon as a buy today 358 00:17:10,160 --> 00:17:13,040 is because I think overall, when we can break down all the 359 00:17:13,040 --> 00:17:15,640 various things that Amazons doing, it has so many different 360 00:17:15,640 --> 00:17:17,800 touch points to people's lives every single day. 361 00:17:18,280 --> 00:17:21,520 But one of the big stories hiding behind the numbers is the 362 00:17:21,520 --> 00:17:24,000 automation. Amazon is a company that has an 363 00:17:24,000 --> 00:17:27,720 enormous amount of revenue, but very low margins overall because 364 00:17:27,720 --> 00:17:30,480 so much of their revenue is in retail businesses. 365 00:17:30,920 --> 00:17:34,400 This requires a lot of legwork, a lot of manual labor. 366 00:17:34,680 --> 00:17:39,280 Amazon employs roughly 1.5 million employees. 367 00:17:39,880 --> 00:17:41,720 That's a lot of employees. They're one of the biggest 368 00:17:41,720 --> 00:17:45,080 employers in the world. As automation continues to 369 00:17:45,080 --> 00:17:49,400 advance rapidly over the next 5 to 10 years, as robotics take on 370 00:17:49,400 --> 00:17:53,080 more of the legwork, the manual labor that many human workers 371 00:17:53,080 --> 00:17:56,680 are doing today, Amazon should be able to move faster, be able 372 00:17:56,680 --> 00:18:00,480 to ship packages better, have fewer complaints, fewer errors. 373 00:18:00,880 --> 00:18:03,040 They can also have fewer employees. 374 00:18:03,320 --> 00:18:06,400 Amazon can continue to grow the revenue while keeping the 375 00:18:06,400 --> 00:18:09,800 employee count flat, which creates operating leverage, 376 00:18:09,800 --> 00:18:12,640 increased margins. Not only does it have fewer 377 00:18:12,640 --> 00:18:16,560 employees, but it has fewer work time off, fewer lawsuits, fewer 378 00:18:16,560 --> 00:18:20,480 employees being hurt on the job, fewer health insurance claims 379 00:18:20,480 --> 00:18:24,040 and bathroom breaks, and so on. Employees are expensive for 380 00:18:24,040 --> 00:18:26,440 companies. Amazon has an enormous amount of 381 00:18:26,440 --> 00:18:30,000 employees, and having robotics be such a massive tailwind for 382 00:18:30,000 --> 00:18:32,600 this company, I believe is something that investors will be 383 00:18:32,600 --> 00:18:35,400 very attracted to over the upcoming years. 384 00:18:35,560 --> 00:18:38,800 Amazon today is worth over $300 per share, but it continually 385 00:18:38,800 --> 00:18:42,680 trades at around 2:30 to 2:40. Now it is going up in stock 386 00:18:42,680 --> 00:18:43,960 price. And I believe that it will 387 00:18:43,960 --> 00:18:46,000 continue to over the upcoming year. 388 00:18:46,080 --> 00:18:49,040 But I believe investors have a very attractive entry point here 389 00:18:49,040 --> 00:18:51,280 today. And #4 we have MasterCard. 390 00:18:51,280 --> 00:18:53,400 And for this one, I'll group it in with Visa. 391 00:18:53,480 --> 00:18:56,400 Both of these companies are under pressure recently as there 392 00:18:56,400 --> 00:18:59,480 is a new Trump social tweet where he said that he's 393 00:18:59,480 --> 00:19:03,080 interested in capping credit card interest rates at 10%. 394 00:19:03,160 --> 00:19:05,560 And this has caused a huge stir in the markets, not just for 395 00:19:05,560 --> 00:19:08,600 banks like JP Morgan, but also for Visa and MasterCard. 396 00:19:08,720 --> 00:19:10,680 Now, there's a lot of misconceptions about how 397 00:19:10,680 --> 00:19:12,520 Mastercard's business actually works. 398 00:19:12,800 --> 00:19:16,720 For one, MasterCard doesn't earn money on interest payments. 399 00:19:17,000 --> 00:19:18,840 So when you're paying your credit card bill and you're 400 00:19:18,840 --> 00:19:21,600 paying interest for late payments, MasterCard isn't 401 00:19:21,600 --> 00:19:24,440 making money from that. They only make a small amount of 402 00:19:24,440 --> 00:19:26,160 money every time you swipe the card. 403 00:19:26,440 --> 00:19:29,040 MasterCard is a tech company. They're not a lender. 404 00:19:29,040 --> 00:19:31,920 They are network focused on speed of transaction, connecting 405 00:19:31,920 --> 00:19:35,400 customers with merchants and banks and making sure the 406 00:19:35,400 --> 00:19:38,280 transaction goes through with fraud protection, with 407 00:19:38,280 --> 00:19:41,640 insurance, and with knowing who you're buying from and knowing 408 00:19:41,640 --> 00:19:44,480 who you're selling to. That is Mastercard's business. 409 00:19:44,480 --> 00:19:47,400 MasterCard and Visa are not in the business of lending money. 410 00:19:47,480 --> 00:19:50,640 Now, after Trump posted this, there is a huge buzz of news 411 00:19:50,640 --> 00:19:52,880 regarding it, and many people jumped on board. 412 00:19:52,880 --> 00:19:54,840 One of them was Senator Elizabeth Warren, who has 413 00:19:54,840 --> 00:19:57,560 proposed this for a long time. We also have other people even 414 00:19:57,560 --> 00:20:00,680 across the aisle like Josh Hawley that also support this. 415 00:20:00,960 --> 00:20:04,080 And there's other notable Democrats like AOC that support 416 00:20:04,080 --> 00:20:06,160 this as well. So there is a number of people 417 00:20:06,160 --> 00:20:09,280 in the Senate that do support this, but that number is 418 00:20:09,280 --> 00:20:11,200 limited. And that's what brings me to why 419 00:20:11,200 --> 00:20:13,120 I believe this company is a buy today. 420 00:20:13,560 --> 00:20:17,680 The concerns over a 10% credit card cap I believe are very 421 00:20:17,680 --> 00:20:20,280 misfounded. And I think the chances of this 422 00:20:20,280 --> 00:20:24,920 actually passing with a hard cap of 10% interest on credit cards 423 00:20:25,280 --> 00:20:28,480 is incredibly unlikely. The biggest problem with trying 424 00:20:28,480 --> 00:20:31,880 to make this work is what would happen in every case. 425 00:20:31,880 --> 00:20:35,840 If companies like Visa, MasterCard can't have any cards 426 00:20:35,840 --> 00:20:39,880 with over 10% annual percentage interest rate, then you would 427 00:20:39,880 --> 00:20:42,880 have of them not being able to lend to almost everyone. 428 00:20:43,000 --> 00:20:47,320 That is a sub 700 credit score. So if you have below a 700 429 00:20:47,320 --> 00:20:49,760 credit score, your credit card is gone. 430 00:20:50,240 --> 00:20:52,400 It's toast. There's no chance you're getting 431 00:20:52,400 --> 00:20:54,200 a line of credit. When you look at the outcome of 432 00:20:54,200 --> 00:20:57,320 this, do you think that your senator and your congressperson 433 00:20:57,560 --> 00:21:00,440 wants to be responsible for you losing access to credit? 434 00:21:01,040 --> 00:21:03,880 You not having your credit card anymore, you having to turn to 435 00:21:04,320 --> 00:21:07,360 loan sharks and buy now pay later applications? 436 00:21:07,520 --> 00:21:09,960 Do they want to be responsible for you losing access to 437 00:21:09,960 --> 00:21:12,440 something you enjoy using? No. 438 00:21:12,960 --> 00:21:16,080 On top of that, the other consequence of this is that 439 00:21:16,080 --> 00:21:19,360 credit card rewards for high income earners, meaning people 440 00:21:19,360 --> 00:21:22,840 that have above a 700 credit, people that have stable incomes, 441 00:21:22,840 --> 00:21:26,000 people that pay their bills on time, their rewards would go 442 00:21:26,000 --> 00:21:28,400 down. O this is a double whammy. 443 00:21:28,640 --> 00:21:31,560 Not only would a massive amount of people, millions of people 444 00:21:31,560 --> 00:21:34,760 would lose access to credit, but the people that earn rewards 445 00:21:35,080 --> 00:21:39,840 would also earn less rewards. So people above 700 credit and 446 00:21:39,840 --> 00:21:43,920 people below 700 credit would be harmed by this bill passing. 447 00:21:43,960 --> 00:21:48,200 Moderate Democrats do not want people to lose access to credit. 448 00:21:48,440 --> 00:21:50,480 They don't want to be responsible for millions of 449 00:21:50,480 --> 00:21:53,680 their constituents not having credit cards that they enjoyed 450 00:21:53,680 --> 00:21:55,840 using. And moderate Republicans don't 451 00:21:55,840 --> 00:21:58,160 like price controls from the central government. 452 00:21:58,400 --> 00:22:02,080 Moderate Republicans like free markets, they like competition. 453 00:22:02,200 --> 00:22:05,080 And in both parties, neither of them want to be looked at as the 454 00:22:05,080 --> 00:22:07,520 person that took away your access to a credit card. 455 00:22:07,520 --> 00:22:10,200 The the House Speaker, Mike Johnson already seems to realize 456 00:22:10,400 --> 00:22:13,320 the blowback that this would cause the unintended effects. 457 00:22:13,320 --> 00:22:16,040 He says, quote, you got to be very careful if you go forward 458 00:22:16,040 --> 00:22:18,600 in that and our zeal to bring down costs, you don't want to 459 00:22:18,600 --> 00:22:20,440 have negative secondary effects of that. 460 00:22:20,480 --> 00:22:23,320 They would just stop lending money and maybe they cap people 461 00:22:23,320 --> 00:22:25,920 on what they're able to borrow at very low amounts. 462 00:22:26,080 --> 00:22:28,360 Mike Johnson's being very careful with what he's saying. 463 00:22:28,360 --> 00:22:31,120 He's trying to balance not offending Trump, but he's also 464 00:22:31,120 --> 00:22:34,320 trying to point out that, look, there are some big things we 465 00:22:34,320 --> 00:22:37,040 have to be concerned about here and he's already highlighting 466 00:22:37,040 --> 00:22:38,760 some of these structural challenges. 467 00:22:39,080 --> 00:22:41,440 And Mike Johnson is exactly right here. 468 00:22:41,680 --> 00:22:44,640 If they go forward through this, millions of people lose credit 469 00:22:44,640 --> 00:22:46,960 cards. Credit card reward points will 470 00:22:46,960 --> 00:22:49,920 go down and the credit limits that people have will go down 471 00:22:49,920 --> 00:22:51,840 substantially. Not only could it be something 472 00:22:51,840 --> 00:22:54,360 that consumers don't like, but it also could negatively affect 473 00:22:54,360 --> 00:22:56,400 the economy. The digital economy is part of 474 00:22:56,400 --> 00:22:59,280 the reason that the stock market does so well that companies 475 00:22:59,280 --> 00:23:02,720 earnings grow is because people can easily and freely and with 476 00:23:02,720 --> 00:23:06,320 less friction transact. If you restrict that, you slow 477 00:23:06,320 --> 00:23:09,400 down transactions. So overall, this is incredibly 478 00:23:09,400 --> 00:23:12,280 unlikely to pass. And as a MasterCard shareholder, 479 00:23:12,280 --> 00:23:14,960 someone that's already bullish on this company, I believe that 480 00:23:14,960 --> 00:23:18,040 when the stock trades down because of political bickering 481 00:23:18,280 --> 00:23:21,480 and different posturing from the president or anyone else, that 482 00:23:21,480 --> 00:23:24,160 that's the time to buy. MasterCard and Visa are becoming 483 00:23:24,200 --> 00:23:26,920 structurally and strategically more important companies in the 484 00:23:26,920 --> 00:23:29,480 world and I believe that MasterCard even has a business 485 00:23:29,480 --> 00:23:31,720 growing outside of their normal Rails business. 486 00:23:32,200 --> 00:23:35,320 With the stock trading at five year low multiples, I believe 487 00:23:35,320 --> 00:23:37,920 it's time to buy now. Finally we get to some news that 488 00:23:37,920 --> 00:23:41,480 Google has an unfair advantage and this was outlined in this 489 00:23:41,480 --> 00:23:43,880 article from The Verge where they go over that. 490 00:23:43,880 --> 00:23:47,520 Gemini's AI will use what it knows about you from Gmail 491 00:23:47,520 --> 00:23:50,360 search and YouTube with personal intelligence. 492 00:23:50,360 --> 00:23:52,800 Gemini can give you a more personalized answer to your 493 00:23:52,800 --> 00:23:54,840 questions. They give an example here of how 494 00:23:54,840 --> 00:23:57,880 this personal intelligence can work like a real life example. 495 00:23:58,400 --> 00:24:01,960 They say that we needed new tires for a 2019 Honda minivan 2 496 00:24:01,960 --> 00:24:04,680 weeks ago. Standing in line at the shop, I 497 00:24:04,680 --> 00:24:07,080 realized that I didn't know the tire size. 498 00:24:07,520 --> 00:24:10,720 I asked Gemini. These days any chatbot can find 499 00:24:10,720 --> 00:24:13,600 these tire specs. But Gemini went further. 500 00:24:13,760 --> 00:24:17,000 It suggested different options, one for daily driving and 501 00:24:17,000 --> 00:24:19,800 another for all weather conditions, referencing our 502 00:24:19,800 --> 00:24:22,840 family road trip to Oklahoma that Google found and Google 503 00:24:22,840 --> 00:24:25,600 Photos. It then neatly pulled ratings 504 00:24:25,600 --> 00:24:28,240 and prices for each. As I got to the counter, I 505 00:24:28,240 --> 00:24:31,360 needed our license plate. Instead of searching for it or 506 00:24:31,360 --> 00:24:33,960 losing my spot in line to walk back to the parking lot. 507 00:24:34,440 --> 00:24:37,480 I asked Gemini and it pulled up the seven digit number from a 508 00:24:37,480 --> 00:24:40,560 picture in photos and also helped me identify the Van SEC 509 00:24:40,560 --> 00:24:44,720 trims by searching Gmail. Just like that, we were set, and 510 00:24:44,720 --> 00:24:47,640 now they're leveraging that enormous amount of data they 511 00:24:47,640 --> 00:24:50,640 have of you, all their photos, all your YouTube history, all 512 00:24:50,640 --> 00:24:53,720 the Gmail, to answer questions about you in a uniquely 513 00:24:53,720 --> 00:24:57,400 personalized way that nobody else can, Nobody else, including 514 00:24:57,400 --> 00:25:00,240 ChatGPT. This is so personalized that 515 00:25:00,240 --> 00:25:02,320 it's hard for me to believe that anybody else will be able to 516 00:25:02,320 --> 00:25:05,240 compete with this. ChatGPT certainly does not have 517 00:25:05,240 --> 00:25:07,680 this information. This is a massive point of 518 00:25:07,680 --> 00:25:09,920 leverage that Google has over ChatGPT. 519 00:25:10,400 --> 00:25:13,400 Another thing that we can point out is that this is exactly what 520 00:25:13,600 --> 00:25:16,600 Apple is supposed to do. Apple is supposed to have 521 00:25:16,600 --> 00:25:19,480 everything that they know about you with the iPhone, but Apple 522 00:25:19,480 --> 00:25:22,320 doesn't have the AI models, so now they're having to combine 523 00:25:22,320 --> 00:25:25,360 with Google and use their model. So Google's even winning with 524 00:25:25,360 --> 00:25:27,520 Apple. Over the past year, we've gone 525 00:25:27,520 --> 00:25:31,400 from Google having no answer to Chachi PT having a sluggish app 526 00:25:31,400 --> 00:25:34,920 failing and falling behind, to now having an app catching up 527 00:25:34,920 --> 00:25:37,400 and one that seems even structurally positioned better 528 00:25:37,400 --> 00:25:39,840 than Chachi PT. One that can leverage this 529 00:25:39,840 --> 00:25:43,080 immense amount of personal data to handle questions in a far 530 00:25:43,080 --> 00:25:45,920 better way for users than Chachi PT can. 531 00:25:46,040 --> 00:25:48,760 Now, finally, we get to the fail of the week, which in this case 532 00:25:48,760 --> 00:25:52,120 is a story of Matthew McConaughey trademarking himself 533 00:25:52,120 --> 00:25:55,760 to fight AI misuse. Matthew McConaughey is taking a 534 00:25:55,760 --> 00:25:59,040 novel legal approach to combat unauthorized artificial 535 00:25:59,040 --> 00:26:01,720 intelligence fakes he's trademarking himself. 536 00:26:01,720 --> 00:26:04,800 Over the past several months, the Interstellar and Magic Mike 537 00:26:04,800 --> 00:26:08,120 star has eight different trademark applications have been 538 00:26:08,120 --> 00:26:11,480 approved by the US Patent and Trademark Office featuring 539 00:26:11,480 --> 00:26:13,640 himself. His attorney said the trademarks 540 00:26:13,640 --> 00:26:16,640 are meant to stop AI apps or users from simulating 541 00:26:16,640 --> 00:26:19,760 Mcconaughey's voice or likeness without permission, an 542 00:26:19,760 --> 00:26:22,640 increasingly common concern of performers. 543 00:26:23,280 --> 00:26:25,320 Now, in this case, you're probably wondering what the fail 544 00:26:25,320 --> 00:26:27,840 of the week is here, and you may think that I'm referencing 545 00:26:27,840 --> 00:26:30,960 Matthew McConaughey as being the fail of the week, but I'm not. 546 00:26:31,040 --> 00:26:33,760 I actually think what he's doing here is totally defendable. 547 00:26:34,000 --> 00:26:37,360 I think it's reasonable Matthew McConaughey should have 548 00:26:37,360 --> 00:26:40,680 ownership over his likeness. The fail of the week is this 549 00:26:40,680 --> 00:26:45,480 ongoing story of AI making life harder for many people. 550 00:26:45,600 --> 00:26:49,320 Last week we saw people using AI to make these new pranks that 551 00:26:49,320 --> 00:26:52,720 are more disruptive to people. Now we see this continual theme 552 00:26:52,720 --> 00:26:56,120 of AI stealing people's voice, their likeness, their image, 553 00:26:56,320 --> 00:26:58,720 without giving any type of compensation to them. 554 00:26:59,160 --> 00:27:02,480 If you own anything in this world, if you have access and 555 00:27:02,480 --> 00:27:05,440 ownership to anything, it should be yourself. 556 00:27:05,800 --> 00:27:09,360 Your voice, your likeness should be what you own. 557 00:27:09,440 --> 00:27:12,400 In fact, I think that Matthew McConaughey is not only in the 558 00:27:12,400 --> 00:27:15,080 right here, but I don't think he should have to trademark 559 00:27:15,080 --> 00:27:17,120 himself. This should just be common law 560 00:27:17,120 --> 00:27:20,560 that he owns his own likeness. Now part of this is funny 561 00:27:20,560 --> 00:27:23,360 because the trademarks that he included are several of the most 562 00:27:23,560 --> 00:27:25,600 Matthew McConaughey things that you can include. 563 00:27:25,680 --> 00:27:27,680 One of them is him standing on a porch. 564 00:27:27,680 --> 00:27:30,400 Another is a three second clip of him sitting in front of a 565 00:27:30,400 --> 00:27:33,640 Christmas tree and the audio of him saying, all right, all 566 00:27:33,640 --> 00:27:36,760 right, all right. His famous line from 1993, dazed 567 00:27:36,760 --> 00:27:39,400 and confused. And Matthew McConaughey himself 568 00:27:39,400 --> 00:27:41,000 has spoken to why he's doing this. 569 00:27:41,240 --> 00:27:43,840 It's because my team and I want to know when my voice and 570 00:27:43,840 --> 00:27:47,000 likeness is ever used. It's because I signed off on it. 571 00:27:47,120 --> 00:27:49,680 Now he actually emailed it. But I just that's the way that I 572 00:27:49,680 --> 00:27:52,800 hear it when I'm reading it. And I don't know if now I'm 573 00:27:52,800 --> 00:27:55,560 going to have a lawsuit where where I own Matthew McConaughey 574 00:27:55,560 --> 00:27:57,800 money because of how great my impression was. 575 00:27:58,320 --> 00:28:00,120 But either way, that's what I picture him saying. 576 00:28:00,240 --> 00:28:02,640 They're actually not going after anyone's specific hair. 577 00:28:02,640 --> 00:28:04,960 They're trying to preemptively get ahead of this trend. 578 00:28:05,320 --> 00:28:08,120 The lawyers say that his likeness may or may not have 579 00:28:08,120 --> 00:28:11,480 been manipulated, but they hope that the trademarks can be used 580 00:28:11,480 --> 00:28:14,480 broadly against unauthorized duplications of them. 581 00:28:14,560 --> 00:28:17,360 The lawyers say that in a world where everyone is watching 582 00:28:17,360 --> 00:28:21,080 everybody scramble to figure out what to do with AI misuse, we 583 00:28:21,080 --> 00:28:24,080 have a tool now to stop someone in their tracks and take them to 584 00:28:24,080 --> 00:28:27,760 federal court. In this case, I 100% agree with 585 00:28:27,760 --> 00:28:30,160 Matthew McConaughey. And I believe it's a failing 586 00:28:30,400 --> 00:28:32,800 that we're getting to the point where people have to copyright 587 00:28:32,800 --> 00:28:36,760 their own image, something that they should already own, that 588 00:28:36,760 --> 00:28:39,040 people should not be able to manipulate and copy and 589 00:28:39,040 --> 00:28:41,080 duplicate without their permission. 590 00:28:41,200 --> 00:28:43,200 But that's all for this episode. Hope you enjoyed. 591 00:28:43,320 --> 00:28:44,040 See you in the next one.