🥂 Drunk Wisdom: Reflecting on market highs and lows over a sea of booze. Key lessons about taking a long-term view, and having a process to improve your process (the machine that builds the machine?)
💼 $AMZN Amazon’s Strategy Reboot: Deep dive into Amazon’s current moves in e-commerce and cloud services
🪙 $LINK Chainlink’s Future Potential: Exploring why Chainlink ($LINK) is a foundational player in Web3 and the crypto economy
📈 Palantir’s Playbook for the Future: How $PLTR is positioning itself in AI and data analytics, with potential as a long-term investment. Is there a case for a short position?
🔄 Compounding: The Real Magic of Wealth Creation and stories of how compounding works in practice and why it’s critical for every portfolio
🤔 When to Double Down on Risky Bets: Debating position sizes: When is it okay to exceed the “10% rule” for a single investment?
🚗 $TSLA Tesla’s trajectory for 2035 analyzed — bullish or blind optimism?
🛑 Bear Market Strategies: Coping mechanisms for surviving downturns and preparing for the next bull run
🏦 AI in Investing Platforms: The role of AI-driven insights in Robinhood $HOOD vs. SoFi $SOFI—who is leading the charge?
🏖️ Early Retirement in Your 40s: Is it a myth or achievable goal? Breaking down the math and mindset
🤝 Building Community Through Patreon: Growing the podcast community, Patreon updates, and how listeners can get involved
http://www.patreon.com/wallstreetwildlife
❓ Listener Questions:
• How do you deal with disinformation and misinformation as an investor?
• How should you manage a cash allocation in an investment portfolio?
🔔 Key Takeaways:
• Why patience matters more than timing in investments
• How drunk wisdom sometimes reveals bold truths about market strategies
• The risks of chasing “moonshot” stocks versus steady compounders
Segments:
00:00 Cold open
03:25 Investing Insights at the Bottom of a Glass
11:23 Dealing with Disinformation and Media Bias
17:37 Controversy Around Tesla and Elon Musk
23:30 Amazon: The Stock to Watch in 2025
35:12 Small Cap Companies and Portfolio Updates
43:37 The Case for Chainlink
51:11 Shorting Palantir and Market Strategies
58:07 Managing Cash Allocation
01:03:23 Stock Safari: Chainlink $LINK
01:04:14 Stock Safari: Groq (private company)
E55 – Drunk Wisdom AMZN LINK PLTR
[00:00:00]
[00:00:00] Krzysztof: People will literally manipulate the facts and the data because behind the scenes, they’ve taken a position that will benefit from their manipulation and lies. And I learned the very hard way. You cannot really truly know somebody’s motives because you don’t know what they’re doing behind the scenes.
[00:00:24] Luke: Welcome to Wall Street Wildlife with Luke and Christophe. On today’s episode, we’re going to revisit some controversy from our recent interview with Brad DeLonge. We’re going to talk about why 2025 belongs to Crypto is back. What’s the smartest play? Christophe is going to clue you in. He’s also shorting Palantir, a stock I’m long in.
[00:00:47] We’re going to get deep into that. I’m going to respond to a listener question about how to manage cash and I’m going to show you how I actually did that over the last cycle. And we’re going to go on stock safari once again [00:01:00] with a hot crypto stock from Christoph and I’m looking at an interesting private opportunity.
[00:01:06] Today is Monday, the 18th of November.
[00:01:10] Krzysztof: So from the bottom of our furry hearts, thank you to all of our current Patreons. Your generosity and joining the wall street wildlife jungle is helping us make the show even better. And we have all sorts of fun and wild plans for y’all in the future to support us, head over to patrion.
[00:01:27] com slash wall street wildlife, all patron questions go straight to the top of the queue. And we have more Patreon only insanity than ever before. Special shout out goes to Big Dan O and Matt T. Thank you fellas for joining our tribe. We look forward to getting to know y’all. Second point, maybe more importantly is, can you pronounce the big C word that you just, uh, about, uh, Brad DeLong?
[00:01:57] What did you say? Controversy. [00:02:00] Controversy. Oh, you are so British.
[00:02:03] Luke: Oh, it’s controversy where you guys come from. Okay. Widows.
[00:02:09] Krzysztof: You know what? The, the ultimate authority on these matters is Prince. And so, uh, listen to, to the way he sings it and it’s not your way. All right. That’s all right, friends. We’ll teach Badger how to use English before.
[00:02:25] Luke: You won’t hear any z’s in my speech. All right. Let’s get into it. Ton to talk about. Where do you want to start?
[00:02:33] Krzysztof: Yeah. So there I was minding my own business and before I know it, it’s Saturday afternoon and I see that Humble Badgers apparently drunk off his rocker in Vietnam. So while, so I try to take advantage of that situation by posting, uh, by going rogue and posting to our patron or only members.
[00:02:55] And meanwhile, I see that, uh, you [00:03:00] claim to have written something while drunk. So I then scurry over to the X platform, and lo and behold, what I read is Uh, nothing short, but a staggering work of genius.
[00:03:13] Luke: It’s very kind. They do say, uh, truth is found at the bottom of the glass. I think I found a nugget.
[00:03:20] Krzysztof: Did you ever?
[00:03:21] And so I wanted to read it because I think it’s this good. You wrote, I’ve been drinking for the last six hours, but here’s some truth for y’all. Investing is actually easy. You simply need to believe that you’re making good decisions. Have a toolkit that allows you to test and validate that what’s true and to be patient enough for the volatility to wash through eventually that approach has to succeed.
[00:03:50] Those three steps are in increasing order of importance. Three, patients will generally win regardless, even if you’re invested in [00:04:00] diversified dog shit as stocks simply go up in the long term. Two, test and learn is vital if you want to improve. That means keeping good records and regularly challenging your own thinking and decision making in one.
[00:04:17] Making good decisions is the least important bit, as long as you get the other two pieces right. Eventually, you will self correct and iterate and find your own path to beating the market. And you, dear Badger, have followed your own advice and have succeeded wildly. And you know what you wrote is true. Uh, it’s just so impressive that you wrote all that while drunk.
[00:04:45] So explain yourself. Is there anything you’d like to add?
[00:04:49] Luke: I think it’s pretty good, actually. I’m pretty pleased with it, like I reviewed it with some hair of the dog the next morning and I’m like, Oh, this is not bullshit. I buy this. Uh, so [00:05:00] I posted it everywhere else.
[00:05:01] Krzysztof: Yeah.
[00:05:01] Luke: Uh, actually it was from a, I plagiarized it onto X cause I was, it was just from like an investing WhatsApp chat I have with a couple of close friends, um, some of whom are newer investors and one of whom is like a long season investor, my buddy Albert.
[00:05:16] Um, and I was responding to a question from one of my friends, didn’t you? Um, and then sort of came up with a garbled version of this, and then in the taxi on the way home from like the fifth bar last night, two nights ago, uh, last night in Saigon, I’m now back in London. Well,
[00:05:30] Krzysztof: here it is anyway, right?
[00:05:32] Luke: Let me just explain why I think this actually is definitely true.
[00:05:36] And I, I might have to trademark diversified dog shit. I really liked that. But that was kind of my, my bigger point there was, uh. Like, in some ways, it doesn’t matter what you invest in, just fricking invest. Because even if you, like, if you’re diversified, even if you own like a bunch of stocks, you’re probably going to do okay.
[00:05:57] Even if you’ve chosen really shitty stocks, um, because [00:06:00] stocks go up and the market goes up. Um, but be diversified because like, if something really is dog shit, if you’ve got a whole ton of dog shit, like they’re probably all going to bomb. Um, yeah. And then I think, I think sort of controversy, controversial, controver, controversial, what the hell would you guys say?
[00:06:20] The controversial aspect is that actually making good investing decisions is like the least important part of the framework. Cause like, as long as you can analyze those decisions. and figure out why they were good or bad, you can learn as long as you’re trying to have a framework for learning and improving.
[00:06:39] Because if I go back and review, you know, 21 plus years of investing history, I made a bunch of crap decisions in the first 10 years, 15 years maybe. Um, but I improved and like I made some mistakes. Last cycle, just a couple of years ago. And hopefully I’m on top of them this cycle. Uh, so yeah, it’s like, and I’m making mistakes right now that I don’t [00:07:00] know about.
[00:07:00] I’m not so blind as to think that’s not the case. And I’ll learn about those in three or four years time. Cause I’ve got a framework for testing and learning and I just track everything. Diligently, uh, used to be in spreadsheets now in this tool called Port Sido. Um, and I can learn from my errors. So yeah, I don’t know.
[00:07:19] What do you reckon?
[00:07:20] Krzysztof: One, life is one long continuous mistake. And so that’s, that’s point one. And investing just allows you to see that more clearly. But that doesn’t mean you can’t succeed within the mistakes. That’s kind of what one of the things you’re saying. And the other thing I’d like to add is, uh, some of you might know that I’m, I’m a Zen practitioner and I teach it for now 15 years.
[00:07:47] And one of the best insights I’ve ever gotten from one of my teachers. It was when, when talking about what meditation is and how it works, we now know it’s been kind of appropriated and culturized and all, there’s all these [00:08:00] classes and theories and books and blah, blah, blah. My teacher always, often asked us before meditating, how simple are you willing to let it be?
[00:08:13] And that’s kind of both what’s maddening, and I think this is what you’re talking about in your post, is that there are ways to make it the most complex, crazy thing ever. But there’s something fundamental underneath that if you stick to some very basic principles over time, they will guide you and you will succeed in the midst of failure.
[00:08:39] Luke: Like anything, you can apply, you could almost apply this same framework to anything in life, not just investing. Like practice a thing and eventually you’ll be good at that thing and then have a way just to like see if you’re improving or getting worse.
[00:08:54] Krzysztof: Right. Instant biofeedback.
[00:08:56] Luke: Yeah. Yeah. Yeah. Are you applying this to [00:09:00] anything in your life apart from investing?
[00:09:02] Krzysztof: Well that’s the, that’s uh, the maddening thing, you know, with any of life’s greatest difficulties. It’s one thing to know the theory and it’s another one to remember to apply the theory across different parts of life. But this stuff works all the time in relationships and Just wellbeing, you know, keep it.
[00:09:26] I mean, it’s not, it’s well, I think, yes, uh, it’s, it’s when I forget to do it, that, that the trouble starts, but that’s true for all of us. I think it has nothing to do with the practice itself. And it takes time also for anyone. Uh, we, this is a recurring theme for us. The real good, successful habits just take consistent practice to practice.
[00:09:57] And then if you immediately think you’re going to, [00:10:00] you know, apply this for three weeks and then be set, sorry, that’s not how it works. It’s a lifetime’s journey and you just get better incrementally.
[00:10:08] Luke: Yeah, I guess we’re just lucky that, like, this thing we happen to be practicing can make a shit ton of money and change your life for the better in lots of ways.
[00:10:16] Uh, as opposed to, like, maybe slightly more artsy or ethereal things you might practice that make you feel, Uh, you know, wholesome, hopefully maybe a better point there is by getting this one, right? It gives you the freedom to go and practice all the other stuff.
[00:10:32] Krzysztof: Exactly. Yeah. And I’d like, maybe, maybe I’ll add one, one kernel here.
[00:10:39] I feel that what differentiates our show from many other financial podcasts is that whether we succeed or fail. I think we both have a pretty well developed capacity to name and see our mistakes without that kind of, um, you know, like to [00:11:00] override the, call it shame instinct or putting your head in the sand and denying reality.
[00:11:06] And if you could do that, then that’s kind of the whole game.
[00:11:12] Luke: Right on. So maybe that. Discussion takes us into some comments we got on a bunch of our Twitter and YouTube content over the last week or two. Um, and actually we got some controversial comments, but also a question, both relating to last week’s episode, which is our interview with Brad DeLong.
[00:11:31] Uh, alter of slouching towards utopia, maybe let’s pick up the disinformation topic. Uh, so we’ve got a question on the question of disinformation and the question was, so what do you suggest we do to deal with misinformation and disinformation that comes from ABC, CBS, MSNBC, and all the other main news stations.
[00:11:52] Um, and yeah, like that isn’t, that is an interesting quandary because we can all sometimes put ourselves into [00:12:00] a bit of an echo chamber as investors and it’s a trap of your own making that you’ve got to be really wary of. Do you want to kick us off on this one, Luke? What’s your thoughts?
[00:12:09] Krzysztof: This is a little bit in my wheelhouse since I teach rhetoric on the professional level.
[00:12:14] So I don’t want to get it all academic over y’all, but first point is echo chambers exist for a reason. We need it for survival. So. We need to know who our tribe is, because we need to know what our values are, right? Collectively, culturally, if you somehow wandered off and see the wrong tribe, you’re going to get your ass clipped to death.
[00:12:33] So you kind of have to, you know, make sure you’re basically telling yourselves the same story that that’s how you know you’re in your own tribe, right? So there’s a reason that echo chambers exist. My contribution to this topic is that we tend to think dualistically too often, meaning like, I’m sorry, more like in the binary.
[00:12:52] And you’ll hear on one side of this argument, like media bias, right? So you can’t trust the media, [00:13:00] right? So okay. And then therefore the conclusion is that something like expertise can’t be trusted. To me, that’s a false distinction. It seems clear to me now in 2024 that yes, there is massive bias in the media because it’s a profit driven enterprise and it knows its audience.
[00:13:25] So it’s going to speak to its audience. It’s not going to quite easily provide views that are run against its profit making motives true. And simultaneously, if somebody devotes their life to studying a particular topic and they do have the degrees and they do go to professional conferences, then it makes all the sense in the world that that person is more trustworthy and has better information.
[00:13:57] Then some knucklehead that’s gone on [00:14:00] Twitter for all of 10 minutes. And start spouting the fact, you know, spouting whatever the thing, uh, meme of the day is. So the pain point for me is how easily people try to, they confuse the media bias with saying nobody is trustworthy. That’s nonsense. Find the experts that have put in the work, don’t dismiss them immediately, have some skepticism, but assume that’s the best place to get your information.
[00:14:34] And then I imagine you’re going to say this, uh, sprinkle your perspective so that you’re not just getting one.
[00:14:43] Luke: Yeah, exactly. Particularly key as an investor, because let’s say you’re not just surfing like random ass news. You’re actually trying to understand the stock. Like you’re probably looking, it’s easy to fall into confirmation bias.
[00:14:56] You’re looking for like the bull case. Maybe you’ve done a bit of research already, you know, you’re [00:15:00] invested a few hours of your time. But you’ve got to go out and search for the bear case and what are the detractors and the shorts saying about that position and just kind of understand it, um, like be able to steel man it basically, you know, be able to present the best, most robust argument against the thing that you perhaps believe or you’re about to pull the trigger on.
[00:15:22] Because then, uh, you know, you might find, uh, disconfirming information that’s quite important because you, and you approach it with a different open mindset to both sides of the story.
[00:15:33] Krzysztof: And maybe this is what makes investing sometimes really hard, where I found in the past, anytime I’ve taken on a large position in something, which is the case for me right now, as you know, my portfolio is very weighted in a couple of positions only.
[00:15:49] It’s actually painful to come across information that runs counter to my. View that should make sense, right? [00:16:00] Psychologically. It’s hard to, to hear what you don’t want to hear, but it’s that much more important to force yourself to, to read those counter narratives, but then don’t go too far just because you read a counter position.
[00:16:15] Don’t forget that people are making money in both sides of the market. So they’re going to often, and this is maybe the darkest, the serious part of investing in 2024 in the current era. Is that with, you know, access to media that’s at anyone’s fingertips, you’re going to, people will literally manipulate the facts and the data because behind the scenes, they’ve taken a position that will benefit from their manipulation and lies.
[00:16:42] And I learned the very hard way. You cannot really, truly know somebody’s motives because you don’t know what they’re doing behind the scenes. The only correction to that, I would say, is really over time getting to know people and you could kind of [00:17:00] make a character judgment, right? Okay, no, this is a good person, right?
[00:17:03] Like, I know that sounds a little squishy, but We’re human, right? I mean, we, there are limits to, you can’t distrust everybody. So, but if you don’t know somebody, question their motives, you don’t know what they are, and then find the experts that over time demonstrate they know what they’re talking about. I
[00:17:22] Luke: wonder if that, that comment leads us nicely into the second reflection on the Brad discussion.
[00:17:29] I think it might be a bit unfair. Like we posted a couple of shorts from the discussion and one of them Got like decent numbers, a couple of thousand views on YouTube. And it was an excerpt from quite a long conversation where Brad was talking about like what it means to be a Tesla shareholder. It’s quite, it’s Musk and Tesla.
[00:17:46] It’s quite controversial. It’s all in the news, right? I don’t know if he is or isn’t a Tesla shareholder himself. I have no idea. But he listed kind of five reasons why people might be Tesla shareholders. And in the short, [00:18:00] like we picked out one of those because it was quite interesting where essentially Brad was talking about.
[00:18:05] I suppose the professional way to discuss it would be like social signaling. People might be Tesla shareholders, um, as a way to express their affiliation with this sort of cultural and intellectual movement associated with Musk. And then, It was controversial, which is kind of good for the YouTubes, I guess.
[00:18:25] Like people dived all over that and said, basically, bullshit, this is not why people own Tesla stock. Um, and they’re right. But probably, probably to do justice to Brad, that was a excerpt from a much bigger piece. But, you know, we lean into the controversy. We like the controversy, Christoph. So, um, why were people so excited and het up about this?
[00:18:49] Krzysztof: I think it’s insulting on some level to say you’re a serious investor or you’re an investor, but you’re only doing it for mean clown [00:19:00] reasons, right? And we know Tesla is one of the world’s premier companies. So I could see why that would seem insulting to a lot of people. But, but especially now in November of 2024, we know that Elon Musk is not just a CEO.
[00:19:18] He’s actually Now, maybe one of the most powerful people in the world, both, uh, as a CEO and as a politician, which is kind of crazy to, to admit. So, I think the controversy is that most people engage in this binary thinking again. And say to themselves, the only way that people invest is in the market is to make money and there’s nothing else going on.
[00:19:47] But we know that’s not true. If we’ve studied human, human civilization, we had the tulip mania, right? The peak example of people in whatever was Amsterdam or [00:20:00] Netherlands. Risking their fortunes to buy frigging tulips because, because that was the, call it, uh, people just agreed with one another that tulips were the thing that was valuable.
[00:20:14] Obviously no foundational basis, but that is actually how money works. Whether you’re comfortable with that fact or not, money works only because we all agree it’s money. So here we have Elon, you know, kind of behind Dodge and Mean Coin crypto shenanigans in this kind of face of a new movement. I don’t think it’s like, it’s one part of investing in Tesla that is real.
[00:20:43] Luke: And again, let’s be fair to Brad. Like he called out multiple reasons why people might be Tesla shareholders. This perhaps was almost a tongue in cheek throwaway, this one about social signaling. And you and I are both Tesla bulls, right? We both own the stock, we’re both long [00:21:00] Tesla. And I don’t feel like I’m long it because I’m a speculator.
[00:21:04] That was one of Brad’s other reasons. I feel like I’m long tailed on that because, well, they’re just making the world better. Technological advancement, and It’s a great investment opportunity. Like, well, last week we had a fiery conversation about maybe Tesla being a hundred X from here. And I think I nicely ripped apart that position, uh, cause I had no way in hell that’s happening, but I definitely believe they are a multi bagger from here.
[00:21:31] Krzysztof: Yeah. I wouldn’t mind just a mere 10 X, so, so regardless, but to this point though, you and I would never invest, ever. In something meme ish, but just because Tesla has that as kind of part of its DNA, investing DNA, that’s something if you’re aware of that fact, and all of a sudden the stock starts ballooning beyond what [00:22:00] fundamentals suggest it ought to be worth.
[00:22:02] That’s in your favor, as long as you can take some profits when you realize that things are now in, call it, in a meme ish, uh, ballpark, and you use that to your advantage. I mean, that’s a little game theory stuff, you know, that’s a little trading stuff, which usually doesn’t apply, but I think in Tesla it does, or might.
[00:22:26] Luke: Yeah, right on. I would never endorse, like, trading in and out of a position, but I certainly do that at a big scale across my whole portfolio.
[00:22:35] Krzysztof: Yeah. And in this case, I think so. You know, I think the, the moral of the story is here is if you’re really open to the mix of reality, it’s never like pure and Tesla is one of the world’s most, uh, interesting and maybe complex or complicated companies now because of what’s happening on the political scene.
[00:22:58] And you have, yeah, half of the [00:23:00] United States, you know, backing the CEO of one company. And he’s very, uh, controversial and provocative. So of course there’s meme ish stuff going on. Like, to me, that’s not controversial, right? No need to take offense about that part of reality.
[00:23:18] Luke: Hey, we like the controversy and we like the challenge and the pushback.
[00:23:21] So like flame us with whatever you like and we’ll, we’re not afraid to lean into it.
[00:23:26] Krzysztof: Right. Just beware. I’ll throw some rotten bananas right at you.
[00:23:31] Luke: Should we, uh, should we turn the conversation to a company that is definitely not meme ish and I feel is set up to win 2025?
[00:23:39] Krzysztof: Indeed, when I saw this on our, uh, episode Ledger, I was like, Ooh, I want to, I want to hear this because this is juicy.
[00:23:48] This was, this is one of my most regrettable sells of all time. I hope they’re with like, yeah, I will go on the list, but selling all the multi billionaire companies I sold too early. [00:24:00] So tell me what, tell me all about why. 2025 belongs to Amazon. com. Tell
[00:24:08] Luke: me Badger. Well, I’m going to start with like, maybe a bad, not a bad reason, but like shit is going down.
[00:24:16] Um, like I think we’re probably going into a recession and I think we’re seeing signs of that right now. And so in a recession, like money is tight, household expendable incomes go down. People generally start looking to spend their money a bit more carefully. So this is going to be, if this really goes off hard, this is going to be devastating for all of our growth stocks, which is why I’ve got a ton of cash right now, but I’m looking across my portfolio and trying to say, like, which of my companies, which of my holdings are going to be more immune to recession.
[00:24:49] And I think Amazon definitely is. Like if you just think about. And I welcome your pushback on this that I think back to say the coronavirus pandemic and you know everyone’s stuck at home [00:25:00] wasn’t a recession like people actually had a ton of cash because they couldn’t spend it. Companies like this that sell cost effective goods at, um, like a margin.
[00:25:11] That beats the majority of their competitors are likely to prosper in an environment like that. And Amazon have set themselves up really nicely for this part of my bull thesis right now. Don’t know if you saw news about Amazon whole, um, so they’ve got like a new product set, which essentially. I, I don’t, I haven’t gone like super deep to understand their manufacturing.
[00:25:37] I think this is like, essentially like cheap Chinese knockoffs, like super cheap products to compete with the likes of Shine, like the fast fashion guys and Temu and companies like that. Essentially, I suppose it’s like the latest breed of Amazon basics where they just got like their own in house, well, in supply chain constructed [00:26:00] stuff.
[00:26:00] Which they’re selling at less than 20 bucks a go, and then trying to take over even more and more of the market. This is, it feels to me, with recession coming, this is, uh, a winning strategy for them right now. I’ve got a bunch of other stuff I’ll talk about too, but I’ll give you a chance to apply it on that.
[00:26:17] Krzysztof: Sure, I’ll go the personal narrative route, because I was reflecting on this just the other day. I live in Austin so it’s kind of a tech hub now, but it is, it blows my mind that I can put in an order for pretty much anything and it sometimes arrives only a few hours later. Usually it’s a day, right? But sometimes it’s mere hours.
[00:26:45] That’s just really sci fi crackpot shit. If you really think about it, anything, mostly anything, that’s one. And so your point about the recession and how useful this kind of thing will be [00:27:00] is Great. But then I also was in a local bookstore as sometimes I’m, I want to be, and there’s a little bit of that moral dilemma for me, because this little local bookstore is a beautiful, you know, artisan mom and pop shop.
[00:27:20] It’s human connected and of course all its books are way more expensive than what Amazon can sell for. So what I found, like, so what I found that I now do is I determined to find. Let’s say I pick out five books I want to get. I’ll find the one that is kind of closest to the Amazon price. And that’s the one I’m going to buy.
[00:27:44] One or two from the bookshop and then the rest I put in my cart and, you know, save a hundred dollars. Uh, and also I use the Amazon platform to read the reviews, right. And all the comments. So Amazon, all, all I’m [00:28:00] saying is like this company is integrated into our lives in a way that I can’t see being disentangled from.
[00:28:05] Luke: Yeah, a hundred percent. And I, I watched a couple of videos earlier today of their latest, it’s a 12th generation. Yeah. Full filaments center design and like the robots and all the different hacking systems and how the whole workflow works. It’s incredible. Like their latest iteration. So you think it’s amazing.
[00:28:24] You’re getting stuff and I’m getting stuff too, like same day within a couple of hours. Like they’re building this new facility. It’s the first one they’re launching. I think in the building, their latest. Uh, Advanced Fulfillment Center in Louisiana. And like this new design is going to reduce shipment time by another 25 percent and generate 25 percent cost improvements.
[00:28:48] How does anybody compete with Amazon? Well, you don’t have to, cause now you use Fulfillment by Amazon. These guys have just got commerce sewn up. And then another little thing I saw as well, they’re [00:29:00] just. Probably the, the small little thing that triggered me into going, Oh, let me just go review why Amazon are winning here.
[00:29:05] And I came up with my, why they’re going to win next year. They’ve just got a bunch of really nice gen, generative AI. And tools for sellers now. So I’m always tempted to go that we should create some wall street wildlife merchandise and a set up on Amazon. We can use some of these tools. Um, so now I think with the latest set of tools I’ve released recently, you take literally like a still photo of your thing, whatever it might be like my bottle of water right here.
[00:29:33] And, uh, you. Plug it into Amazon’s advertising model and it will create like glamorous videos of your water, you know, with all your product labeling and everything being, you know, drunk by beautiful people and maybe, you know, floating down a river and I like you just create like super compelling marketing.
[00:29:54] Video and audio and voiceover from a couple of still photos. Geez. I’m going to question [00:30:00] tons to do that years ago.
[00:30:02] Krzysztof: Are these beautiful people as beautiful as we are?
[00:30:04] Luke: Maybe
[00:30:05] Krzysztof: we need
[00:30:05] Luke: these. We’re talking actual beautiful people. Not if you’re, if you’re not on the YouTubes, like, get on the YouTubes and check out, give us a closeup of this beard.
[00:30:14] I, I’ve forgotten to talk about it on air. Like I comment on it every week when I see you. Look how gray you are. Fucking hell, Chris . You like this old wise monkey. Now with his ,
[00:30:26] Krzysztof: I’m turning into a wise gorilla. Uh, old, old crotchety gorilla. I see an investment mistake, though, that I’m already making in my head that I want you to, to address, uh, regarding Amazon.
[00:30:41] I buy everything you’ve just said and my monkey mind says, yeah, it’s too late. It’s too late and it’s too big and I’m looking at, you know, the market cap is 2. 14 trillion. And there’s this feeling, you know, uh, because I used to [00:31:00] be a shareholder and then I sold out and I missed all these gains. There is this psychic force that says, Sorry, the mistake is kind of lodged forever, never that it shall thou again be a shareholder.
[00:31:13] Tell us why this is, this is foolishness.
[00:31:17] Luke: Yeah, that’s just wild foolishness. Like, yeah, as you said, Amazon is a 2 trillion market cap company. Tesla is a 1 trillion market cap company. Like in my mind, it’s going to be hard for Tesla to pass Amazon. I mean, I know they’re doing a bunch of other stuff. Amazon already have hundreds of thousands of robots in factories doing stuff and helping their gross margins massively.
[00:31:42] Um, have you missed the boat? Like the stock has been all over the place. Let’s take a look at their market cap. You see that Christophe from Finch. So,
[00:31:51] Krzysztof: uh,
[00:31:51] Luke: yeah, so here they are today. They’re like a 2. 1, 3 trillion company. Um, [00:32:00] and yeah, for sure. Like if you want a price anchor on their market cap, which was sub 1 trillion just at.
[00:32:09] Like the end of 2022. Yeah. It’s up big since then. But, um, like this company is not the same company is still growing. It’s. Um, global footprint and it’s increasing its technology and it’s really improving like gross margins. Unless we didn’t talk about AWS, right? They’re winning the battle with AWS. Like this, I mean, just you’re, you’re the technical guy.
[00:32:33] I don’t like looking at technicals, but look at just the pick, the shape of this thing, right? This doesn’t look like it’s market cap today is way above. Out of bounds from where it has been historically, like, what, you know, what do you do? You guys draw like lines and shit. I can’t do that on my browser.
[00:32:48] But if I just draw like a line from there to there, uh, you know, the trajectory of the market cap, it sort of feels like it’s probably within, you know, one of your, one of your shapey things that you’d normally [00:33:00] draw with cups and handles and whatever. Doesn’t feel egregious. Right.
[00:33:04] Krzysztof: Yeah. Not bad here. This is easy.
[00:33:06] This is, this is one of the ways, forget the cuppy shapey handle things. All you need to see. Is that on the bottom left of the photo, it’s the, the dot is low. And then it just, you could draw a straight line and it’s going up into the right. That is the fundamental point. That the business is growing and it’s moving in the direction that you want it to.
[00:33:30] There’s a big dip, but that doesn’t matter because it regains the upward momentum. So, uh, this, you know, actually reminds me of another big mistake that I think both of us made, I think for good reasons, but, uh, when Nvidia caught fire. However, a year ago, whatever, was the inflection point. One of the main reasons I sold was because of how big it had gotten.[00:34:00]
[00:34:00] And I said the law of large numbers eventually, like gravitational force, like it could only get so big. But we’ve been wrong. You know, egg on our faces. I sold out completely because I guess when you invent the new paradigm shift on which the entire world runs. Then the company can get way bigger than you thought, and it might bring you the case.
[00:34:25] That’s what you’re saying here, that Amazon has put itself into position of kind of maybe taking out most brick and mortar stores, right? Like in the, within the decade or whatever.
[00:34:37] Luke: Yeah. Yeah. I mean, I’m, I’m a happy prime member for like a decade now and an Amazon shareholder. I feel like a bit of a schmuck because I’ve just gone through what I think is a strong bull case for Amazon, even from today’s valuation, but I’ve just, I’ve sold a bunch of Amazon not because I wanted to, I kind of had to, cause I was moving some money around, but I’m definitely in the mode of wanting to re add to that position.
[00:34:59] Krzysztof: Well, [00:35:00] thanks for putting this on my to buy list. As soon as I get out of my. small cap situation I’ve got myself into. It’s, it’s really at the top of the list. Right Saf.
[00:35:13] Luke: Well, I think on the docket, you’ve got a couple of your small cap companies you want to talk about.
[00:35:17] Krzysztof: Sure. Uh, as promised, I’ll be talking about how I invest 50 every single week, this, uh, round two of king of the jungle portfolio challenge.
[00:35:28] And, uh, to my great detriment, when it was time for me to, to, to pick my shares. I could not, again, resist buying more shares of Coherus. Uh, so I added, uh, a couple. And I, 10, I think, to be exact. And at the time I was making these purchases, Relight Therapeutics had this massive down day because the market was throwing a hissy fit about interest rates.
[00:35:55] That I expect to be, uh, a 10x within a couple years. So [00:36:00] I picked up more shares of Relight Therapeutics. And thanks to one of our Patreons, uh, Steve, he really, uh, put ASTS on my radar. I did a stock safari deep dive, I’m sorry, stock safari initial overview into the company. I really liked what I saw. Then they had earnings.
[00:36:20] It was quite bullish, even though the stock, uh, stock fell something like 13 percent because of momentum trading. And so at that time I picked up my first introductory share to ASTS mobile thesis there that they’re revolutionizing how people get cellular service via satellites, throwing them up in into space via SpaceX.
[00:36:44] So, uh, now I have five shit co companies. That’s insulting because ASTS is like 8 billion. Like
[00:36:54] Luke: you’ve got diversified dog shit. You’re fine. You’re going to do great.[00:37:00]
[00:37:02] Krzysztof: Yeah. Diversified dog shit plus Tesla. So anyway, uh, if, uh, you’re new to our show, check us out on patreon. com. Uh, slash Wall Street Wildlife because we link to our live King of the Jungle portfolio and you could see our actual percentage allocations to the minute.
[00:37:22] Luke: Uh, did you do anything? Uh, no. Did nothing.
[00:37:27] No. That is so boring. So much. I do. I did. I was just because I’ve been traveling and actually I have done some stuff in my real portfolio. That’s been my focus. Right. Because that’s a bit more important. But, um, I will. So I did have my learning point in our portfolio. One year review episode was I’ve got too much cash in my king of the jungle portfolio, so I’m going to invest that so yeah I will power some some money into my king of the jungle portfolio before our next episode I’ll reinvest a ton of it probably yeah, so
[00:37:58] Krzysztof: yeah, I was gonna say let’s see [00:38:00] if you walk the walk Yeah,
[00:38:01] Luke: definitely, definitely Amazon and a few others.
[00:38:04] Oh, you, uh, last week you were saying you were thinking about transitioning to Robinhood. Did you manage to do that since we last spoke?
[00:38:11] Krzysztof: Yeah. So it’s been, been a bit of a clusterfuck, uh, sadly, uh, I found, so then the, so this is for most of our beginner, uh, investors, I think Robinhood is maybe the fanciest platform out there.
[00:38:23] I’m really loving it, especially the new legend platform. It’s really nuts. It’s good, but you could only have one investing account because it’s tied to taxes and your social security. So I thought I found a little bit of a loophole. Because it allows you to, to create a new secondary account. That’s a joint account.
[00:38:43] And so I talked to the lady and totally fine. So we set up a joint account and that’s fine. That’s totally fine. All, all above water. And then
[00:38:54] Luke: she has like this, like, Margin, short position, all of these like random ass companies. [00:39:00] She’s getting margin called. Her car’s going to get taken away.
[00:39:05] Krzysztof: Right. Yeah.
[00:39:05] With all of these shit code diverse companies you own. So I was not thrilled with SoFi over the initial year. It’s just clunkier. It’s nowhere near as good as Robinhood, but they took away my crypto from me. And as you’re about to hear in greater depth, I really, really want more. Exposure to specifically one of these crypto things.
[00:39:31] So I transferred the account and damn it all to hell for whatever stupid reason, they put all of my shares that I had in SoFi into my old existing Robinhood account. So, so basically fudged up all the things. So I was bit, so you know how I solved that problem. I basically re bought all of the shares that I owned in [00:40:00] SoFi into the joint account.
[00:40:02] So I basically bought more Coherence, more EOS, more Relay, more to all of the things. But now, so now the math is a little off because in that transition. Like how much cash I had. I’m like, there was like some like 20, 30 worth of weirdness. So, you know, Yeah,
[00:40:23] Luke: like be, be, be optimistic and just add like a bit of extra money to cover your transaction charges.
[00:40:28] Like, you know, you need every bit of help you can get. Right.
[00:40:31] Krzysztof: The gap right now is, is unpleasantly wide. So anyway, long story short. Uh, I’m going to be using Robin Hood for King of the Jungle now, but I, oh, punchline is, after all that, I learned that I can actually buy crypto in a joint account.
[00:40:52] Luke: Because it’s a joint account?
[00:40:54] Krzysztof: Because it’s a joint account.
[00:40:56] Luke: Oh, wow. All right.
[00:40:57] Krzysztof: So in this moment in time, I don’t know if that will [00:41:00] change, but the only thing I could buy is stock. So I did all of that in, in, in part for nothing because my main objective was to buy crypto for King of the Jungle. And that leaves us with a question, and this is a serious one.
[00:41:15] You’re going to hear me give the spiel for For the crypto purchase I want to make again, how do you think I might do this? Because this is my really top idea in real life. So I want to talk about it. I want people looking into it, but if I can’t buy it for king of the jungle, that sucks. So do you think I could kind of maybe like fudge the math a bit and say, uh, like not fudge the math, but let’s say I buy it in my real world account, but you know, take, you know, I’ll, I’ll document the purchase and just include it on the spreadsheet.
[00:41:50] as belonging to King of the Jungle, but it just won’t show up in my King of the Jungle, you know, portfolio.
[00:41:58] Luke: I understand. I’m not, I’m [00:42:00] never going to audit you. Right. Uh, so you can, if you want. If you do that, then maybe. You know who’s winning. He knows who’s winning. You know, if you do that, I should be allowed to stick my SpaceX allocation in my King of the Jungle as well.
[00:42:13] I
[00:42:13] Krzysztof: think so. I
[00:42:14] Luke: don’t know if I can make a way to come back.
[00:42:17] Krzysztof: Well,
[00:42:17] Luke: no, I,
[00:42:17] Krzysztof: I, I think
[00:42:18] Luke: theoretically you should be able
[00:42:20] Krzysztof: to.
[00:42:21] Luke: As long as, you know what, Okay, okay. But it’s got to be stuff that’s accessible to our listeners, right? Because that’s the purpose. Right. Correct. For that reason. Okay. You know, you, you fudge this spreadsheet however you see fit.
[00:42:34] I’ll trust that you’re being ethical.
[00:42:37] Krzysztof: Okay. So let’s say this, that for our king of the jungle purposes, we want all our listeners to be able to make money. And it’s kind of just user interface problems that we need to communicate to you what we own. Okay. So, in the end, the spreadsheet that is on our Patreon, that is our Google spreadsheet, is the [00:43:00] bottom line of what we actually bought and invested in King of the Jungle, for King of the Jungle purposes.
[00:43:07] Where it actually lives. In theory, in our real world, I guess it ought not matter because we’re just telling you what we think is the best ideas, right? So going forward, I think what I’m going to do is actually buy some more of my crypto in my real world stuff, but allocated as though it’s king of the jungle and I’ll just keep good numbers.
[00:43:28] Luke: Okay. Yeah. Cool. Yeah. Okay. Don’t worry about any of that. Yeah. I will trust that you’re being straight with the numbers. Yeah, mostly. Let’s get specific then to what is this fantastic crypto idea that you’re literally turning everything upside down and pestering your wife just so that you can buy like a couple hundred bucks off for king of the jungle.
[00:43:51] Krzysztof: Indeed. So you’ve already heard me talk about this, but I now have a sense deep down. That people are not [00:44:00] listening to what I’m saying, or not taking it seriously enough. And now, because of Trump’s election, we are at the beginning of fixing the regulatory issues around crypto that have been, I would argue, holding this back.
[00:44:19] I’m talking about Chainlink, and I have so much to say about this that we’re not going to fit it all right now. But this is kind of a prelude, because we’re also anticipating having a guest that wrote some really. Uh, deep, insightful, uh, white papers about Chainlink. Here’s what I want our listeners to understand right now.
[00:44:40] Most of crypto is garbage. Ignore all of that. There are three crypto projects that to me have the seriousness and the fundamental backbone of something like a world class company. You know what those [00:45:00] three are. The original Bitcoin, which has its own financial use cases. The best performing asset over the last, whatever, how, 15 years, Ethereum, which is sort of like the Microsoft of software of crypto.
[00:45:15] And now you have Chainlink, which is at the very, very, very beginning stages of allowing all of the world’s institutions, financial and crypto, to put, to tokenize. their assets, turn all assets into smart contracts that then take advantage of blockchain technology. The analogy I like to say, because it’s so mind boggling, is that this is like, somewhat like investing into, in the internet itself.
[00:45:50] If the, you could buy shares in something like the internet, you’re buying shares of a protocol. So when I tell you, That the fundamentals [00:46:00] are real, and like that the world’s banks are all moving on this, and we’re not, we’re talking about a wave, a tsunami that is so huge that it’s kind of like mind boggling, right?
[00:46:14] It has nothing to do with crypto meme shit at all. So what I want our listeners to do at this, this moment in time, Is just look up Chainlink and go to their own webpage. Chainlink, uh, blah, I don’t know what the official site is. I’m sure we could put in the source notes. Won’t be hard to find. On X, they have an account that’s over a million, I think 200, 000 followers.
[00:46:38] And just begin to take in what this technology is building. One other point I’ll mention, this is a little bit of confirmation bias, but I’m big fans of the IO Fund. Beth Kindig’s fund. And, uh, those guys run [00:47:00] a real world portfolio and they use technical analysis to back up their, their trades. They’re down to something like 10 positions, mostly, uh, AI stocks.
[00:47:12] And one of their positions is Chainlink. And on the recent, uh, session, They said they expect Chainlink to maybe be one of their biggest positions of all time in the coming decade. So moral of the story, uh, uh, beasties don’t ignore my, what I’m saying to you and start your research into Chainlink now, because who the hell knows what, what, what this might work out to.
[00:47:45] And it’s funny because, because as we speak. It’s price right now is up 16 percent and Chainlink, Chainlink’s price volatility is all over the map because, [00:48:00] uh, weird crypto trading stuff. So it’s, it’s going to be massively up and down, but it’s kind of breaking out as I speak, which is very weird.
[00:48:09] Luke: Okay. All right.
[00:48:11] And I think we’re going to go a bit deeper on Chainlink in a future episode.
[00:48:14] Krzysztof: Yes. But can I press you on this, uh, badger? Because you are a sophisticated investor. You’re a technologist, you’re an optimist, and I’ve spouted about Chainlink now for, what, over a year? You’ve heard me going on about it, but I’ve never seen you, I think, correct me if I’m wrong, but at no point do you seem enthusiastic at all.
[00:48:37] And I wonder what, that’s what I mean, like I wonder what it is that you and the majority of our listeners, I’m guessing, hear what I’m, you know, monkeying about and you’re still like, nah. What’s the barrier do you think?
[00:48:53] Luke: I mean, for one, I’m not convinced crypto makes the world better. So it’s not something just on my radar.
[00:48:59] [00:49:00] Anyway, uh, I know there’s counter arguments to that, but I’m just not convinced it does. Um, and I own some, now mostly Bitcoin, um, just because I was doing some like tax stuff earlier this year. So most of my crypto is Bitcoin. That’s done great as are, but there’s like sub 1 percent in my portfolio, so it’s not material to me.
[00:49:19] I’m not sure about the whole, I used to be an Ethereum owner because I really brought the idea of tokenizing stuff and putting things on the blockchain and doing like transactions and real world things like processing, as opposed to just this, that in theory has value. Um, I’m not convinced the world is ready to really use any of that stuff in the, probably not in the next 10 years.
[00:49:45] Like all the, I’m open to the conversation we’re going to have in a few weeks time where we go much deeper, but all of the use cases I read, certainly when I went down the rabbit hole this a year ago. Which talked about, you know, like tokenizing [00:50:00] ownership of cars and houses and hoes and things like that.
[00:50:04] I don’t think any of them really hold water. Certainly you could do them, but I don’t think they are better. They’re like a solution looking for a problem. I don’t think they are better than existing centralized records for those kind of things.
[00:50:18] Krzysztof: Okay. So we will do, I promise you, we’re going to do lots of deep dives because this is my largest position in real life.
[00:50:26] The, what I’ll say now is the CEO of BlackRock. is on the record as saying the exact opposite of what you just said. So that guy is, you know, controlling more money than, than most people. And it’s already, uh, starting, I think, January Swift, the entire international banking system is already on the record as saying we’re starting to use it.
[00:50:52] So it’s no longer, Uh, very different story than even two years ago. What happens with Chainlink over the last, call it [00:51:00] six months, is the, the, the, the facts are the world’s going forward in this direction. So, um, grab a helmet.
[00:51:10] Luke: All right. Well, we’ve got a nice little pivot in our next conversation, because you are quite the Bearish on a company that I own and, uh, and then long currently.
[00:51:19] John, tell us why you’re shorting Palantir.
[00:51:23] Krzysztof: Yeah, it’s a little, this is tricky. I have not yet shorted Palantir. And I’m not like, this is what makes, uh, this question hard. I’m not bearish on the company. It’s just one of these, I think the valuation has gotten so stretched and we know this happens. And when I see that the insiders themselves are selling massive amounts of shares, uh, you know, I, we talked about keeping it simple earlier in the episode.
[00:51:55] Yes, insiders can sell for all kinds of reasons and [00:52:00] they buy for only one, right? But the flip side of that is the insiders know their company better than anybody. And so when there’s massive selling going on after this kind of huge run up in price that extended their market cap by like, whatever, it’s like 200%, it’s been a lot, like over 200, 300 percent in the last year.
[00:52:26] I’m not looking at a chart right now. This is to me exactly a moment where the technical analysis stuff can come in handy. And I was going to, uh, I was thinking about buying a put. Uh, today and it opened up like down 9 percent and I didn’t have a chance, but it’s on my, uh, to do list if the chart stuff, uh, I do gives me the signal.
[00:52:51] Luke: Yeah. I’d buy that. I buy that. It is in, well actually let’s do this clean show again. I’ve, I’ve popped it up on the finchat. io once more. [00:53:00] Um, this is not like, this is not like the Amazon picture at all. Um, this is. Yeah, so if we look back just in May this year, like the market cap of Palantir as April was about 45 billion.
[00:53:18] And today it’s 150 billion, like it’s tripled in less than a year. And it’s probably can’t see the magnitude of this on the picture I’ve got here because the scale is a bit wrong. But if you look at it as a like price to free cash flow today, it’s like 153 times free cash flow. And historically it’s been more like 50 to 60 times free cash flow.
[00:53:44] 50 to 60 times free cash flow is still expensive, but 150 times free cash flow is egregious. And this is a company that is optimized for free cash flow today. So, no argument with [00:54:00] you shorting Palantir, and actually I farved my own stock position just a few days ago. I said I was focusing on a real money portfolio.
[00:54:09] Maybe this is a bigger conversation we could usefully get into here, because, um, uh, because there’s a bunch of good quality and wildly bubbly companies, all of which are acting insane valuations right now by most normal valuation metrics. So to me, like the market is overheated, which is why I’m moving towards cash.
[00:54:31] Um, I think that, I think it’s going to be, you know, You know, a company like Palantir, even though Alex Karp is like selling stock like it’s going out of fashion, like the stock could still be, remain parabolic for some time to come. Um, but you got to be prudent, but I think there are, and that, that Palantir could be a good short candidate.
[00:54:54] I think there are also a bunch of other, like I talked to Al Carver, the Mediterranean restaurant chain [00:55:00] a couple of episodes ago and positioned the same kind of thing, like wildly overvalued, like 50 million market cap. per restaurant, that’s just insanity. Um, but even that stock could remain, uh, parabolic for some time to come.
[00:55:15] I think now is a good time to go and look for those, like, opportunities to take short positions though.
[00:55:20] Krzysztof: Um, here’s, so this is important, really important, um, the way I would shore Palantir is by buying puts. But one, to get away from the gambling side of it, make it a long dated put because the market will remain irrational longer than you’ll stay solvent.
[00:55:43] And two, for me, it’s useful in a situation like this to almost expect this trade to be a losing one. But in exactly the way that you. Expect your homeowner’s insurance. To [00:56:00] not pay out, you pay the insurance company, whatever it is for the year, and you hope your house doesn’t burn down. But if it does, you’re going to get paid.
[00:56:09] So the bet is, if the market corrects severely, Countier is going to get crushed, but you get paid for it. So it’s a little bit of a, call it a hedging instrument in my approach.
[00:56:24] Luke: Yeah, I think that’s a really good, uh, tool to use. Like, uh, I’m, I’m, I’m thinking about it in exactly the same way. I want to, I want to kind of ensure my investment portfolio.
[00:56:36] I’m doing that to some extent by going more heavily cash, but at the same time also, I think buying puts on overvalued stuff, possibly if you know, it’s a bit like. You’re betting on a diversified dog shit to underperform in the short term as a proxy for like, like selling the whole market. Why not try and sell the things that you think are [00:57:00] going to take the biggest hammering.
[00:57:02] So that might be an opportunity for the individual investor like ourselves, as opposed to, you know, the, the DCA buy and hold just sort of wait out the downturns, which is still the right thing to do if you’re kind of a hands off investor.
[00:57:17] Krzysztof: Right. And you should expect when momentum is in Palantir’s favor, you should expect to be wrong because you’re not going to time the top perfectly unless you get really, really, really lucky.
[00:57:30] But that’s just luck. Yeah. Like, people have been shorting this now since the, uh What is it, 40 a share, 50 a share, 55 a share, right? And it just keeps going up and up. Well, that’s, that, that’s the bitch of it, right? That’s why you always want to invest with momentum. And so when the chart shows me that there’s an actual reversal of that momentum, at a certain time frame, Then that’s my key to say, okay, mathematically, this is the better moment to go in.
[00:57:59] But then it could, of [00:58:00] course, reverse back. We don’t know. But yeah, thinking of it as insurance is a good, I think, a smart approach.
[00:58:07] Luke: I wonder if I can, um, I’m going to do another quick screen share, and I wonder if we can use this to step onto quickly the next topic, which was a question from a couple of weeks ago from one of our Patreons, Steven, and it related to my own 20 percent cash allocation, and he’s asking about my strategy, about how I manage that, and I thought I might just do a quick screen share and show you how I’ve managed my cash over the last couple of years, because I think this might be.
[00:58:34] Well, hopefully instructive. I’m going to say, uh, here’s a view of my cash allocation from Paul Sido. I’m really enjoying this tool. It’s really good. And if you can see the little numbers on there, so this is a view of my, so here we are back in, where’s that 2016. I was like 5 percent cash, 95 percent invested.
[00:58:54] Can you, can you see that on the little picture? Yep. Yep. Yep. Um, so, so historically [00:59:00] my cash has tended to fluctuate between about, Five and 10%. And then in 2019, it was like 0 percent I was pretty much fully invested. Um, and then, so I suppose the reason I’m pulled this up is I want to talk about the last time I felt like we’re at the peak of a cycle.
[00:59:18] So I had about 20 percent cash in early 2021. And then by November, 2021, the market felt like. Like it does now, it felt really overheated. And so I’d went for, I just jacked it up from like 6 percent cash almost overnight to I think 26 percent cash at one point there. And I think I got lucky, like my timing was bang on because that’s when the ass fell out of the market and growth stocks fell apart.
[00:59:49] And so being 26 percent cash actually really protected me. to some extent quite nicely from that. And then I continued and then I basically reinvested [01:00:00] that money and I got down to a low, I suppose, a low watermark of about, I think about 11, 12 percent cash by about a year ago, November, 2023. Um, because I was reinvesting that cash throughout the downturn.
[01:00:16] And then I’ve started to build it back up again. And so today I am back up to 20 percent cash right now. And my plan is to get that back up to 25 percent if markets don’t fall apart by probably the end of January. And if things are still, you know, even more parabolic than they are today, I might even take that up to 30%.
[01:00:39] So that’s how I’ve managed cash, Stephen, just by essentially doing that. Trying to over allocate to cash as a position when stuff is feels expensive. And, you know, my internal meter on that is, do I just feel comfortable? Am I sleeping well at night? [01:01:00] Um, and right now it was on my mind. That’s why I’ve started jacking up and I’m going to continue to be in that mode.
[01:01:06] And I might have egg on my face because come a couple of quarters time, like in video is reporting in this week, in a couple of days time, It’ll have reported by the time this episode goes out and I just sold half my Nvidia position again because I’ve got to take some cash from somewhere and I don’t like Palantir.
[01:01:23] That’s another one of those stocks that is just overvalued, I think.
[01:01:27] Krzysztof: And you know, there’s some gray area here, unfortunately, because, um, this is a little bit market timing ish. And you know, this is one of these things why, uh, investing is an art, uh, more than a science. You know, as we saw, if you haven’t listened to our conversation with Brad DeLong, do check it out, but I was bitching and moaning about how, when I had the same exact feeling basically a year ago, Uh, and I was sold out, I sold out the, the richly valued companies to buy, uh, undervalued [01:02:00] companies.
[01:02:00] And then I was dead wrong, uh, for the next year. That’s his response to me was, you know, you and a whole lot of other smart people were looking at the numbers and you made basically a rational decision, but the market is a complex system so you can’t ever be right all the time. So on and so forth. It’s okay, right?
[01:02:21] Tell me if this sounds right to you, Badger. It’s okay to have your principles, know what the rules are, meaning don’t market time. And then sometimes you break the rules when you have the years of experience and wisdom that you have this, you have this intuitive thing going on with the full acknowledgement that you might be wrong.
[01:02:43] Because the rule is the rule for a reason, but sometimes you break the rule for a reason. And it’s kind of a little bit of a hedging, hedging your bets in a way that’s intelligent. And I wish you all the luck, you know, I hope you’re timing it right. I’m in a very different [01:03:00] position because as you know, most of my companies I think are undervalued.
[01:03:03] So I’m fully invested because I don’t care what the market does, really. They’re not, you know, if they fall even further, that’d be, I’ll just buy more shares for cheaper.
[01:03:15] Luke: I, I, I entirely agree with that.
[01:03:18] Krzysztof: Wow. All right. So that, that was not a, that was a whole lot of talking we just did. Long episode,
[01:03:23] Luke: but before we close out today, let’s get back and do our old favorite, new segment, which is stock safari, which is where we just surface an idea each that’s on our radar.
[01:03:34] Might be something we’ve already bought or about to buy. Might be something we think is uninvestable today, but it’s an interesting idea to think about. It’s on the radar. And I think you’ve almost covered your stock safari stock already, but what is it for this week?
[01:03:47] Krzysztof: Yeah. So, uh, I’m, I’m cheating here because Chainlink is what I want everyone to look into.
[01:03:53] Uh, and it’s not just, I know this thing very, very deeply, but because of the crypto, [01:04:00] uh, movement, momentum that’s happening, that’s what I’m using as my stock Safari pick. Uh, on X, you can follow it by just doing, you know, a dollar symbol, L I N K link for link.
[01:04:14] Luke: Uh, my Safari stock is another private company, sorry, public market investors, but I’m looking at a company called Grok right now.
[01:04:22] And that’s not Grok, like the Twitter LLM, it’s G R O Q. And it’s a essentially like another chip design company to keep it really simple and super high level. Uh, they’re designing. Um, like you’ve got, say, GPU, like, so you’ve got like CPUs, regular processors in your computer and in your laptop. You’ve got GPUs, which are like accelerated computing, and that’s what NVIDIA is all about.
[01:04:49] And then Grok and a couple of other companies have a different approach to accelerated computing, which they’re calling like LPUs, Language Processing [01:05:00] Units. And essentially it’s still like accelerated computing. But a slightly different approach that they, uh, have demonstrated like massive, massive acceleration of large language model processing.
[01:05:14] And there’s some controversy around it. And there’s definitely some big questions about whether this is even needed, um, because maybe this is, this kind of approach will just get baked into CUDA and other, um, uh, Models that like companies like NVIDIA are working on, um, maybe, uh, Cerebrus, another hardware manufacturer, but Grok have got quite an interesting approach and they’ve got a real product, uh, which is being embedded into a number of fairly niche companies right now, but they are making revenue, a couple of million bucks a year, quite early company, and I’m hoping to get a small, uh, venture piece of that if I can in the upcoming investment round.
[01:05:54] So anyway, Grok is on my radar.
[01:05:57] Krzysztof: I think the obvious question to [01:06:00] any of our listeners is, can they too find their way to this company? How would they? Probably can’t, I’m afraid. At all? There’s no portal?
[01:06:11] Luke: Uh, nothing I would recommend. Like this stuff is, you’re taking your life in your hands and um, you make an investment.
[01:06:19] You’re investing in a special purpose vehicle. So like you typically, ideally you get your own lawyers involved to read the contracts and uh, like you’ve got this bespoke deal.
[01:06:29] Krzysztof: So how did you gain access?
[01:06:31] Luke: Uh, I’m now a member of a company that gives me access to some things like this. But only because I did the SpaceX thing a few weeks ago, I’m now looking at Grok.
[01:06:41] Like So is
[01:06:42] Krzysztof: there no way for, for any, anybody to follow the same path? There’s no like entry.
[01:06:49] Luke: It’s, but it’s possible. I don’t want to go on record publicly endorsing anything like this. I do not recommend it whatsoever. If you want to follow this route, there are ways, but you need to go and figure it out for yourself.
[01:06:59] I’m [01:07:00] not going to tell you how to do it because I could have set fire to my own money. I don’t even know if I really owned SpaceX shares. I kind of hope I do. But I won’t really know until like there’s an exit and then either I’ve got an allocation or I haven’t.
[01:07:15] Krzysztof: Can we make that a memeable quote? Like, I don’t even know if I own Let’s hope I own what I think I own. Yeah. Awesome. All right. So that’s, uh, that’s a wrap, right?
[01:07:30] Luke: Pretty much. I have a quick question for our Patreon members, uh, or potential Patreon members. So we are putting a logo of like fun behind the scenes content on there.
[01:07:42] Let us know on the Patreon what you want more of and what’s just like, I don’t like, stop sending me those drunk videos. Um, we haven’t stooped to like, dick pics. We’re not going there. But, uh, but there is some fun stuff on there as well as some serious stuff. So yeah, tell us what you want on the Patreon [01:08:00] and we’ll, Endeavour’s do more of that.
[01:08:01] If you guys ask really nicely and push him, I’m pushing him on WhatsApp. Like Christoph might start recording a couple of, uh, from the hip videos too. I know he’s a bit, a bit nervous nearly when it comes to that right now.
[01:08:13] Krzysztof: Yeah. I’m sensitive. I’m, uh, I’m, I’m not, uh, I don’t have a selfie stick, like, like you, you know,
[01:08:21] Luke: You need like a selfie stick with like a cardboard cutout of the badger giving you a thumbs up and you’ll be encouraged.
[01:08:27] Like talk to the cardboard cutout. Yeah.
[01:08:29] Krzysztof: Yeah. But we’re loving our new Patreon community. It’s starting to grow and it’s a lively place. So hop on in. Otherwise, leave us a comment on YouTube, where our channel is also in need of good conversation and questions, and we will answer the best questions that come forth our way, giving priority to our Patreon members.
[01:08:53] Luke: For real. Uh, we do like to chat on Twitter, slash X. I’m at seven Luke Allard.
[01:08:59] Krzysztof: [01:09:00] I’m at seven flying platypus.
[01:09:02] Luke: Are you ready to become a
[01:09:03] Krzysztof: beast of an investor? Your journey starts here.
[01:09:29] Disclaimer: The views in this program should not be taken as personalized advice. Before acting on any of the information provided, listeners are encouraged to consult a financial or tax professional.
