💣 Elon’s America Party Bombshell – After claiming he was done with politics to focus on being a “wartime CEO”, Elon announces plans to form the America Party to dismantle the current political system. With Trump and Musk back at each other’s throats, Tesla faces potential vindictive policies and loss of EV incentives. Is it time to reassess your $TSLA position, or should long-term investors hold steady?
🚀 SpaceX Caught in the Crossfire – The political fallout could benefit competitors like Rocket Lab and AST SpaceMobile while creating uncertainty for SpaceX’s government contracts and NASA relationships $RKLB $ASTS
💰 Robinhood’s Risky Tokenization Play – Why Robinhood’s plan to tokenize private equity (SpaceX, OpenAI) on blockchain could create massive arbitrage opportunities and potentially fleece retail investors $HOOD
📊 Big Bear AI: Not the Next Palantir – Luke exposes the garbage financial journalism pumping inferior AI stocks and explains why most investment “analysis” is just subscription-selling nonsense $BBAI $PLTR
💼 Big Beautiful Bill Breakdown – How recent legislation creates major tailwinds for EOS Energy and AST SpaceMobile through tax credit protections, domestic manufacturing incentives, and spectrum deregulation $EOSE $ASTS
🎯 King of the Jungle Trades – Krzysztof adds AMD to his AI basket based on attractive PEG ratios, while Luke bets on British institution Greggs despite their terrible coffee $AMD $GRG
🎢 Monkey’s Sicily Adventure – How a simple parking maneuver turned into a life-threatening 45-degree car tilt situation (spoiler: everyone survived)
Segments:
00:00 Cold Open – Kids Don’t Try This at Home
00:48 Elon’s America Party Announcement
07:33 Trump vs Musk: Financial Incentives vs Ego
15:17 Tesla Investment Thesis Under Pressure $TSLA
19:46 Big Beautiful Bill Impact on Holdings
26:58 Krys’s Near-Death Parking Experience
35:52 Big Bear AI Financial Journalism Breakdown $BBAI
46:58 Robinhood Tokenization Problems Explained
01:03:12 King of the Jungle: AMD and Greggs Purchases $AMD $GRG
 WSW – E88 – No Ads – America Party & Tokenisation of Private Equity
[00:00:00] Krys: kids do not try this at home.
[00:00:02] Luke: Elon announces he’s forming the America Party to dismantle the political system,
[00:00:07] Krys: he’s calling out the flawed system in the us, which is true. both parties are run by money.
[00:00:13] Luke: there’s hyper momentum around companies like SpaceX and OpenAI, The value of those tokenized stocks is gonna skyrocket,
[00:00:21] Krys: Anytime Donald Trump accuses you of going off the rails, you’ve really done something.
[00:00:26] Luke: Over the last year, big Bear AI has gone on an incredible, nearly 300% rally to beat the s and p.
[00:00:33] Krys: you cannot look at price and determine anything useful, which scares people out.
[00:00:39] Luke: Trump can be vindictive, but he’ll shake a hand with someone he dislikes if it makes him a dollar.
[00:00:48] Luke: Welcome to Wall Street Wildlife. In this week’s episode, after saying he was leaving politics to focus on being a wartime CEO for his companies, Elon announces he’s forming the America Party to dismantle the current political system, arguing it’s led to fiscal ruin and ignores the will of the populace.
What does that mean for Americans and what does that mean for SpaceX and Tesla shareholders who are gonna unpack it today? Also. Robinhood proposes putting stocks and private equity on the blockchain. What does that mean for investors in companies like SpaceX and OpenAI and potential investors in these companies in the future?
Plus, why Big Bear AI is not the next Palantir and why most financial journalism is absolute garbage. Plus, Christophe and I are putting two of our previous Safari stocks into action. Hang around to the end of the episode to hear which overlooked semiconductor play Christophe has bought, and however I’ve added to my dividend portfolio.
[00:01:53] Krys: And I have a couple of thoughts on the big beautiful bill and how it, it affects two of our larger King of the Jungle positions. Uh, so, so Badger, uh, this last week I was mostly on, uh, planes, trains, boats, and automobiles. Make my way back, Sicily, back to Sicily. Did I miss anything?
[00:02:14] Luke: Well, your comment about the big beautiful Bill, right, Elon, is up, is proposing to upend your political system in the States, and he’s planning to launch the America Party and like Musk and Trump are back at each other’s throats again, I think Trump has truth in the last 24 hours. I’m saddened to see Elon Musk go completely off the rails becoming a train wreck.
It’s hard to sort of piece through like the egos and the, the nonsense and, you know, is Musk really doing this? Okay. I mean, let’s, let’s say up, right? Clearly, Musk does not intend to try to become president of the United States. Like his political ambitions do not extend that
[00:02:56] Krys: Well, they can’t, legally, not that, I mean, uh, he’s born in South Africa. That’s one thing, but these days, who knows? But go ahead.
[00:03:03] Luke: Yeah, yeah, yeah, that’s true. That’s true. That’s true. You could probably buy a change in the law, but I don’t think that’s his goal, right? It doesn’t serve his greater purpose, but he does have enough cash that he could maybe like buy a couple of really key swing states and then become, when I say buy, you know, like spend a crap ton of money on marketing and like getting boots on the ground and like talking to people and you know, trying to really be, like the face of maybe like these states, like Ohio, places like that.
Is Ohio still a swing state?
[00:03:37] Krys: Uh,
[00:03:38] Luke: track?
[00:03:39] Krys: yeah, it’s.
[00:03:41] Luke: Yeah. Anyway, I, yeah, I don’t know. by state job, like American detail, but you know, there are places where he could spend much more money outspend the Democrats and the Republicans put together, and I. Like, like he, he would be able to buy political influence in that way.
And if he can install like his own, uh, party, the America Party in certain locations, he could be, he could become much more directly influential in key issues. And so like the, the background again, like Trump is kind of positioning this as, this is Elon pushing back because I’ve, you know, done, I’m enacting the will of the American people.
I’m pulling these EV rebates and like, you know, drill, baby drill, you know, we want to be able to like, use our natural resources. Elon has previously said I didn’t need those rebates. Like my companies are successful without them, I think as an investor. Well, let me give you a bit of our time. I’ve got some thoughts on how important those, like how much the rebates are to Tesla.
But what would you make of all this sort of messy situation and the, the boiling
[00:04:47] Krys: Yeah. So, right. Good pause there. One. Anytime Donald Trump accuses you of going completely off the rails, you’ve really done something. Two. I’m taking this seriously. And you know why you mentioned it briefly, not, not that this is, I mean, I’m taking it more than another drama unfolding, like more than another soap opera.
And it is because these two guys in particular, we know they are so ego forward, so to speak, that unlike Trump as a politician, he actually does what he says, which is still weird. You know, it’s kind of this crazy counterintuitive logic. But I believe that, so when he says he’s going to be vindictive against you and he’s gonna throw everything he can against you, I don’t think that’s just talk.
He’s fully capable of doing it. That is why I think today’s shares of Tesla are down big again, and it’s why, uh, I’m very uncomfortable being a Tesla owner in this kind of dynamic, just. ’cause who knows, right? Who, who he might go beyond revoking the EV mandates into actual vindictive policies. And we now know also that much of his base could be swung.
You know, they were pro Tesla and now they could be against Tesla and the Libs are gone. So what’s Tesla left with? It’s like a bad, precarious situation. That’s half of it. The other half we know is that Elon is also a weirdo in the sense that he’s continual, he’s capable of continuously betting it all on things that he really believes in because he’s already, he thinks the most entertaining outcome is the most likely one.
He’s already playing his own version. You know, life is like a video game of sorts to him. And so, uh, most other people might, you know, yap hard and say, yeah, I’m gonna try to disrupt the US politics and then, you know, get a headline or two out of it. Must might really do this legitimately. And, and I don’t know, to those of you not fully nuanced with US politics right now.
The, the margins are so thin between a couple of seats here, a couple of votes there with, like you said, the massive amounts of money that Elon has at his disposal to turn, call it, turn a politician or two, or three or four that could legitimately swing. Huge policies. This is a big effing deal, I think. Um, and how this is gonna unfold is like, yeah, that’s gonna be the soap opera, but, uh, hold onto, hold onto your hats.
[00:07:33] Luke: Like in some ways the, the counterbalance here is if it’s in the financial interests of both of these individuals, like they will do what’s in their own financial interest. and Trump will do that too. Like he could, maybe, he can be vindictive, but at the same time, like he’ll shake a hand with someone he dislikes personally if it makes him a dollar.
and I’m certain despite what he says, like he respects Musk, if only that he respects his wealth and his influence and like the things he’s achieved. So, yeah, he might go after him, but there’ll be like an ulterior motive, which is financial, right? Maybe for Trump and his family personally, or maybe ostensibly for the American
[00:08:14] Krys: Yes, of course. I do think there’s a slight difference there between these two characters. Trump I do think keeps score with money. Call it prestige. I don’t think Musk cares about either of those things necessarily. He cares about, he keeps score in terms of the success of his businesses. Now, here’s an interesting tell.
You also alluded to it briefly,
Marker
[00:08:35] Krys: This is, uh, Elon responded to this graphic showing the, that basically going straight up to the right by saying the American Party is needed to fight the Republican slash Democrat uni party.
Now, what’s telling to me about this is he, he’s calling out the flawed system in the us, which I think is true. It’s both parties are run by money. So as as money rules, democracies, democracies are bought out and then you see this debt crisis we’re in because no lobbyist is willing to. Sort of, you know, back off what, what’s theirs in quotes, but Elon Musk, by calling both parties the uni party, he knew this already and yet he still, during the campaign, during the elections, still decided to back Trump because he thought in the sense Trump could be the better uniparty for him.
So this is why I think you’re right there is, it’s the same with the Epstein foul things, right? You like the, the counter logic there is Elon knew that Trump. Allegedly is on the list, but he was willing to not say anything as long as Trump got elected. As soon as then they had their breakup, he said, oh, but you are on the Epstein list.
But you already knew that beforehand. Right. Same logic here. So it’s clear to me, uh, I don’t know if our listeners were remembered this spiral dynamics thing. I talked about levels of character development. This is pr precisely orange level behavior on Musk’s part where he’s deliberately kind of taking advantage of what could be taken advantage of for the benefit of his business without a deeper ethical, or call it greater cultural vision.
It’s like about his businesses. Whereas Trump is below that in the sense of power dynamics, power struggles, but it kind of looks similar.
[00:10:39] Luke: So what’s your, let’s bring it round to our investment portfolios and also, you know, your feelings as an American like, so you are pessimistic on Tesla now.
[00:10:49] Krys: Yes. I don’t see what would make the stock go up, call it in the next, let’s say, let’s put our short term hats on. we pretty much can be guaranteed that the delivery numbers will be year over year diminished because of all the political fallout. Now you have the president of the United States as an antagonist, whereas before he was a proponent.
So I don’t see how that raises your, the amount of cars you sell, and then all the stuff for which we invest in Robo Taxii and, uh, the robots. We know Tesla had this sort of soft launch, but, but kind of like quantum computing. It’s, it’s a headline, yet it’s not really doing anything yet. I mean, it’s developing the technology, but it’s not bringing in any revenue.
So I don’t really see much that Tesla could do in the next six months, call it on the fundamental side, that wouldn’t be at best neutral or at worst, quite worse than even pessimistic numbers. Am I missing
something?
[00:11:55] Luke: No, no, no. I think you’re right. It’s a tricky one. I was chatting to my brother at the weekend and I list, like we were out running and I listed Tesla as one of my highest conviction plays right now, but that was prior to the America Party news. It’s literally like hot off the press. Yeah. You know, maybe that rocks my confidence a little bit, but I’ll kind of stand what I, by what I said over the last couple of episodes.
Like the success of Tesla stock, right? Tesla as an investment to me, still rides on Robax and Optimus. Um, even if the sales of the cars to like end users, like drivers is going sideways for a couple of quarters, maybe a little longer, now could Trump put his fingers on the scale and slow down Robo Taxii rollout?
Like probably he could ask the National Highways Agency to take a much tougher look, maybe pull Tesla’s ability to continue to roll out Robotaxis, but that would be serious. I know and it’s not so it’s not, so it’s not like Uber, right? Like if you try to say you tried to pull Uber from the States now, right.
There would be legitimate upflow. ’cause so many people have gotten used to that as the new status quo. But not, there’s not enough momentum for like Waymo and Robo Taxii and things like that across enough of the US that it would create like a piti political, like difficult decision if they decided to really slow down like the rollout of these things.
And you could make a differently, make an argument that it’s like protecting American jobs might go against the whole narrative around like letting China get ahead. But you know, there’s certainly things that the administration could do to make life very difficult for the company.
[00:13:34] Krys: and to repeat myself, this is the thing, most humans would not be that petty to single out a particular antagonist. Trump is absolutely capable of being that one guy that could and would. And so because we’re long-term investors and that’s what we teach, I think you not doing much of anything now and just using all your energy to sit on your hands on your Tesla shares is perfectly reasonable for all the reasons we’ve always talked about.
That the moment you sell, there’s some unexpected headline and or whatever. But putting on my short term traders hat on, and here def define I’m defining short term now, extending it to sort of medium term, three to six months. I feel the probabilities are much better. I. That where I, to sell all my Tesla shares, I’ll be able to buy them back cheaper six months to a year from now.
And all that entails either paying taxes or if you’re in a taxed Advantage account, you know, then you don’t have to deal with that. it feels like something I might possibly try on my own. and actually regarding the King of the Jungle, this is a, this is, this is a good sidebar. I was looking at my, uh, companies and King of the Jungle and of course I have my 0.13, three shares of Tesla there, right?
And for our audience that, that just represents that I have conviction in Tesla. And this morning I was legitimately thinking of selling it. and what held me back from doing it is exactly the reason I think you are thinking of not selling it. It’s that long-termism. It’s not worth the jumping in and out.
Just let it ride.
[00:15:17] Luke: but I do have Tesla as a high conviction stock right now, and I think I’m reassessing that. I think if I were having the same conversation with my brother today, it would be like a hold and wait and see, hold you onto your pants. Um, so yeah, I’m probably also somewhat more pessimistic only because going back to what we said in the intro, right, Musk.
There was all this nonsense with Doge and then the initial falling out with Trump and then it looked like they kind of repaired things between ’em a little bit because it was in their interests financially to do that. So they did. And Musk said like, I’m, I’m finished with Doge now, you know, my time here is done.
I’m going back to be like a wartime CEO for my companies. So that was like if he was coming back to, you know, pitches tent on the shop floor and make sure like robo taxis are rolling off the line at the right pace and SpaceX, like Starships are actually getting into a bit, rather than blowing up on the pad, then great.
I’m a fan of that. If he’s going back so directly, if he does go ahead with his, with his sort of threats, I suppose, and launch the America Party like tough conversation in the boardroom of these
[00:16:30] Krys: You know, there’s this adage in life, You, you get into fights with people, you get into disagreements, you know it’s par, par for course, you know, making your way through one day to the next. But when you attack another man’s livelihood, all of a sudden somehow it’s okay. This isn’t like a, you know, this isn’t a joke anymore.
It’s like you, you are really going after something more primal. And obviously if Musk goes through with this, he’s attacking Trump in the most direct way he could possibly do. And so the other potential beneficiary slash consequence of all this will be SpaceX slash are now mutual holding in a STS. And there’s a reason I think, more, uh, I wanna say more about this with the big beautiful bill thing, but, uh, my understanding is one of the main reasons for the TIFF is that, Musk nominated his guy to head nassa. but then Trump found out he’s a big Dem Democratic donor, so he said, no way. And Trump could very well attack SpaceX and Tesla and all of Musk’s properties. So to the benefit of A STS, but to the detriment of SpaceX.
[00:17:42] Luke: Well, and, and more to the benefit property of Rocket Lab who are like more directly in competition in some ways, although in some ways also partners with SpaceX for like medium launch, like Rocket Lab stock is through the moon. Forgive the term, like it’s all time highs right now. Um, and now I’m sweating my own stock position a little bit ’cause it’s like nearly my biggest stock
position. And that’s, that’s like a, for me, that’s a chunk of change. So, I’m not selling or, or trimming just yet, but it’s definitely, I’ve got an eye on it if it continues to run. And it’s mostly continuing to run because, well. Peter Beck, incredible CEO. They’ve had like a hundred percent successful track record of electron launches like the small launch this year.
And at the fastest pace ever they say they’re on track for Neutron, which is their medium launch vehicle. Maybe do some tests in the second half of this year. We haven’t seen direct progress of that, but like the stock sort of indicates that people believe that’s gonna happen. Um, but also because SpaceX have had this falling out essentially, or Musk has had the falling out of the administration.
And so anyone who’s like dependent on the services of one of Musk’s companies is probably thinking, well, we need to diversify our supplier base here.
[00:18:59] Krys: Yeah, it’s a good problem to have and I think right now selling into obvious tailwinds is, is not the right thing unless, like you said, it’s grown to such a huge. Proportion of your portfolio. So this is the hard moment, right? Where you have lots of reasons to sell, but tailwinds make it. Why would you, so why would you, um, I always say in these situations, you should have a better place for your money.
You know, something like, pretty obvious to reallocate into.
[00:19:32] Luke: Tesla puts obviously.
[00:19:35] Krys: Hey, uh, I think I, I wanna jump our, our queue a little bit and maybe talk about the, the big beautiful bill because it ties into these companies. You, you wanna do that?
[00:19:46] Luke: I do like hang around in this episode because Christophe has a story he’s gonna share, but we’ve put our stories to like mid episode. So, but tune in to hear how he nearly died today, I think. Tell us about the big
[00:19:58] Krys: Yeah. Okay. So real, real brief. Over the weekend, you know, Trump signs this bill and then we have the long weekend. And, uh, in the, in the research I was able to do, uh, I saw a bunch of really very takes on how absolutely awful this bill is because of all the poor people that are gonna lose necessary infrastructure versus, you know, people absolutely beaming and delighting and all the things that this bill is going to accomplish.
And I, in this moment, really have no idea what to believe as usual, because I, I’m, I didn’t read the 9,000 pages of the thing, but I do. But when I did look into, uh, my top holdings, both EOS and A STS, I was very happy to see the, the probable outcome. And that is essentially that while some. Call it renewable energy projects have more pressure on them to get going and get going faster because there’s gonna be, uh, lessening of the credits down the road.
A company like eos, who through this bill has, has its investment tax credits protected, uh, until it starts getting phased out in 2032 to 2036. It also, so that’s good for it. Basically, this bill also supported domestic manufacturing. So all the companies that make batteries outside the us, it’s some percentage will be penalized, therefore good for domestic producer like eos.
And lastly, uh, the bill maintained TRA tax transfer transferability credits. What that means very briefly is that if you make a. Revenue in the renewable and or in the energy sector, you get tax credits, but EOS isn’t gonna be selling enough, so it doesn’t have enough tax, tax penalties to offset the credits.
But this tax transferability allows them to sell credits to another company that can cash them in. So it’s as though they themselves could benefit from it. So it’s quite a tailwind. Uh, and you know, my big investment thesis is that all companies investing in infrastructure, energy, infrastructure in the age of AI will benefit wildly for the next many, many, many years.
And as an EO shareholder, the passage of this bill is, I think net, net quite positive. So, um, you know, I’m not judging the bill as a whole, but in this particular way I think it, it’s two thumbs up. Likewise. Um, there’s a lot of specific points with regard to how this bill affects the space industry and net net it allocates much more revenue to the space industry, including for things like space related defense projects, government defense for, which is, that’s basically the core investment thesis.
If you peel back the curtain on a STS, and there was this, um, release from the, um, from Chairman Carr, Which is basically the resource on which telecommunication companies run, and it’s a rare resource.
All this stuff will now be regulated by the FCC again. So basically more of it will become available, which is another huge tailwind for all, uh, technological enterprises that, that depend on, uh, spectrum as its main kind of highway tool. So basically before this bill, there was a regulatory block. This bill releases that block.
I don’t really know why the block was there in the first place, unfortunately. Um, I’ll look into that down the road. But basically it’s another one of these let’s deregulate open up more spectrum. And in this moment in time with rockets going up in the air and the need for global spectrum to be everywhere, cover rural broadband and all of that, this is a massive tailwind for a company like a STS.
So another. Kind of thumbs up for whatever the big beautiful bill accomplishes.
[00:24:22] Luke: All right, very good. I need to take a proper look at a STS ’cause it’s now grown, I think I said last week, to like nearly a 2% allocation. Um, I like to do that in my portfolio. Like sometimes I’ll buy stuff like less than 1%, just a bunch of things. See, let the market show me which ones the winners are in the short term, and then do the work, like the real work afterwards.
So I’m getting to the point that I should be doing the real work. So if you’re telling me the big, beautiful bell is gonna be big and beautiful for my A STS position, that’s, uh, that’s good to know.
[00:24:52] Krys: Yes, and in as much as I found a couple spare hours during my travels this past week, I. I spent them mostly digging very deeply into A STS, including fundamental technologies. So our listeners, you can, you can start expecting a longer ish thing coming from your Wall Street Wildlife hosts on A STS fundamentals and basics.
[00:25:16] Luke: That’s good. I’ve, uh, we were doing some like podcast analytics a little while ago trying to understand, we’re doing reasonably well on the podcast. We’ve got our Patreon, which is fantastic and we we’re doing really well there, but our YouTube channel is just languishing and I’m like doing experiments and haranguing Christophe as to how we can get the YouTube off the ground.
Um, and it looks like the episodes where we did like deep dives into companies are the kind of things you guys wanna see. ’cause there’s like. Pretty pictures and decks and charts and all sorts of actual financial analysis. So yeah, I think Christoph is committing to doing one of those for a STS.
[00:25:52] Krys: Yeah, this is like, uh, I’m pretty confident about this. This is maybe pulling back the curtain too, too much. But, uh, you know, there’s some people that have been investing in a STS for four years now where it was totally just more like a science project on hopium. And it barely survived, you know, the financial valley of death, but now is exactly the right time.
Like right before, call it months before things really get going for most investors to really educate themselves because this is gonna be potentially a generational company, sort of like that, Amazon’s, Googles or whatever that really do things re rework how the world basically runs. Um, it has that kind of capacity.
I think whether it happens or not is, is unknown, but, but I’m excited to do this deep dive in the coming few weeks.
[00:26:48] Luke: We all looking forward to it. So hopefully you will survive until then to do the deep dive, but I gather you had a brush with death today. What happened?
[00:26:58] Krys: Well, it sort of felt like it, you know, there, there’s that story where, When you’re on a journey, we’re doing some, some long-term project, like the first 80% is a breeze, but the last 20% is like where it gets really tough. And with FSD, it’s like the first 99% is fine, but the last, that last low, those edge cases are, well, turns out I drove just fine all the way from Warsaw.
We drove, uh, for whatever, eight hours down to Vienna, right? Navigated, got my, got my uh, legs under me, driving in the European highways, weaving in and now crazy, two lane traffic, whatever. Fine. Then we make it to Verona. That went well. Then we make it to Geno Genoa, which is kind of, that’s where you get the crazy Italian driving with the scooters moving in.
I mean, I don’t know you, if you drove in Asia like. Madness. More, more madness, right? Tight lanes. Anyway, that all went fine. We went on a big, uh, what’s it called? The big ship that took us from Genoa to Sicily. Uh, survived that and getting out from that. Make it to our, our house in Sicily and last, literal, last 50 feet, we have to go up a, a massively steep hill.
I mean, like real plane, right? Think San Francisco. On both sides there are cars parked. So you have millimeters to each side for which to squeeze the little car. And then at the top there’s this, it’s very hard to describe, but think of it almost like a square that’s regular and it’s not paved evenly. So you have like bumps and gradations and steps.
On both sides. On all sides. And we got this low garage right to at the end of this low platform. So we want to basically, we decide it’s gonna be a good idea to see if we could back into this garage. Well, when you have no room to maneuver, you’re on such a steep angle and there’s irregular, uh, drops all around you.
Uh, my beloved wife got out of the car to kind of help, uh, whatever navigate or, you know, like on an air, you know, what’s it called? The Air Airlines?
[00:29:28] Luke: Yeah.
[00:29:28] Krys: yeah,
yeah,
[00:29:28] Luke: Like reverse
[00:29:29] Krys: yeah. yeah. So she’s kind of, ’cause I can’t see the regularities in the car. It’s such a small spot, but they’re all around me. So I’m trying to, you know, edge the car back into the garage, you know, doing, you know. 90 degree turns each way fighting for each millimeter. And then at one moment she says, okay, go forward, be before me. Is is the next, uh, house, brick wall. So I go forward and then all of a sudden what she didn’t see is that, is that there’s a mat, there’s, it wasn’t just, uh, there was a basically massive gap between where the car was parked and the wall, which I couldn’t, so I couldn’t see. It was probably about a foot, two feet wide, uh,
[00:30:19] Luke: Oh, a trench, like some sort of rain trench or something.
[00:30:21] Krys: probably like a trench. So when I went forward, the car actually fell into the trench so that the car was now at 45 degree angle with.
[00:30:32] Luke: Ah,
[00:30:35] Krys: One wheel in the trench, the other wheel barely on the platform. The back wheel. In the air. In the air. And if you, so I, I thought the car was broke.
[00:30:49] Luke: you’ve seen the movie, the Italian Top right? I only told you to blow the bloody doors off.
[00:30:54] Krys: I’m laughing now. But in that moment, when I got out of the car one, I was lucky I didn’t crash into the wall because when the car falls in an unexpected trench, right? I thought we might’ve like actually wrecked the car. But then when I looked at the wheel, it’s so far down in the trench, I was like in the other back wheel up in the air.
How’s it ever gonna get back out? Like it’s kind of, I thought, okay, one, it looks like the car can, won’t be able to get out, but two, how are we ever gonna get it out? ’cause a tow truck can’t come up that little. Like, are we gonna need to get helicopters involved or like, it was bad. It was bad. So we were out there for a good while and a good Samaritan walked up the hill.
Uh, and we kind of started working on this problem together, and bit by a bit, we MacGyver the fuck out of this by first placing little tiles under the, the wheel that was falling in the trench. Then somebody got in the backseat to kind of like jump on it to raise the wheel a little bit, and then we got a piece of wood under there.
Then we noticed that there was this stone lying in the corner. And by placing the stone next to the trench, the wheel had a little bit more traction to kind of get back up and then reversed it, like pray, you know, set a few novenas
[00:32:14] Luke: All.
[00:32:14] Krys: and kind of got the car out, uh, of the thing with only minimal damage.
[00:32:21] Luke: And that the rental company’s never gonna look underneath the car like the under the cha, like the undercarriage. So you just hope they don’t listen to this podcast and you’re set.
[00:32:30] Krys: Right. Uh, kids do not try this at home. Uh, it was, it was a little, it was a little terrifying to, to be honest with you. Um,
[00:32:41] Luke: Very good. I will say to our listeners, like, if you’re renting, what did you got? Some little fear or something. If you’re renting that in Sicily, like check out the underneath before you take it away from the rental company in case it was Christoph’s.
[00:32:52] Krys: yeah. Yeah. I mean, there’s no way, there’s no way to survive in this environment without your car. It’s, it’s amazing. It’s amazing. Any cars have even, like, they all have four wheels and two mirrors. Uh, but anyway, live and learn, you know, live and learn. And I, I, this is extending it. I know I’m, I’m now trying to milk the cow for all that it’s worth.
But in that situation where the, the literal ground underneath the car’s wheels was so irregular and so bizarre, and no room to maneuver. Going slow and not necessarily trusting somebody telling you, oh sure, go ahead. Like what’s in front of you is fine. Like just double checking. Every millimeter would probably have saved me a bunch of gray hairs in this case, but, uh,
[00:33:45] Luke: You got a good story outta it.
[00:33:46] Krys: but you know, we’re fine.
[00:33:49] Luke: Good. Excellent. When you mentioned, uh, your wife, I thought it was gonna be something very serious, but no, you’ve just like dented your pride and dented the, uh, rented vehicle. No big deal.
[00:33:59] Krys: yeah. And, and there’s a little bit of adrenaline still, you know, it’s not like, you know, after a long journey and all of a sudden 50, 50 feet from, from goal, your car is tilted at a 45 degree angle. It like gets your blood, it gets, uh, gets the part pumping. But yeah, no, we’re fine.
[00:34:21] Luke: All right. Nice to hear. Good to hear. Well, don’t kill yourself because obviously the podcast will come to a bitter end of just me. I got my monkey right here. I’ve actually got my monkey mug with me because I was also having a conversation with my brother over the weekend. We went to Wimbledon. We had like a fantastic time.
Went to Smoke and Fire Festival, like a barbecue festival on Saturday. Great laugh. And uh, we were chatting about the podcast and I was telling about my YouTube woos. He’s like, you’re quite tough on Christoph, aren’t you? He’s like, I really like, he listened to him. He’s like, I really like the dynamic. And you know, you are the like long term guy, and Christoph has like a different strategy.
He’s like, he’s christophe’s really like kind to you and your strategy and accepting that it’s different but you, that you give him no quarter, so, so
[00:35:08] Krys: I know why. I know. We, as our Patreons pointed out, it’s because you’re an Oasis fan. You’ve, you’ve, you’ve hung around too, too long for too many what decades around, what’s his face, Liam and Noel. And, uh, you’ve taken the page out of their playbook. That’s okay to be mean to grandma
unless you wanna now fill up massive stadiums.
Correct. And this is your insight that then you play nice to get everybody, uh, in, on the love fest, the new, the, the next stage. So maybe I suggest, maybe that’s what we need to do. You start being nicer to me and then everybody will see that the War of the Roses is, is done and we sell, go and sell out the stadiums.
[00:35:52] Luke: I dunno what sell. I’m willing to experiment with your AB test. My, uh, we called like the next segment twice and one of I really fricking angry and I’ll be really nice and then we’ll see which one does
[00:36:02] Krys: Hey, maybe, maybe, uh, anyone listening to this, if you could respond with a comment on our Patreon or YouTube, whether a you want Badger to continue being mean Old Badger, or whether you want him to be a little more sensitive to monkey’s feelings, uh, then let your will be known and we’ll see what we could do.
We’ll see what Badger can do.
[00:36:26] Luke: Well, you know, if there’s one thing I have in common with Musk and Trump, it is, you know, I. I respect the money and the capitalist attitude. Like if your stocks come good, like your A STS stock has, TS stock has doubled for me. If you can deliver a few more of those, like you have my respect regardless. So yeah, show me the money Christophe.
[00:36:45] Krys: Okay, well, I was, I was trying so hard, but talking about iron, iris energy, uh, for many months, which has been a massive, almost double now. Uh, but you did not partake. So you need a mirror, uh, to look into and ask yourself, why didn’t you listen to monkey there? Quick, quick note, because it’s just so fascinating.
Today I ran after a massive 300 something percent runup. The last few weeks, uh, open up down 10% or near 10%, and at this moment it’s up 6%. So this is another one of these weird things where anybody that’s just watching prices like these massive swings to the tune of like 16%, which is like hundreds of millions or in this in massive, massive market cap swings in just over an hour is kind of like mind-boggling to me how this is, uh, the new terrain.
But, but so it is, so, um, you cannot be, you cannot look at price and determine anything useful, which usually scares people out.
[00:37:51] Luke: Right. That, that’s actually a really nice segue to something I wanted to talk about today. So let’s, let’s tackle our next topic, which was, uh, the headline was Big Bear. AI is not the next Palantir. But really what I wanna talk about here is like, most finance journalism is total garbage and ba basically just what you just said. market Beat, I dunno who they are, like some finance aggregator. It’s probably written by AI even. It’s got a human’s name on there. He’s got kind of AI teeth. Um, so this came to my attention ’cause one of my good buddies in our investing WhatsApp, like a close personal friend said, Hey Luke, like you are a Palantir shareholder.
Check out this article. What do you think of these guys? Big Bear ai? Um, so I read the article and like, it’s clearly just thin vacuous bs, but let’s just quickly skim it. ’cause I wanna, I wanna sort of draw attention to why you have to have like your radar on when you read stuff like this. These like, almost like pump and dump style articles when they’re not trying to pump the stock to make money.
They’re just trying to sell subscriptions to their website and, you know, sell. Well, like adverts. ’cause look, this page is full of adverts, um, like their thesis for Big Bear ai. And I’m sure if I went and looked at any stock on their website, I’m gonna see the same nonsense. But here’s just one example. Um, with fundamentals, momentum, and financials to back it, big Bear AI could become the next Palantir story.
So what’s the, like, the basis of their thesis? Well, first popularity, not only has Palantir achieved top ranks in the market through financial growth and success, but also it’s marketing efforts. And everyone knows the CEO is an eccentric figure. Well, so they don’t, they don’t justify this. Yes. Palantir no argument is a big name.
There’s a lot of hyper momentum. They do real things. If you go look at the, the actual financials of Palantir, there’s good reasons why Alex Karp is like crowing and he’s like the king of the, uh, the king of the mountain right now. But so unsubstantiated claim. That Big Bear AI is like Palantir for no explained reason, but Palantir, uh, are popular.
So somehow that makes ’em the same. Okay. Whatever. Um, big. Okay. Over, let’s look at some actual numbers then. So what does this article tell us? Over the last year, big Bear AI has gone on an incredible, nearly 300% rally to beat the s and p. Um, however, the stock still trades only a fraction of its all time high, um, of just under $10 per share.
So, I mean, what that’s meaningless, right? Basically the stock has just been volatile as hell ’cause it’s kind of a small cap, maybe a micro cap. The, the stock price has been all over the shop and it’s currently. Like valued lower than it once was. Somewhere below its all time high. That tells you absolutely nothing.
There’s a reason why the stock was cheaper and that the fact that it’s below its all time high, tells you nothing about its potential. You gotta look at the actual fundamentals. Google Trends, a Google Trends search will tell you how popular this stock has become. This is like circular logic. Okay. You know, websites like this, uh, pump a stock, like Wall Street bets pump a stock and it becomes popular as a stock, not as an underlying investment.
If Big Bear AI is anything like Palantir, it’s not like guys in the street and the popularity with investors that drives those companies to greater and greater heights. It’s actually their popularity with their customers. Are they selling more and more stuff? Like if we go and look at some actual.
Financials for Big Bear ai, it’s nothing like Palantir. Revenue growth is, has been 2% in the last year. Like Palantir is 30 something percent year over year. Um, and it’s just, it’s just been languishing. And the company’s also spending a ton of revenue on sales and marketing. If you look at the breakdown of how much, like basically the percentage of your total revenue, that’s like money in the door before you spend anything else, money in the door.
And relative to how much you spend on sales and r and d, those are quite interesting things to look at for actual technology. AI companies, big Bear AI is spending 7% of its revenue on r and d. That’s like Lamentably low. It’s, it’s a small cap stock. And if it’s not spending enough on r and d, like what’s its competitive advantage and how’s it gonna grow that?
And it’s spending. Nearly 45% of revenue on sales and marketing. Like if you really had a strong product, you wouldn’t need to spend so much on sales and marketing ’cause the product would sell itself. And then if you look at their 10 K, like they’re projecting flat revenue for this year. So like, I don’t wanna go any more on this ’cause it’s just kind of a waste of air time.
But I do wanna point out that when you look up websites and articles and nonsense like this, it’s easy to get caught up in the hype, but you have to do your own due diligence and you have to really dig into the numbers. And yeah, lo and behold, let’s go down to the bottom of the page. What’s the, what’s the website actually selling?
Well before you consider Big Bear ai, ’cause obviously they’re not really pumping it, they’re just trying to jump on this Google trend to get people looking at their website or they’re actually selling their own service. So anyway, that’s enough of that, but there is a ton of garbage out there. Use your turn on your, your brain and your kind of skeptical instincts whenever you read things like this.
I used to be a fan of the Motley Fool, but most of the stuff you see on the free side of the Motley Fool these days, I’m afraid, is very similar to that. Um, yeah, like do your, do the homework, do the real work, and do your own financial analysis and come to podcasts like this. Like we do our best to give you the real inside track.
We do have a Patreon, but like, we’re not selling anything really. If you wanna give us your Patreon age, we very much appreciate it and it enables us to deliver a better quality show and spend more time on this stuff. But like we’re doing the work for the pure pleasure of it, and because it makes us.
Better investors and we are both super transparent with our investments. I publish my entire real money portfolio on X every month, and both of us have our King of the Jungle portfolios where we show you our real stock picks, and we’re having our King of the Jungle challenge where we’re trying to beat each other essentially in a real money, small, you know, a couple of hundred bucks a month, but it’s real money over the last two years.
It’s turning into something quite material now, and we’re showing you really how to become a long-term investor.
[00:44:52] Krys: You know, as I was listening to what you just said, Luke, uh, I got a bad feeling because, uh, these kinds of call it scams, borderer line scams where you’re being sold. One thing that’s not quite it, one, we know that people are still getting scammed in the old way, you know, actual like. You know, labs set up to scam people and people still fall for that kind of stuff.
Now, I’ve noticed an uptick on the more sophisticated kinds of scams Coming to my phone and email, you’ve dealt with a bunch of these, right? Where it looks like it’s from an actual company and here’s the link. And in, in a moment of inattention, I would call, all it takes probably is for you to click that link inadvertently because it, you just weren’t really focused on what you were doing.
And then who knows what kind of malware can invade your computer? All that, these kinds of fake. Analysis pieces are only going to get more sophisticated and more real looking. I bet you sadly, lots of people are gonna be taken by them. So here’s my best antidote. If it sounds like it’s too good to be true, it is too good to be true.
And if it is really that good, then you have time with which to one, investigate it, and then do your research over one week, two weeks, three weeks, jump on the community, say, Hey, has anyone heard of this? Get more eyeballs on it. Do let the community thing do what it does. And only then, right? Nobody’s saying this is complete crackpot, you know, then you might be able to go forward.
But there’s just never any rush with these kinds of things. And, uh, I hope nobody really loses more than a pair of knickers on, on these kinds of scams. But, um, I, I, I, something tells me they will.
[00:46:46] Luke: Alright, we wanna talk about next. We both made some purchases in our King of the jungle, but also we were gonna chat about, uh, Robin Hood’s tokenization of private market securities. Should we go there
[00:46:58] Krys: Yeah, tell us about it.
[00:47:00] Luke: So my brother brought the headline to my attention and we’re out running and he explained what, let me explain a very high level what I think’s happening, and I’ve only done a sort of cursory look at this, but so many alarm bells.
So, uh, Robinhood, like the US broker, uh, for some time they’ve talked about tokenizing a. Stocks. So what do they mean by that? You know, say you could buy, you can buy like Tesla stock in the market today, and if you buy it on Robinhood or these smaller brokers, you can buy like fractional shares where they’re talking about putting those stocks on their own blockchain.
Um, and then you’d be able to trade like the tokens, not quite like Bitcoin, where it’s like a fungible market. I think their vision for this stuff is they kind of control the market and they’re the only kind of buyer or seller, but they’re kind of running a different kind of market. And it would be to sidestep some like market time.
So because this will be open like 24 7, it won’t be like five days a week, um, working hours and they maybe they believe they can, um, reduce costs and friction and kind of democratize investing more, like investing is pretty democratized. You know, maybe they’re, maybe they’re out there with a. Solution looking for a problem.
I don’t wanna give you the bait to go into like being a Procr guy, ’cause I know you are. You know, you love, you love. Uh, let’s talk about chain, link and crypto. In all its many forms. I don’t have a problem per se with that, but I do have a problem with some comments that, uh, the founder of Robinhood, Vlad 10, is that the guy, um, that he’s made recently and he’s announced, you know, not only are they doing this by tokenizing like public markets, they’ve also con very controversially, I think given away tokenized stock in a couple of very big headline pop, uh, private companies, notably SpaceX and Open ai.
Maybe there’s more in the pipeline and this is a very, very bad idea. And so that’s kind of where I wanna go with this topic. Why is this a bad idea? And I’m a SpaceX shareholder, so full transparency. Um, I’m not speaking from the perspective of that. Um, now I, I’m gonna link to a tweet if you caught our interview with, uh, Yannick co-founder, co CEO of public a few weeks ago.
Yex super guy, go check out the episode. It’s really interesting about like his vision for the future of investing and using ai, uh, as a kind of investing co-pilot as an investor, where his co-founder, Leif Abraham, made a really astute tweet about, um, or ex post about this, these act, proposed actions from Robinhood.
And he talked about concerns around, uh, liquidity and supply and investor protections. And really, I just wanna sort of dig into his tweet ’cause I think he’s really pulled out the biggest concerns with it. So. What’s really, what, what is it that Robin Hood are proposing, and what really is the risk here?
So, as I said, I’m a SpaceX shareholder. If I, I wanted to buy SpaceX stock, and it’s complicated. Like I can’t, ’cause I’m not, I’m not wielding like a, a multi-billion dollar portfolio. So I can’t go and buy stock directly from the company when they have like their series G or series H right. Their next round of private funding.
So what I have to do is I have to wait for like an existing insider to want to sell some shares, like a employee. If the company, maybe their stock options vested and they wanna realize some money to buy a house or whatever. So an existing insider sells some stock. And the, the kind of, kind of like the broker I worked with, I.
They, they set up an a special purpose vehicle. It’s like a special kind of company that only exists to be like the shareholder of that stock. And then essentially, I’m a shareholder in that SPV company like me and a bunch of other people. So simplistically, someone, someone identifies that maybe there’s $10 million of SpaceX stock available, puts in like a bid for it says, well, I’ll buy it at this price.
If we can agree terms that gets agreed. They create this standalone company whose sole purpose is to own the stock. Then they chunk it up into, you know, a hundred thousand dollars pieces, million dollar pieces, sell it to a bunch of individual investors, and then the deal happens. SpaceX don’t know who the hell I am.
I’m just like a minority shareholder of a minority shareholder. Um, but in theory, I hope I own stock. Now Robinhood are proposing doing exactly that, buying, I think. $10 million in each of these companies. Um, and then creating like an SPV, uh, having a custodian hold and manage the stock and then issuing tokens.
So the problem, well, can you see like the, the, the big problem with this, say we’ve got like SpaceX, a $300 billion company, and suddenly you have, let’s say, I’m making the numbers up a little bit, but I think this is directionally right, $10 million worth of that company on a blockchain and theoretically available to anybody.
Like, can you see what’s gonna go wrong if you do that?
I’ll give you a clue. It’s to do with demand and supply and the fact that like a lot of people want to be SpaceX shareholders, but maybe they didn’t, weren’t lucky enough to be on the email chain I was on when I had the opportunity to jump on board last
[00:52:55] Krys: are you talking about like somehow like diluting, like creating shares out of thin air somehow?
[00:53:01] Luke: Well, not so much that, but, but, but essentially demand and supply, right? Like, and the, like, if you’ve got, let’s say you’ve got a $300 billion company and you take this $10 million chunk of it, which is like, you know, what’s that? Like a third of a percent of the company or something like a tiny, tiny fraction, much less than that actually, like tiny, tiny, tiny fraction of the company.
But suddenly you make it available to regular everyday investors. And there’s so much hyper momentum around companies like SpaceX and OpenAI, right? The value of those tokenized stocks is gonna skyrocket, right? ’cause there’s so much demand for them and there’s only so much supply. So suddenly the guy who, like Robin Hood as this middleman, they’ve got this massive arbitrage opportunity because.
They’ve created this market that didn’t exist before. They’re selling like the tokenized stocks, and there’s a huge demand, and the tokenized stocks could literally become like 10 times or more the value of the actual
[00:54:03] Krys: right. right. So this is, let me ask you, let me pause you there, double check, because this is a weird thing. I discovered, like, you know, in the cobweb dark alleys of the regular market, most people don’t know this, but when you see a price go or down like the stock ticker, that’s always based on liquidity.
So for some major companies, most of those shares are basically somehow locked up. Call it locked up, they’re in. Whatever investment vehicle and they don’t really trade. So when you see prices going up and down, it actually could be a relatively small percentage of people that are moving the shares up and down.
Now in the open market, that’s just kind of how it is though. You think it’s the whole value of like, it’s like millions of shares, right? Going up or down or creating the price flow. But that’s not really how it works. That’s why, by the way, in the trading world, volume is so important ’cause it tells you how significant the signal is.
But basically what you’re telling me here is that this is a, a way to create, call it artificial constraint, which I don’t even know what that would do. Like you were saying to the, call it legitimate or majority of the other shareholders.
[00:55:17] Luke: It is. Yeah, it’s, it’s, it’s weird and it creates a really bad incentive on Robin Hood. For exactly the reasons you said, like they’ve bought this tiny allocation in a highly illiquid company that is in demand, but there’s no supply. Like you can’t go out and buy SpaceX stock. It’s very hard to do that. And it’s not available to, to the majority, large, large majority of investors.
And I got lucky having the opportunity, and even then my opportunity might be fraudulent. I might even not even own stock. Right? Um, and those are the risks of being a private market investor. Suddenly you say, okay, well know we’ve really bought these shares and you maybe you can evidence it. And they’ve issued the tokens and everyone goes, well, this is like, great, I can buy SpaceX and they buy like a hundred dollars worth of tokens.
Well, there’ll be huge demand for those $10 million. And I, it would be, it’s not at all out of the realm of possibility that the, if you just looked at the tokens, like the paper value of SpaceX, could, 10 x could be like a $3 trillion company now. Real SpaceX, nothing’s really changed, right? Like the, some guys over there were doing some nonsense with like $10 million.
It’s not relevant. The real value of the underlying hasn’t changed. Um, but the token holders will be going, woo, you know, we own this thing and there’s like, demand for it, and these tokens just will trade because of like hyper momentum around the token, not around the underlying thing, but it creates this horrible, horrible incentive for Robinhood because they have created this market and they say they’re doing the right thing for, for like democratizing investing.
So suddenly they’ve got these tokens that maybe imply like a $3 trillion valuation, but they can buy stock. If they can continue to expand their SPV, they can buy stock in the market, the private market at a 300 bi billion dollars valuation. So they’ve got this like massive 10 x arbitrage opportunity. So despite what they might say they’re gonna do, like they’re so heavily incentivized, they’re gonna do that.
They’re gonna buy more underlying stock, put money in their own pockets and issue the tokens at the current value. So that’s what’s that gonna do? That’s gonna like, you’ll get this vicious cycle over time where you’re massively gonna dilute the token holders, like the buyers of this thing who think they own in SpaceX.
And maybe they do, but they’re owning like a increasingly tiny proportion. Because if like, you know, say there’s $10 million worth of stock and you bought in, in that round and maybe robbing hook go, whoa, this is great. Like look, we’ve got this arbitrage opportunity, let’s buy another $10 million. Well they’re selling that into the market at the $3 trillion valuation.
So, you know, you, the original token holders have just essentially, if you really weed through the maths, like they’ve just got, like they’ve lost 90% of the value of the thing they actually invested in. ’cause it’s so disconnected from the underlying thing. It’s just really, really ugly situation. And it, it won’t happen so much with public market securities, but only because like those are liquid markets.
Uh, and other people like the market will arbitrage that itself and the market will go out and buy stock in the public market and then sell the tokens or whatever to like arb and steal some value, essentially, like eek some value out the system. But in this private market thing, ’cause it’s hard to buy.
SpaceX stock like Robin Hood are really the only people who can arbitrage this. And you can bet the bottom dollar they’re gonna.
[00:58:50] Krys: Uh, I know you, you, you really wanted to, um, avoid me going into Chainlink stuff and I will, I promise. No, no, but I only will say that I think this is why a big boy protocol like Chainlink is necessary for all these future tokenization pro projects. You need all the financial institutions to be above, not, not to be able to play these kinds of games.
And given Robin Hood’s history, unfortunately, it’s sort of in their DNA to play at the edges. So I’m glad you’re talking about this, and I think this only bolsters my case for Chain Link’s future because this is the very beginning stages of this kind of shift to tokenization, which is, uh, I think the legitimate future of finance.
It’s just that these growth spurts to continue to have these wild, wild west shenanigans, if you will. Um, so thanks point for pointing this out.
[00:59:50] Luke: Yeah. Yeah. Good stuff. Yeah. So anyway, be like. Buyer beware. A bit like the thing we just talked about with like garbage financial journalism. If you see a deal that looks good, too good to be true, like just apply your skeptical brain and be careful when you mess around in these deep, dark waters. I.
[01:00:09] Krys: of a too good, of a, uh, a good deal. before we start recording, I picked up, uh, half a share of AMD for my King of the Jungle portfolio, which I had. Uh, sold previously at $120 a share. So, uh, I, I’m basically, so far I, I bought high and I sold lower, so bad for Monkey, but I bought back, uh, a couple months later and I talked about why in the previous episodes, I won’t go over that again.
Short version is that I think they have what it takes to be the next major power juicer of the inference portion of AI in that being second best here relative to Nvidia, I don’t think is a bad thing. In fact, it’s. Going to incentivize some companies to challenge NVIDIA’s big bad monopoly with which nobody really likes.
Uh, and I’m not a real stickler for metrics, as you know. Um, like, uh, I think metrics, financial metrics get investors in trouble as much as they help. But in this case, I did come across a, uh, graphic, And this is, um, this is a ratio I’ve,
I’ve used, uh, well in the past.
It’s basically comparing the price to earnings ratio, which is usually a backwards looking metric to the rate of growth that a company is undergoing. So you want lower, lower is better. One is basically considered neutral. Anything over one is you’re paying. More for lower growth and anything under one is you are getting a better bargain for higher growth.
And uh, in this case, the math is pretty simple. Uh, the chart looks at the forward PE of AMD compared it by 30, which is about 21, dividing it by 30% growth in 2026. All of this obviously is estimated so it could change. That’s why metrics like this are problematic. But it ends up with the ratio of 0.7, which on this graphic relative to Apple, Google, Tesla, Microsoft meta down the line and I wanted to put AMD back on my portfolio specifically in mine.
Dear listeners, I’m constructing in my head what I call a basket of companies that represent AI as kind of directly on point as possible. So there I am calling my share in a lab part of the ai. Um, I’m calling, I Iris energy, the, the quasi Bitcoin maker, but actually AI data infrastructure builder as ai, now AMD and I’m calling Tesla also an AI company as long as NB as well as NBIS.
So I have 1, 2, 3, 4, sort of AI centric. Companies in one little basket called the AI basket.
[01:03:12] Luke: Very good. Nice. I like it. Very good. Yeah. Tuned in for last week’s episode to hear like more detail on the specifics of why Christophe thinks AMD is gonna be an inference winner. I think I agree with his thesis. I.
[01:03:26] Krys: And it’s a, it’s a, it’s a huge runway. Yeah. Sorry. I’m, I’m going. It’s, uh, even though, even though it’s already $220 billion market cap, which, uh, is, is not the kind of company I’m looking for right now, it is the cheapness of it based on that PG ratio, which allows me to say, despite the market being at all time highs, I’m willing to make an exception for AMD Yeah, moment.
[01:03:51] Luke: Great stuff. Well, I’ve got a basket as well that in my basket are sausage rolls, steak bakes and other vegan produce and like really, really bad coffee. ’cause what I, I bought in my King of the Jungle portfolio
[01:04:05] Krys: And we see Dear, dear listeners, you see this is a difference between Monkey and Badger. Uh, monkey is, uh, investing in, uh, inference AI powered, uh, Silicon Wafers, whereas Badger is investing in sausage rolls.
[01:04:21] Luke: Yeah, I’m a, I’m a, okay, I got this is like, I, I’m, so, I bought Greg’s the British, like institution fast, I guess. I guess if you applied like American terminology, like fast casual food and it’s like, I suppose it’s like the British version of, I dunno, I don’t wanna say like Chipotle, but something like that.
I suppose like, like fundamentally it’s not the kind of food I like to eat. It’s not very good quality food, but it’s got its raving fans. It’s like hugely popular. And if you’re a Brit, like you absolutely know who the hell Greggs are. And I looked at them a bunch of years ago. and they were going into like growth mode and they were gonna have to spend quite a lot of money on CapEx on building out like a big new distribution center.
I think they got a target of trying to double the number of branches they have in the uk. They’ve got, I dunno the exact numbers in front. They’ve got like 2000 something branches now. They’re trying to get to over 3000 branches. it’s a good company. It’s a good quality company. The finances have suffered and they got a real knock in the market last week, which put it back on my radar.
They took a 15% haircut. ’cause if you, if you’re in the UK or in probably in like western Europe, we’ve had like wildly hot weather in the last couple of days. I was bitching to moan about the weather and Christophe was like, you ain’t heard nothing. Right. Those are rookie numbers, but it was fricking hot in the UK and if you selling sausage rolls and steak bakes and coffee.
Uh, they do by the, well sell the worst coffee I’ve ever drunk from any outlet anywhere in the
world. like
it’s terrible.
[01:05:57] Krys: Oh my
[01:05:58] Luke: Yeah, that’s right. Yeah. if, if you’re selling, if you’re
[01:06:01] Krys: trouble. They sell the worst coffee. It’s hot in the uk. Oh man. Where do I? Sign me up, Badger.
[01:06:09] Luke: Um, well they took a, they took a smashing because like in crazy hot weather, uh, you’re not gonna sell much of your stuff. Like, just, just, it’s the wrong market for you. People want like salads and stuff, I dunno, cold drinks. and so, but it was so bad that they reforecasted their sales for this year, uh, like materially down from their prior forecasts.
So market went, ugh, and then like, this coffee tastes shit the market said, and they sold off the stock by 15%. So that was just enough of a catalyst to kind of push me across the line. So I’ve taken a. One and a half percent ish position in my Real Money portfolio, and I’ve bought 10 shares at 16 pounds, 59 in my King of the Jungle portfolio, so about 150 to kind of 200 bucks in my King of the Jungle
[01:06:57] Krys: Oh wow. I didn’t realize you went that big. That’s kind of.
[01:07:00] Luke: Is that big? I don’t know. Oh, well, I mean, I, I’m trying to manage it like, you know, 10 or 15 positions about, you know, 10% each diversified portfolio.
[01:07:10] Krys: Yeah. No, no. I mean, but actually, if I could rewind the tape a little bit, because there’s something interesting here in terms of portfolio management. Um, one, I say it’s big because relatively speaking, we’re modeling this portfolio for anybody that wants to start investing. And we give ourselves $200 US dollars each month, which we think is a relatively achievable sum for pretty much anybody that has a job, right?
You could save 200 bucks. And so the fact that you said you put in 150 worth of out, uh, so that’s kind of big and that’s sort of a month’s salary the way we’re framing this into one company. So it’s like not a little nothing. It’s like, oh, you’re, you’re actually establishing a legit position, um, in this, right?
Uh, I wanted to say regarding AMD that I bought half a share. Which is, uh, each share right now is 137, so it’s about cost 68, $70 worth. But this is what I like about fractional share stuff, is that it didn’t matter if I bought half a share or a quarter share or a 10th of a share. The main thing is that I bought that, I identified the company, I did the research, and I bought some amount.
And that’s the thing we wanna keep returning our listeners to, especially if you’re younger. Don’t let the share price itself or the amount actually, uh, prohibit or dis dis incline you from participating. Build that habit. Just buy, buy a little bit of it, and, and you’ll be fine.
[01:08:43] Luke: Yeah, that’s good. You’re right. And we, we should probably like revisit some of the good disciplines around portfolio management in a future episode. ’cause that’s like a whole like, aspect of the art of being an investor in itself. . I bought a piece of it and I was happy to size it appropriately in my portfolio.
Like in my King of the Jungle portfolio. I think it’s worth about what six, four and a half thousand pounds is my size of my total portfolio now. And so what I’ve just bought a hundred. So what is it like I, it’s like a seven or 8% allocation, something like that, that ballpark, maybe a bit less. Um, I was happy to do that because the financials looked decent to me.
Like this picture we’re looking at now, the market cap, uh, you can see is kind of back to 2020 kind of levels, a 1.75 billion pound company. Um, but the stuff I’m looking at, the gross profit has been growing nicely and steadily. Like gross profit is like the money you’ve made before any of your operational costs.
So it’s like, you know, if you sell more sausage rolls and if you make like a tiny bit of money on every sausage roll, you’re making more gross profit. Um, so that’s an important metric. Free cash flow is down, but free cash flow is like the money that the board has to allocate after CapEx. And so if you, if you understand the story, which I’m trying to do, the company is spending a lot of money on CapEx ’cause they’re building out their distribution network and their branch footprint.
So that makes sense that free cash flow is going down. And if you wanna like back that out and see a nice clean number, well, a good metric right now for the company is priced to operating cash flow, which is the purple squiggly line on there. And you can see on a operating cash flow basis, it’s about the cheapest.
It’s, it’s almost ever been unless you like wind way, way, way, way back. This is a hundred year old company, but um, yeah, it’s, it’s pretty cheap right now. And I didn’t show it here, but they pay a dividend and you know, I’m not Mr. Sausage rolls and boring companies. I mostly own like tech stocks and growth stocks.
And I do need to balance out a little bit. And part of that is wanting to get a bit more dividend income into my real money portfolio. ’cause that just diversifies me a little bit. And I don’t really own anything British apart from Wise. So now I’ve got like Wise and Gregs,
[01:11:07] Krys: Yeah, I’m glad you mentioned the dividend. That’s not a small, uh, consideration, especially if you are living off your portfolio. So if you could find a good deal like it seems you have with this, that’s just, uh, more proof in the sausage pudding. I don’t know. Do, do, do people put sausages and pudding over where you live?
[01:11:30] Luke: no they do not. That’s that. That’s meaningless then. Okay. All right. Well, we, we use fiscal AI there to look at that graphic and I’ll do all the other research for the show, like it’s our favorite investing tool. So do check out fiscal.ai, previously known as fin chat.io. Um, if you use fiscal.ai/wildlife to go sign up, you’ll get a handsome discount. And they also are just about to launch an enterprise tier.
So enterprise tier, quite exciting. Whole bunch of new features, 20 years of investing data. You’re gonna struggle to find that on any other finance site. They’re building integrations with Excel and then they’re gonna start reporting standardized versus as reported data with like links into 10 Ks and 10 Qs and decks.
And they’ve got a whole bunch of like AI tools built on top of very robust, very deep. And nuanced data, including their own segment data. So Christophe and I are big fans of this service. We highly endorse it. The free version, just go and use the free version. If you don’t sign up just to get started.
It’s really, really good.
[01:12:43] Krys: Excellent. And if you wanna check out our trades in pretty much real time, head over to patreon.com/wall Streete Wildlife and check out our, uh, trade channel in the regular Jungle Lounge where we talk about our best investing ideas and, and build community.
[01:13:01] Luke: Yes sir. Yes sir. Very good. Uh, are you ready to become a beast of an
[01:13:06] Krys: Your journey starts here.
Ah.
​
