Hi everyone, Joe for jazzy's casebreaks.com coming at you with a one box break of 2023 Panini National Treasures Collegiate Football Random Number Block Break number four also happens to be the fourth box and final box of that case we popped open and for tonight only we're giving away an extra spot there the numbers right there so big thanks to Robert and Eric for getting in on it all of you have a shot at an extra spot we'll buy one get one opportunity after three and a one four times aim on top after four one two three and four Eric had the odds on his side after four gets the extra spot thanks Eric for grabbing the big chunk of spots there now we've got everybody's names there are the numbers now let's roll it and randomize it six into six twelve times one two three four five six seven eight nine ten eleven and twelve six into six twelve times for the numbers one two three six seven eight and twelve six down to zero zero gets any and all redemptions including one of one redemptions but Eric also has a number one so Eric give all the numbers except for the number two Robert you've got two let's order these numerically I doubt there's gonna be any trades I'll leave the video running Eric Robert any trades or should we just roll and again there's that final box right there number four no doesn't look like anything in the chat all right trade window going once trade window going twice type in TWC trade window closed in the chat printing and ripping that is what we are doing here is the official list hot off the presses thank you thanks for hanging with me on a Monday good luck we got a book in there as well empty box on that side all righty good luck right off the top 8 out of 75 Doug Flutie Eric with the number 8 we have Ronnie Bell Ronnie Bell 9 out of 25 that will be for Eric and the number 9 college silhouette signatures K. Shawn boot 14 out of 25 Eric with the number 4 if you're not familiar with this random number block format we go by that digit right there ooh nice nice bowl patch a Chick-fil-A bowl Chick-fil-A something bull three out of ten Kenny Macintosh bum that's the Macintosh that's the Apple startup sound very cool patch that'll go to Eric number three last bot mojo and we've got Dorian Thompson Robinson 10 out of 99 you go to Eric in the number 0 Patrick saying that's the peach bowl the Chick-fil-A peach bowl thank you the book is Michael Mayor Raiders tight end to 99 and it's 85 out of 99 nice dual relic an autograph and a redemption here to start to get a little more involved each week with my team the Raiders Eric with that one that's with the extra spot that you want Eric then a slider box alright redemption all already for you Eric it is wow Brian Breesie Miles Murphy dual signatures blue are we gonna get something for Robert or is Eric gonna sweep the box let's see it is seven out of ten will Anderson Jr. and Eric clicks is gonna sweep the box sorry Robert appreciate you getting in though we'll get him next time Eric took the risk congrats to you swept the box seven out of ten nice patch as well real solid there's a chance that we'll see how the rest of the last half of the games pan out but we could see another same team getting the offensive and defensive rookie of the year Houston might get defensive rookie of the year they might there should certainly get off into rookie of the year there you go gang I'm Joe for Jasper's case breaks calm school is out of session on this collegiate we don't have any more for now but keep your eye out maybe we'll get some more later on thanks for watching thanks for breaking with us I'll see you for the next one


Welcome back to the podcast. It's the end of the week. So time to talk a little global markets. And in this episode, we're going to talk about the fall in the US and UK inflation. What does it mean for interest rate expectations and thus the markets in terms of quite a severe reaction in the markets in a positive way when that data hit earlier in the week. We're also going to have a look at the latest filing from the infamous hedge fund manager of the big shorts, Michael Burry, a lot of headlines flying around about how he could have lost a lot of money caught the wrong side of this rampant market. However, perhaps you're just misreading the headlines when it comes to that one and peers will break that one down. Hopefully look to explain. We'll also talk a little bit about the Oracle of Omaha Warren Buffett, because in these filings which come out quarterly, and we've also seen that his holding of Apple is now just shy of 50%, which is incredible in terms of a single allocation to one company. We'll explain a little bit of why that numbers crept up, but also a little bit about what else is going on with Buffett's portfolio. Everyone's always interested in that following what he's doing, of course, from an investment point of view. And then finally a quick word on the political front. As you can see and know, neither peers are our politicians, so we won't look to breach in any shape or form about our political views. However, there's been two meaningful things this week. President Xi and US President Biden have met in San Francisco. And also UK Prime Minister Rishi Sunak is going one more throughout the dice to try and keep his election hopes alive with a significant cabinet reshuffle with a former PM coming back to the forefront. So we'll have a quick word on that as well, but peers, perhaps we can start with the inflation data that came out this week and the US numbers in particular. Yeah, inflation numbers were were amazing in that they went down. So inflation going down in this point in time is a very positive thing having had an inflation crisis, of course, over the last couple of years. And there was one, there's one, there's one individual item in the inflation basket, whose number was particularly important that I think was really the single item. In what is a complex calculation, inflation, there's one single item that sent markets like boom through the route, like the S&P was up 2%. And maybe more interestingly, something called the Russell 2000, which is a US another US stock index, but this is a, it's a small cap stock index. So it's like, it's 2000 small US companies that went up that ripped 5% of the back of this data.  So it's all about, you know, the good old story of the Fed at the end of their hiking cycle and, you know, what's going to happen in 2024? Are they going to start cutting interest rates? And before we delve into it, the reason why smaller companies perhaps ripped higher at a faster rate than the big old S&P 500 is because typically smaller companies are more sensitive to interest rates. Smaller companies are typically more levered, they're borrowing more, you know, the big boys in the S&P 500 typically are very mature companies that are very cash generative. And so I don't have much debt on their books. So they're less sensitive to interest rates going up, right, or down. So yeah, it's the small guys that have been suffering from these interest rate costs rising higher. So any information that can tell us, and well, I should say, those small companies, their share prices have been hammered this year, like big time, certainly the tech small cap, you know, down 75%. So it makes sense then when the rationale for the big sell-off is now turning, it obviously makes sense that it's these stocks that have the big fall are now trading at very cheap valuations. And if the reason for the fall is no longer there, well fine, you're getting the buyers coming back in and they popped higher. The individual element in the inflation report, because remember inflation is measuring the cost of goods changing over time and there's goods across all the items you could possibly think of that you're spending money on. So there's energy costs, there's food costs, there's house costs, there's costs of whatever, Spotify, whatever you spend your money on, right? One thing in the report is then it's rental inflation. And this has been one of the key things that has taken the longest to start to dampen, okay? So remember inflation, the headline measures peaked in the US at the start of this year. And they've been coming down ever since, right? And this has been part of that story. And I mean peaked above 10% and now the trajectory is down. The Fed wants it back at 2%, okay? But we're not there yet. So it's been trending down and trending down and we're like, well, is it going to trend all the way down to 2% and find the Fed won't have to hike anymore? Will it trend below 2% in which case the Fed might have to start cutting? So is it going to get down to 2? And we thought it was on the way. And then in the summer when you hit July, well, June, we hit 3%, right? So it's come from 10% down to 3% and we're like, right, perfect. This is great. In July, it went back up. It went back up to 3.2%. In August, it went back up to 3.7%. And it's through that summer period, that quarter three period is where you've seen stock markets come back down, okay? Because we suddenly thought, we're not going to make it to 2%. Inflation is on the way back up. The Fed are going to have to continue to hike, right? And it was the rental inflation in particular that was part of this story where inflation started to tick back higher. And the rental inflation component last month, like measuring for the month of September, spiked. It didn't just tick back up, it spiked back up. It went from about 4% in August and it spiked up to nearly 8% in September. And everyone was like, oh my God, the Fed are going to have to hike. This hiking cycle is not over, you know, but the key reading in the report for October, which was the reading we had this week, that rental one went from nearly 8% back down to 4%, showing that the September print was some weird noise anomaly. And look, you do sometimes get that. These readings month to month can be very noisy. And so it's like big sigh of relief that spike up in rental inflation in September was not sustained, we're back to 4%, so we're back on this idea that the headline inflation is on its way down to 2%. And so now the story's turned even to, well now we're reassured, is it going to continue to trend below 2%? And right, our rate cuts back on the table for 2024. Right, and on that point then, let me just introduce some of the views on Wall Street, because they're talking about that last point that you mentioned, which was when are they going to start cutting rates? And there's a little bit of diversion between, or division between the likes of Morgan Stanley and Goldman Sachs. So two of the banking giants. So I'll give you MS's view first. And I'm going to ask you, what do you reckon they're going to be bullish or bearish? Well, the biggest grizzly bear on the street, I'm assuming they're playing to type and will be massively bearish. Right, so they think the Fed will start cutting rates in June of 2024, then again in September, and every meeting from the fourth quarter onwards, each in 25 basis point clips. And Morgan Stanley think rates will hit 2.375% by the end of 2025. So start cutting in June next year, with an end target of 2.375% by the end of 2025. So for Goldman Sachs, they see the first cuts coming in Q4 of 2024. So six months later than what MS foresee. And they say followed by one cut per quarter through going further through mid 2026. And a total of 175 basis points with rates settling in basically a three and a half to three and three quarter percent range. So a whole 1% higher than Morgan Stanley. So I think that's the key difference here in those two outlooks. You could say on the one hand, well, they're the same in so much as both think rates are at their peak now. Both think rates are going to start to come down beginning in 2024. That's where the similarities end. So the differences are the timing of the first cut and how many cuts are they're going to be in the cycle. And that's where they're diverging. So Goldman's think they'll cut later. The cycle of cuts will be slower and overall smaller. So Morgan Stanley's view is more positive for stocks in the short term. And I know it seems a bit it can seem a bit disconnected when we're thinking on the one hand when you're hearing us talk about right what. By how much my interest rates go down in 12 months time in the in the period of time between 12 and 36 months in the future. It seems a bit. Well, all right, how's that important now? Well, what you've got to understand is the bond markets are reacting to this stuff like now today. So I said that the S&P was up 2% Russell 2005%. Well, we have massive moves in the bond markets off the back of this data as well. The two year yield dropped 21 basis points, which is a lot. And then the 10 year yield dropped 19 basis points. So so those yields, well, they're actually having basically an immediate impact on interest rates right now today. So on that two year yield side, I mean, people, there's a lot of people that have bought and we'll talk about the the your man from Omaha in a minute or in Buffett. He's been buying up T bills like it's going out of fashion in the last nine months because they're yielding 5%. Right. But when I said the two year yield dropped, that means the amount of interest they're getting on their two year T bills is now getting less. So the point is, well, hang on, less attractive interest from your bond position. Well, shouldn't I now sell out of that then and buy stocks. So it does have an impact right now today in financial markets, even though these are concepts that may not play out until 12 to 36 months time. So, you know, to go to go then that one step further or why are these banks thinking differently about how the Fed might behave. And then it comes down to, I think Goldman's look like they're more positive that their outlook on the future is more positive from an economic point of view. And they're probably in the note what's what's now being coined the no landing camp. The idea we were talking about is it going to be a hard landing or a soft landing, meaning are we going to have a big bad recession, hard landing, or are we going to have a mild recession, soft landing. Now it's no landing, like no recession. Right. And so Goldman's are in that camp where they think rates will come down a little bit, just to kind of keep inflation at the 2% point but there won't be a recession. Whereas Morgan Stanley might be suggesting they think that there will be a recession so that rate cuts won't just be about managing inflation, it'll actually be coming in as more of a stimulative, more aggressive stimulative measure to boost growth out of recession. How do you think internally it's perceived when you have a macro house view and you have divisions in your bank, like an investment banking team, which are very much cyclical with the economic environment as to activity. Do you think that they feel when they have these like Uber bearish scenarios, which would be problematic for different parts of the bank, do you think there's like grumbles between divisions or is it, is it beyond that. I mean, I think, well, firstly there's Chinese walls right so that whatever the research team think whatever the Morgan Stanley macro research team think doesn't necessarily mean right that's what the rest of the bank also think and that's how the rest of the bank are now going to behave. There's separate divisions and indeed, yeah, a lot of their research they put out is saying conditions are going to be such that they'll be bad for our bank overall, but you know as a research analyst you've got to be impartial right it's not. Oh, I'm not going to suggest a bad thing because that's bad for our company, you go entirely separate it. So here's why it's good to be known to be the bearish on the most bearish on the street all the time to be known to be labeled. It's a good thing because what you're in the business of selling research right your team generates revenue from clients buying your research so who are the clients, well the clients are the buy side. So that's the financial institutions like asset managers and hedge funds and so on okay they're buying your research also the other the other sell side banks will be buying your research as well. So let's just take an example of an asset manager you're running a portfolio. Now your job is to manage your clients money and deliver the best return you possibly can. So your job as part of the decisions you're making. What should I do with the portfolio what should I be buying. What should I be selling should I be changing strategy keeping strategy. You want to do a lot of research yourself and a lot of reading. So if I'm a portfolio manager I would buy really bullish research and I would then buy really bearish research because I want to see the angle and the point of view of people that are sat on both sides of this argument.  And then right myself. I'm going to take my view on where I sit on that spectrum. So Morgan Stanley being labeled the bears is great for them because they're going to get a consistent revenue of people buying their research. Because people always want to read about the bearish view along with the bullish view as well. Now, if it was based on rational research though. Surely if I'm a junior research analyst and my superior and the voice of the bank is bearish but I analysis shows that we are too bearish. What happens then. I need to move move company. Yeah, I think you'll just get kind of batted off and probably largely ignored I think you'd be brought up with that ethos of we are the bearish view. And that's how we make money and that's very much the label we want to retain. I would suggest. So I wonder if that gets get is sticky for you in your career in terms of how you are known from your more nuanced part of your CV. Think about it though like from a man like if you're if you join a business and you're the youngest will of course right you don't know much and who you're going to learn from what your superiors. So you're learning from the bear.  You do carry that around with you for the rest of your career, maybe. Yeah, I'll be like Pierce why are you just so miserable. I couldn't work in the Morgan Stanley research fund. I'm too much of an optimist. All right, well let's move the conversation on to the UK, where headline CPI consumer price index rose 4.6%. So it's still rising at this point to show 5% from a year earlier. This is for October, but it's down so it fell from 6.7 to 4.6. It's the lowest pace since 2021 enough that Rishi Sunak was right on it. I think 60 seconds after that data came out he was tweeting mission accomplished. I've halved inflation, as I said I would. But perhaps you can explain a little bit about why such a dramatic fall and any differences here between the US and in the UK. Well you can maybe tell me about the detail here. I'm less in tune with the under the bonnet stuff with the UK. Maybe I'll just talk a bit more about. I'll give you some flavor then. So I mentioned the headline CPI. So lower energy prices basically gas costs were down by 31% in October compared to a year earlier. The city was down 15.6%. Core and services inflation, which is now the new super core or core core reading that people tend to gravitate towards because it's particularly watched by the Bank of England for signs of underlying inflation that was weaker as well than what economists were expecting. So just down across the board basically. And I think it's the, it's the size of the drop. I mean, I'm just looking at the headline inflation chart over the last 12 months and 12 months ago, a bit like the US you know we kind of at the peak for the UK our peak was slightly higher at 10.7%. It's been trundling lower since then and prior to the reading we've just received so the for September it got down to 6.7. So UK inflation was dropping but it was dropping from a higher peak and dropping at a slower rate than the US. Okay, that's why we were more hawkish about the Bank of England and had the Bank of England have raised rates. You know, later, I mean the Fed stopped hiking. Okay, I remember now you might have to remind me but the Bank of England stopped hiking later if you see what I'm saying, because our inflation was staying stubbornly higher. Well maybe not anymore because it dropped from 6.7 in September to 4.6 that is the biggest month on month decline in this whole downtrend from the peak. So it's like suddenly we're getting an acceleration in the decline, which is obviously very positive when inflation is too high. The big danger here is if we're suddenly accelerating and that acceleration doesn't slow down, well we could nosedive into deflation. You know, if it's dropping by more than 2% from one month to the next. I mean, by the start of next year we could be in deflation on that kind of rate. So it does set some alarm bells. So just break that down for someone who doesn't study economics. Why is deflation you're suggesting a bad thing? Yeah, well, inflation is way easier to understand. That's the prices of goods going up too fast. You can't afford to buy as much anymore. So naturally consumption drops and then that's a recession. Deflation is a bit more counter-intuitive because you might think the opposite. Well if deflation is prices are dropping and there you the immediate thing is to go great. Right. Awesome. I'll buy more and I can afford to buy more stuff. Great. I do buy more stuff and consumption goes up except you've got a factor in the human behavioural thing. Because when prices are dropping, do we just gun in and buy more stuff? No. We start thinking, well, hang on. Maybe they'll continue to drop. So if I think the price is going to continue to go down, you know what? I'm going to wait. I'm not going to buy now. Maybe if I wait, it'll be even cheaper. So that damages consumption as well. That's the annoying thing about inflation. If it's too high damages consumption, recession risk. If it's too low or negative damages consumption, recession risk. That's why you've got to get it in the sweet spot, which is around that 2% point. So, yeah. The Bank of England will be sat quite nervously, I think, about that sudden drop. Just because you don't want inflation moving too fast because then it's out of control. And then their jobs even harder. I wonder how those, I think it was three dissenters who said, we need to hike now again because inflation is not done yet. They're looking a bit silly at this point. One thing I guess timing wise is that the kind of backdrop politically, obviously there's a lot going on. We'll discuss Rishi Sunak in a cabinet reshuffle. But also the government delivers its autumn statement next week as well. So it couldn't be better timing, I guess, from that perspective. Rishi certainly will not be saying what you just said though. No, no. Well, it's perfect for Rishi because he had that. He kind of nailed it on the post the start of the year. I will have inflation before year end. And he's just done it by October, right? So he's like, so he's actually suddenly Rishi's weirdly said quite a good week, even though he was backed into a corner with this whole... It's Tuguella. Tuguella. I had a mind blank there. So the Home Secretary and the chaos around the marches and her thoughts on the police. And it was just a just dumped a massive bomb into Rishi's lap. But the last couple of days, he's done a pretty big U-turn. I mean, obviously you would suggest way too little, way too late in the grand scheme of things. But nevertheless, he's had a good few days and this inflation print has allowed him to come out and say, there you go, I've delivered the autumn statement. There's supposed to be maybe some tax breaks for businesses that might be coming down the pipe. There won't be tax breaks for consumers is what the noises are saying. But well, maybe they'll be more confident and more aggressive given this inflation print. Who knows, maybe they'll give, well, that's some more giveaways. But we'll see. Yeah. Good for Rishi. Yeah. I was thinking when I was watching the news last night when he made that commitment, I was thinking, God, you know, like something like the invasion of Russia and Ukraine, like, was it going to happen? Most people would have thought, yes, but you could never have predicted the timing. So for him to just come out and go, yes, because it makes sense. It's not going to stay that high. It will decline. There are some significant risks to that call. I bet when other Middle Eastern potential contagion fears were kicking off a few weeks ago, that call could have gone completely the other direction. But thankfully, it hasn't happened. So final thing, little quiz, mid-show. Just with this talk of English inflation. And I was watching this BBC documentary, actually, to cue this up about the Union. I encourage everyone to watch that. Absolutely fascinating four-part mini series where it talks about the history of the Union. Right. And I always think, OK, so when you think of Scottish people, you think, OK, specific music, the bagpipes, when you think about Haggis the Food, you think about Willem Wallace, and then you think about the Welsh, you think about the Irish. They're very clearly defined cultures. When you think about the English, you're kind of like, what is it to be English? So aside from chicken korma and things like that, the English breakfast is obviously a staple. Here's your quiz about the good old English breakfast prices now compared to this time in 2022. So I'm going to ask you two questions. OK. Anyone listening can take part. Which item do you think on the plate on your English breakfast? Americans are probably very confused at this point in time. Do you think has gone up the most in year-in-year percentage change? I mean, let's not go down the conversation of, well, hang on, what's on your plate? Because an English breakfast. No, no, no, no. I'm not talking. There's no avocados. I've got one. There's no, like, rye bread. Yeah, you smashed that, though. I've got, I'm going to say eggs. OK, correct. Eggs. How much do you think they've gone up? In the last 12 months. Yep. 21%. 16, 16.1. OK. So what's, there's two items, only two out of a list of 10. Where price has actually gone down. What are those two items, do you think? Two items. Pork. No. No, that's actually the third highest. I was going to say I was very uncomfortable when I said that. I'm going to give you a hint. Baked beans. I didn't want my hint. You're just shooting from the hip now. So, no. The one that can extend beyond the plate. Bread. Part of the breakfast. Bread. No. I'm going to give you one of the two. OK, go on. Block butter has seen the biggest decrease. OK, all right. It's down over 4%. What's the other thing, though? What do you have with your breakfast? Tea. OK, if it's not tea, it's coffee. Right. So coffee is down 2.5%.  It should be a tea. It should be a tea, really. I don't know why. Bloomberg needs to up their game there. No one has coffee with them for English, does it? That's the problem. Yeah, apologies. It's only Americans listening. Coffee. How coffee's gone down? How much did you say? 2.4%. Right. Interesting. Yeah. So everything, milk is flat. Mushrooms up 3.5%. The average plate of your full English has gone up 7.3%. There you go. So yeah, you're going to have to just stick in there. The prices will normalize, I promise you. But look, let's move the show on. Let's talk a little bit about Michael Burry. Those who are, I guess, more interested in finance will recognize that name and that person. But perhaps you could just give us a brief summary of his history. Like why is he someone who always grabs a headline or two? Well, it's because of one trade. This guy's been at it. He runs a hedge fund. Here's a quiz for you. Back at you. What's the name of his hedge fund? I don't actually know how you pronounce it. It's like Skyon or Skion or something like that. I would say Scion. Scion Capital is his hedge fund. But look, he's obviously, he's been, I don't know how old his hedge fund is, but it's definitely, I don't know, 25 years plus, right? But really he did one trade that got serialized in one of the best movies of the last 20 years. So he did one trade and it was all part of the great financial crisis. And he shorted the US housing market. Let's just simplify it like that. That's how the press talk about it. It's a bit more nuanced about, well, how did he short it and what kind of products, but I won't go into that. He shorted the US housing market at its peak and then it collapsed. That's what led to Lehman Brothers going bankrupt. That's what led to the global financial crisis. And if you like your movies, you should watch The Big Short, which I'm sure most people listening might have already watched that. But yeah, he was, what's his face? What's the actor? Christian Bale. Christian Bale, thank you. Christian Bale in The Big Short was playing Michael Burry. And it was about how he profited billions in the end. The great thing about the movie and the trade, it almost bankrupted him. Before then it spectacularly came good and he made an absolute fortune. So what makes this such a story that resonates with people? It's like David versus Goliath, him against the system. The government is doing this, all these banks from the street are doing this. I'm betting against it. Almost comes back from the brink off the canvas. It's got all the hallmarks of a legendary story. Absolutely. So ever since every single trade he's ever done becomes sensationalized and grabs the headlines and it's good clickbait, let's say. For financial media, Michael Burry in your headline is good clickbait because everyone knows about him from the crisis. So anyway, he's back in the news and the clickbait. Well, I think actually wasn't the headline, Michael Burry's lost $1.6 billion shorting semiconductors. Well, yeah, that's what I was sent by none other than our dear co-founder this morning. There's many, many things wrong with that sentence. Not less than the fact that it's entirely untrue. So basically he put on a trade. The thing about this is we don't know what his P&L was for this trade because all we know is he put it on at some point in quarter two and he took it off at some point in quarter three. And the timing of entry and exit entirely obviously determines whether you make a profit or a loss from any trade. And so that's for one thing. This whole $1.6 billion thing is also false. So he placed a bearish bet on semiconductors, meaning he thinks that the share prices of semiconductor producers like NVIDIA, for example, are going to go down. There's various different ways you can place that trade. The way he did it was using put options, which I won't go into the details of here and now, but this is a derivative product that enables you to profit from the price of something dropping. Now with options, you have either the nominal value, which is where this $1.6 billion comes from, or you have the market value, which is the actual amount of money that Michael Burry paid to put the position on. The nominal value is just like, well, theoretically, what is the worth of this trade? Should all these options be carried to expiry and then the exercise of these options take place? And yes, so one options contract typically translates to 100 shares. So depending on how many options contracts multiplied by 100, that's the number of shares he's going to have to buy or sell. And then what's the share price of the shares at the moment? Right, that all adds up in this big calculation to $1.6 billion, okay? Except for Michael Burry, that's a reasonably irrelevant number. The market value, the amount of money he paid to put the position on, is just the price of the option at the time he bought it. His exit, he won't exercise these options necessarily. People come out of these options positions before expiry and they don't get exercised and actually, therefore, the amount of money you make or lose is just the difference in the market price when you bought it and when you sold it. And it's a tiny fraction of a $1.6 billion thing. So that's one thing to say. It is feasible if he did short the towards the end of June and if he took the position off at the end of September, well, actually the semiconductor stock prices went down. So he would have made a profit. So we don't know the timing as to whether he made a profit or took a loss or how big it was. But yeah, it makes for a great headline even though it's false. Yeah, I think actually over the period, they were down about 3.5% to 4%. Yeah. But if he put the trade on at the start of quarter two in April, he would have lost a load of money. And the other thing here was that, I think these were two different bets. So initial bet was against the S&P 500 and that 100. His latest wager is against the semiconductor stock. So maybe we can talk about that a little bit. Right. Because one thing here is that, I think yesterday a site, it's before that, NVIDIA was kind of on course for 11th consecutive update. In those 11 sessions, NVIDIA shares are up 22%. That's equivalent of $220 billion of market cap in 11 sessions essentially. Yeah. I mean, that's pretty phenomenal. And that's a record streak in fact for NVIDIA. So even though that AI bubble feels like it's perhaps just come off the boil a little bit. I think you had that announcement more recently with open AI and more investment, Microsoft. Right. They're pumping the co-pilot enterprise stuff. And it's just gone gangbusters again. But for many people and perhaps you as a former trader, now investor could say a little bit about why when a company does that, it can make other people think it's now in territory for a quite a significant pullback, which is I'm assuming why Barry is sniffing around semiconductors. Here's the argument, buyers or sellers, if you're a buyer, you've just given the argument. Microsoft, way more investment getting pumped in to kind of build out your AI offering to your customers. You need compute. You need semiconductor chips in order to provide these platforms for your clients. So you're going to need to buy way more of these chips. Great for NVIDIA. That's your bullish case. And short-term, I think that's true, but the argument is, well, has the short-term benefits to NVIDIA now been fully priced into its stock? The longer term is a different. That's where your risks come in, because it's like, well, A, this is so new, right? And NVIDIA are flogging these chips for, I mean, was it $40,000? Yeah, $40,000 for the main chip. $40,000 a pop. Now, you know, take the tech industry back through time. What happens? You get a new product. A good example. I bought a widescreen television in 2005, maybe. Oh, God, that was expensive. And I paid 5,000 pounds, right? And it was this amazing thing. No one had that. It was like, wow, I felt like I was the king. You can now pick up a way better television, way better for like 500 quid, right? So the point is that as other competitors come into the market, then you get this battle for market share, which typically sees the price of the product falling, right? So there's that one argument. And then the other argument I've already said, it competition, you know, there's other big players that are starting to create their own chip rather than having to buy NVIDIAs, right? So in the longer term, maybe NVIDIAs market share is going to be eroded by competition. The price of the product is going to come down anyway. So yeah, maybe this price right now is looking pretty toppy. That's Michael Burry's view, right? But he'll be sat there over the last two weeks, very uncomfortable, as this thing pings another 20% to the upside. Well, he's had a lot of training and being uncomfortable over the years. He's absolutely cool as a cucumber at the moment. But maybe we could pivot to a very different character of investor. You've gone from Michael Burry to Warren Buffett. So tell me a little bit about what we learned from Buffett's portfolio disclosure. Well, so I guess, again, looking at the headlines, that clickbait headline was that his Apple holding now makes up 50% of his portfolio. I feel like you're taking a pop at my newsletter here. I did lead with, do you like Apples with the people hunting? Yeah. So yeah, look, I was on that bandwagon, I'm afraid. Well, it is quite amazing, right? Because anybody who's studied portfolio management or has been a portfolio manager or runs their own portfolio, one of the key words, lessons that gets drummed into you is diversification. You've got to spread your money. Don't put all your eggs in one basket. Spread it around to spread your risk. And yet here's the king of all long-term value investors, the absolute undisputed king on the hill. And he's got half of his money in one stock. So it is quite unbelievably remarkable. I guess that, whilst that sounds interesting as it is, the thing is the proportion of his portfolio that is Apple is going up, not because he's been buying more Apple shares. It's been going up because the value of his Apple shares that have been fixed, he owns 9 million, 9 million, that's completely wrong. 915,560,382 Apple shares. Wow, I'd love that. That makes my holding sound very insignificant. That number of shares has not changed for the whole year. So he has not bought or sold one share. But the proportion of his portfolio has changed because obviously the value of Apple shares changes. And it's changed. The value of Apple shares have gone up a lot this year, not much in the last three months. In fact, Apple's slightly down. But the first six months of the year, they've boomed. And so other parts of his portfolio have maybe gone down. So really naturally through market shifts, the proportion of his portfolio that's made up of those Apple shares in dollar terms has gone up. So that's one reason why it's risen. But I mean, that still doesn't get away from the fact that it is 50%. But he's a long-term value investor. So what is the general flavour of the other companies within that other 50%? Well, his next biggest holding and the stats I've got, well, actually, let me just switch up to different graphics. So 50% for Apple. The next biggest is 8.1%. I'm going to go to a more granular view. Hang on, these stats are a month old. So his next biggest is Bank of America, which is 8.6%. Then it's American Express at 6.8. Then it's Coca-Cola at 6.5. Chevron at 4.5. He's cut his Chevron holding. I mean, even though he's a long-term value investor, he has nailed his short-term Chevron trade because he didn't own any Chevron until last year, start of 2022. He started buying aggressively. He's played this perfect spike, rally up in the oil price. And now he's been booking profit as the price of oils peaked and come back down. So he's nailed a short-term oil trade for what is the world's most long-term investor. He's caught the oil pop and now he's going to get the upside of the shale play. Well, so he's pivoted some of that money out of Chevron into Occidental Petroleum, who I think are more geared towards that shale play. And then, yeah, Kraft, Heinz, and then Moody's, and then, yeah, I won't go any further. So they're the kind of biggest. But yeah, Apple's at 50%. And the next biggest is only 8.6. So it's just Apple, then, in terms of tech. There's not any other Magnificent 7 in there. Well, not US tech. I'm just looking down the list here. He's got BYD, which is like the Chinese Tesla. Wow, that's a spicy one for the Oracle of Omaha. I'm looking down to beyond Amazon. He's got Amazon, but that makes up just 0.4% of his holding. Which is, by the way, I was just thinking, well, that's hardly any at all. It's basically negligible, right? But 0.4% holding, that is still $1.4 billion worth of Amazon shares that he owns. Just to distill it down as to why Apple and not these other tech firms or other companies, in terms of just broader exposure that he has. The simplest two points I could see, and this isn't looking at any financial metrics. This is more like strategic. One was durable competitive advantage as the most important quality a business can possess. That was number one. Number two was strong market presence in several consumer electronic verticals, just kind of where they're heading. That kind of underpins the Buffett rationale with Apple. Right. So I guess, even though it's one company, you could argue there's some diversification within Apple, the business. Obviously, you've got geographical diversification, but then you've also got product line diversification where you've got the hardware, which is the iPhone, but then you've got the App Store, which is your software side. Cool. Let's have a quick word then on politics. There's a promise at the top of the show. We'll keep this as brief as possible, just a couple of points to say. So one was, we touched on it, Home Secretary Suella Braverman has gone because of, as you said, the policing of a pro-Palestinian march from the streets of London. She made some unauthorized comments. I think it was in a Times article that saw her somewhat bumpy past come to an end in terms of the cabinet and she's already challenging the PM, what, two, three days later? Probably the biggest headline then, one perhaps you could just have a quick word on, is about bringing back the former Prime Minister David Cameron. Now my understanding is this has happened before in the past. They come back, but it's an infrequent thing. It's not very common. I did see some interesting photos of a very prime ministerial physicality that Cameron has shaking what I thought was the intern's hand, but no, it was our dear partner, Rishi. But that aside, which perhaps is going to be potentially one of the problems that Rishi might have to deal with. I guess there's a division there. Some people might see it as a sign of confidence that Rishi can bring someone like that in. Others might see it as in Cameron might steal the limelight. But what do you think? Well, I think that this is, we're in the end game because we've got an election next year, probably towards the end of the year, right? And the Conservative Party are big losers right now. And so you've got this end, the end game has begun and it's begun in two ways. Braverman, I think she fully intentionally basically got herself sacked intentionally so she could send a few bombs in terms of her much more right-wing opinions because I think ultimately she's gearing to be party leader when the Conservative Party are in opposition after losing the election to a more centrist Labour government. So the Conservatives have to pivot right and she wants to be the top of that. I think that's her play. Rishi, to counter it, has a, I think quite genius, brought in Cameron which grabbed all the headlines, right?  So actually from a media play point of view I think it was genius. It kind of trumped her. Then from a political thing. I mean, yeah, look, foreign secretary, obviously Cameron's got, he was Prime Minister for six years. So longer than that, wasn't it? I think it was six, wasn't it? 2010 through to then Brexit. Oops, I need to resign in 2016. Pretty sure. You might have to fact check that. But anyway, he's got relationships with world leaders. He's been out and about around the planet. And so I think he carries weight as a foreign secretary. So I think that's a good thing. Plus, finally, he's more centrist, right? So this is Rishi saying, look, if we're going to win this election, we need to go back to the centre where Labour are trying to steal our old ground and we need to not pander to the right-wing side of our party. So that's his play. So translating this into markets is there any short-term impact or is this more long-term potential implication? Yeah, for markets, I don't know what the impact is to be honest. I mean, I think some would argue that this is the last desperate move in what will ultimately be a failed attempt. So they all lose the election anyway. So we're left with a Labour government. Now, Labour governments, depends how centre they go to win this election, but normally Labour governments are bad for business because Labour like to historically like to tax more. So it's kind of business negative. But as I said, Starmer is definitely going more centre here to win the election. So it might be that, who knows, it's not negative, I don't know. But I think for markets at the moment, probably doesn't matter too much. I mean, I think the inflation situation is way more significant for markets right now. All election stuff, fine. It will brew up and become more interesting next year. Yeah. And then finally, we had Biden and Chinese counterpart Xi Jinping, they met this week, I think it was San Francisco, and they agreed to resume military communications. That's quite a significant thing, given what had been a fairly severe deterioration in that relationship. I think two things in the last 12 months, I think Xi Jinping was a bit of a lousy, your dear friend. She just kind of went totally against the grain and visited Taiwan, which China would not happy about in one bit. And then also, US accused China of sending those spy balloons. If you remember those getting shot down, that wasn't long ago, that was earlier this year. So Xi had been giving Biden the cold shoulder. I think Biden in June, and they were having a nice lunch yesterday in San Francisco. So the fact that they're having lunch, is that the takeaway here and just the fact that the, certainly military communication being reestablished, because I guess the tail risk of any major power confrontation is a miscommunication on that level, which would have dire consequence. And hopefully now they've not agreed really anything, but at least there's dialogue. This is a short-term positive. For sure, the fact that they're talking is definitely a step in the right direction and is a positive. And if you want to put it at a super, super top-top level, World War III risk has come down a touch because they've met up and they've had lunch. The reason I say it's short-term is back to the political cycle thing. Like in the UK, we're going to have an election next year, so are the US, right? And if DJT, Donald J. Trump, wins and rocks up back in the White House, well, then you could probably bet that maybe some of the positive ground that Biden makes up might be reversed. It depends on Trump's angle, to be honest, because I think from a trade point of view, Trump's very divisive and of course implemented the sanctions on China when he came into office last time round. Sanctions that Biden retained, I might add. So on a trade point of view, he can be divisive, but I do think from a war point of view, Trump's definitely on that camp of he doesn't want these forever wars going on where the US get involved in wars on the other side of the planet and he wants to pull back from all of that. He wouldn't be funding the Ukraine, like Biden's Democrats have. And so I think you could say from a military point of view, Trump might be a positive in terms of Chinese relations, but from a trade point of view, he'd probably be a negative. Indeed, do you think China are quite aware of their economic situation at the moment and also the scarring of COVID and a supply chain disruption which has led to big companies like Apple, for example, almost pivoting a large portion of strategy out and into areas like India, for example? Do you think China also need to be quite forthcoming here to ensure that, look, this is a long-term transition. This isn't going to happen immediately. We need this business because at this conference or the dinner in the evening, I understand Musk was there, Tim Cook was there, the head of Pfizer was there. You had BlackRock, Larry Fink, Blackstones, the private equity firm, CO was there. So every mover in shape. Power table. Right. On the Apple point, it's almost the opposite is happening. You would be right to say from China's point of view, hang on, our economy is weak. We should be doing everything we can to keep Apple happy because they obviously employ upwards of a million people or something crazy via Foxconn who's their main producer. But then there's regulatory issues afoot with Foxconn which people, the conspiracy theorists believe is to hamper Apple's ability to produce the iPhone so that therefore the Chinese domestic equivalent can come in and win back more market share. So that's going on. And Tim Cook kind of alluded to that in the earnings report whatever a month ago. So that's something. But yeah, I mean, look, I think that these big powers need to be talking. I don't think it's the case that China or the aggressor like the West think and look, they're sensible. They want a long-term strategy that's going to work for them and so yeah, let's get back to the table. I think it's more of that than anything else. Yeah, I think that's the point I wanted to make. I think I feel like being positioned in London and being of Western media, we tend to think it's the Chinese being quite problematic. But I think that this is a marriage that needs to work basically for both parties' sake. But okay, cool. Well, look, let's wrap it up there. What I have been doing on all of the recent episodes is dropping a poll on the Spotify podcast app which is a new feature. So if you've just listened to this, check that out. Leave what you think is the correct answer. Won't tell you what the question is yet because I haven't actually come up with it yet. We're not recording this, but there will be one and I just want to have a play with that feature. So yeah, give it a go. Let's see what happens. What did Elon Musk order for his main course at the Biden G lunch? I do know what he had. So apparently there's this new injection that you can have. There's a weight loss and it's meant for people who have type 2 diabetes. Yeah, yeah. That's what he has for dinner. I'm told. Sources. Cool. Thanks, Piers. Have a great weekend and thanks everyone. Catch you later.


And I think that's okay. Obviously, I'm the arbiter of what is good prose. Well, it's mostly famous for being unfinished, but that takes talent. Well, that one book had great prose. If you have watched my channel for a while, you're probably aware that I can be a bit of a prose snob. And I think that's okay. So I wanted to talk today about good prose, prose that is good for me, and some of the authors that I think of as great examples of at least the kind of prose that I like to see in books or books that I would specifically call out for having quality prose. So what is prose, as opposed to say grammar or syntax? Well, grammar is to prose, as structural integrity is to interior design. So like with structural integrity, there is little to no debate to be had over grammar and syntax and that kind of thing, whereas there's a great deal of debate and subjectivity when it comes to interior design or prose. In fact, grammar and structural integrity can both sometimes be undermined or ignored in service of design or prose. So since we just established that prose or good prose is as subjective as good interior design, I think we should talk about what I think is good prose. And I obviously am the arbiter of what is good prose. But in all seriousness, I think it's important to establish what one's tastes are and what one is looking for.   But somebody designed it that way. Somebody thinks that that is gorgeous. So I think prose is pretty similar in that respect. So again, back to me and what I think is good prose. I've come up with sort of like five overarching categories. Ways prose can be good and in a perfect royalty would hit all five. But like some combination of these things, these factors is what makes me go, ah, this prose, this prose is quite good. First step, lyrical. For me, the words should flow. They should sound good strung together. They should have a cadence, a rhythm. There should be beauty just in the shape and sound of them. Next, artful. So I think there should be cleverness to the choice of words. Tricks of meaning, subtle flourishes that add dimension, playing with expectations, wit, double meanings, things like that. Next I have lush. I think the good prose to me should be evocative. It should be filled with imagery and sensory detail. I like prose to employ a lot of metaphors to kind of form pictures out of words, to transport you to the experience that's being described. Next I have poignant. I like there to be phrases that sort of like resonate beyond the story that is being told where you can find greater, more widely applicable truths or wisdom, observations, reflections, things like that that's sort of like that it's poetry in and of itself even when taken out of the context of the story. You know, the quotable quote, the kind of thing that you put on a bookmark, on a t-shirt, on a poster. Even if someone has not read the book or the scene or the sentence in its entirety, just the quote by itself like holds some kind of like resonant truth or reflection that anyone looking at that can kind of go, oh, uh-huh, yeah, I get, I get what you're talking about. And lastly, I have verisimilitude. One of my favorite words. So verisimilitude really just means that like, you know, that you're faking it. You're faking it really well. It's like giving it the sense of being, oh, I'm finding it's really difficult to actually explain verisimilitude. So like, even if something isn't like historically accurate, for example, but verisimilitude is like that it does a good job of like feeling authentic if that makes sense. So I think that pros, effective pros, good pros is going to effectively like evoke the era or the style or the type of story that it is telling. So even if it's not perfectly imitating it because then, you know, that's not verisimilitude anymore. It's just replication, if that makes sense. So if you're telling a story that should be kind of like fairy tale-esque or is based on folklore, then you're not necessarily going to use the exact kind of language that you would actually find in a fairy tale or actually find in like an old English legend, but using pros that kind of evokes that vibe. So it feels kind of like it really is fairy tale-esque. Similarly, like again, with like historical fiction or historical fantasy, where again, maybe you're not actually using the language that would have been used in this time period or in the time period that is being evoked in this fantasy. So like, fantasy worlds are fantasy worlds, but if this fantasy world is like clearly based on like 1700s France, then like, okay, you're not writing in French and you're not writing in the actual language they would have used in the 1700s even in England, but it kind of like the formality of it, the terms of phrase, the kinds of words used, that it does a good job of evoking that vibe, even if it's not actually replicating that. So it should sound a little more formal, a little more old fashioned, a little wordy or things like that. By contrast, grim dark fantasy should probably sound less lyrical and should have more cutting and harsh prose that sounds more like what you'd imagine men of action employing, like the kinds of phrases and the kind of language and the kind of brevity that you'd expect from people that aren't academics, that aren't scholars, that aren't poets, that aren't the aristocracy. These are like so boots on the ground so they probably wouldn't speak in very flowery language. So then again, like this is where actually lyricism and beauty in the prose might actually be a detriment to the verisimilitude of the picture that you're painting. So now that we've established what I like in prose, let's talk about some of my favorite authors for prose. I think the first one that comes to mind for me and for many people is Patrick Rasmussen. The name of the wind I think is pretty famous for, well it's mostly famous for being unfinished, but Patrick Rasmussen's prose, that's a thing that people talk about, it's a thing that people know about, it's a thing that people remark on when they read the book. And many a negative review will say, I hated this book, the prose was beautiful, but I hated this book. Now of course there are certainly reviews that say I would have liked this book better if it wasn't so goddamn flowery. So again, your mileage may vary and your taste can be the exact opposite of mine in interior design. But Patrick Rasmussen is known for having this kind of like lyrical lush flowing prose. One of my most quoted quotes ever that it, cause it just like comes up a lot. So for being such a long quote, I'm kind of surprised by how many times I've had occasion to use it. I'll do it again. And that is loving something because is easy. That's like putting a penny in your pocket. But to love something despite, to know the flaws and love them too, that is rare and pure and perfect. So the name of the wind, it isn't necessarily written in a really archaic way. It's not that formal in its prose. So it's not doing that. It's not doing the thing of like trying to sound like Shakespeare, but it is still very kind of like evocative, filled with imagery, filled with kind of extra descriptions of sensory detail kind of thing. So you're transported sort of like to the place, the time, the smells, the sounds of what the character is experiencing. Next on my list is an author that when I first picked up the book, my first reaction was like, not since name of the wind, have I seen words like this? And that is Laini Taylor. And fittingly enough, Patrick Rothfuss blurbed a Laini Taylor book saying, wow, I wish I had written this book. So I feel vindicated in my reaction to Strange the Dreamer and going, wow, this is like name of the wind. So Laini Taylor is more flowery even than Rothfuss, I would say, with even more sensory detail, even more kind of metaphorical imagery than Patrick Rothfuss uses, more fantastical things that is also because the stories that she tells are more fantastical. There is magic in the name of the wind and the circular chronicle, but it isn't as like whimsical as Laini Taylor's magic. Laini Taylor has like lots of fanciful things happening where like inhuman things, flying things, you know, all kinds of magics and color and different places and things. And it's just like a lot more lush with like stuff going on. So there's just a lot more occasion to be describing things that are fantastical, which just like adds a layer of whimsy to the already fairly whimsical prose. But I think one of the most famous quotes from Strange the Dreamer, I think it was probably on the ARC covers was that, it was impossible of course, but when did that ever stop any dreamer from dreaming? Now again, a lot of people who don't like Laini Taylor's books would probably cite her prose as one of the main reasons, not necessarily the only reason, not necessarily even the reason, but I'm saying it's very possible to dislike it for the prose because it is whimsical, it is flowery, it is filled with imagery and metaphor and some people find that super annoying. Next, I have Neil Gaiman. I think Neil Gaiman, along with one other person on this list, I think the prose is not necessarily something that gets called out. And I think that's a shame because I think Neil Gaiman's prose is one of the many, many reasons that he is my favorite author. I'm not necessarily loving every story that I'm reading from him, but I'm always loving the prose. I think that there's a lot of art to his brevity. A lot of the types of prose that I've described that I like, you know, the flowery imagery-filled, metaphor-filled kind of prose tends to be more verbose. Doesn't have to be, though. Neil Gaiman is a great example of somebody that does employ imagery, does employ evocative sensory detail, but he's really concise. He's really to the point. He chooses his metaphors with surgical precision and it's a thing of majesty to behold. When I'm reading Gaiman, I'm just sort of in a constant state of awe at his ability to just choose the right words to tell this story. And he can tell you the story in like five words and that combination of five words is just like chef's kiss. So I think next time you're reading Gaiman, and I hope you do read more Gaiman, and if you've read everything he's written, well then read it again. Pay attention to the prose because he makes it look easy. You know, I think that's another reason people don't observe it because when you're reading something that's filled with imagery, you kind of notice it. It sometimes takes people out of the story that might be why people don't like that kind of prose. If I like the prose, I don't really mind noticing it. But with Neil Gaiman, it just kind of flows and it's very efficient. So you don't even really have time to stop and think about it unless you're kind of paying attention to it on purpose, like me, where you're just kind of going like, how did he do that way? Let me go back and reread that because like, how did he do that? Pay attention to his prose. There's a reason he is the legend that he is. Next, I have one that I definitely know people dislike for the prose, but this is one of the main reasons I love Maggie Stevar. Her books are even more whimsical than Lenny Taylor's in as pertains to the prose. The story is, I think, I don't know, you could debate that, which is more of a whimsical story. But the prose itself is extremely kind of whimsical and filled with imagery and metaphor. And I certainly talk to people who read Maggie Stevar's writing and are like, what is she talking about? What does that even mean? That doesn't mean anything. That's nonsense. And for me, when I read that, I think she's so clever at evoking the feeling of something, even if like the way she's just phrased something like doesn't actually make any sense or can't be possible or can't be true. But it still conveys an idea. It conveys a feeling. It conveys a situation. I realize I should probably offer you an example of what I mean with Maggie Stevar's writing. So on the fly, I found this quote, not a perfect example of what I'm talking about, but it should serve. As the hours crept by, the afternoon sunlight bleached all the books on the shelves to pale gilded versions of themselves and warmed the paper and ink inside the covers so that the smell of unread words hung in the air. The smell of unread words, like, isn't a thing. And yet, like that sentence, that passage is extremely evocative of the vibe of the room, the vibe of this moment. So that's what I love about her writing. But it's perfectly valid to read that and go, that doesn't mean anything. That's not a thing. That's not a smell. So I get it, if that bothers you, but that's what I love about it. And if you don't like Maggie Stevar, then you definitely, definitely should not ever read the next author on my list, which is The Head of Mafia. People make fun of Shatter Me for good reason. When I first started reading Shatter Me, I thought I hated it, which is to say, I guess I did hate it. Because it is excessively flowery and metaphorical and intense about all that. And so when I first started reading it, I was like, this is ridiculous. The more I read it, the more I fell in love with the poetry of it. And the more impressed I was with the genuine poetry of The Head of Mafia's writing. The series itself, it's kind of corny. It's got like, you know, it's a love story dystopian YA thing. Not the greatest story I've ever read. But her prose, I think, does contain genuine poetry. It is not easy to do what The Head of Mafia is doing. And again, you don't have to like it, but it does require a great deal of talent to do what she's doing. So I came to actually really, really appreciate what she's doing and enjoy it, like sort of on its own terms. And yeah, just kind of admire what she's doing with language because it is extremely artful. But I repeat, if flowering is bothers you even a little bit, never ever read The Head of Mafia's writing. Next I have Jean Wolfe. Now I've only read Book of the New Sun and Earth of the New Sun. I haven't read his other books. So as I understand it, his prose in other works is quite different from the prose and Book of the New Sun, which is quite formal and archaic and filled with a lot of unfamiliar words for a reason. But nonetheless, I think that the prose and Book of the New Sun is really stand out. It's really stellar, it's really beautiful. And there are definitely like, when I said there should be sort of poignancy, sort of universal truths, passages that you could tease out of their context and just admire for themselves. I think Book of the New Sun is filled with stuff like that. I think Jean Wolfe is a wordsmith and that art is on display in Book of the New Sun. And then of course the incorporation of archaic words is also impressive kind of in itself and he uses them so naturally. So yeah, I definitely think that the prose, irrespective of the story or the contents in Book of the New Sun is gorgeous. Next is the other author who I think their prose is overlooked. And that is Joe Abercrombie. Here, it's kind of similar to Neil Gaiman in the sense of it's quite concise and to the point it's not extremely verbose. It's not very flowery.  It's like the opposite of something Leonie Shiller would write. Nevertheless, it takes a lot of skill to do what Abercrombie does. And again, I would employ this theme sort of description of surgical precision in choosing the right word, the right turn of phrase. And the various similitude here is partly the sort of like this is men of violence. So the phrasing should be kind of quick and to the point and as harsh and efficient as the lives that they are leading. But it's also his ability to find the different voices of his characters. And so then not just write what generally this world would feel like but how the world would feel for each character and how they would express that. And again, I think that people talk about his character voice being really strong and it certainly is. But part of the reason for that is that he is such a master wordsmith and he is able to employ language to serve his needs with such mastery.  And he makes it look easy, which is why I think people don't remark on it because it just flows, it's efficient. It's comparatively simple in structure. But again, it's deceptive in its simplicity because to put things that concisely and effectively and efficiently in a way that gets you transported to this place, to this time, to these characters, to this vibe, that takes talent. But back on the flowery end of things. The next one I owe Donna Tartt. This is true in both of the books that I've read by her but more true I think in the Secret History than in the Goldfinch. When I was reading the Secret History I remember just kind of marinating in like the velvety lush decadence of her prose. And I think the story wouldn't work half so well as it does if it wasn't for her prose. Now, this again is one of those situations where the prose is extremely appropriate for the story being told. The book is about really pretentious academics who are up their own asses about their academia to their detriment, to their demise. And so there is like a pretension to the verbose nature of the prose which is exactly suited to the type of characters that she's writing about and whose perspective she's writing from. And so in addition to just being gorgeous and poetic in and itself it also transports you to the mindset of the characters that she's writing about. And here again, like it's filled with sensory detail. So in addition to transporting you to their mindset in terms of, I guess it's just the pretension of it it also again, transports you to like the moment the sights, the sounds, the smells, the feelings that are being felt by the characters in any given situation in that book. Next up I have an author more I can again to like to head a mafie or Maggie Stevewater and that is Catherine and Belente. I have only read one book by her, is that true? I own more books by her but I think I've only read the one. Well, that one book had great prose. That one book being deathless. And here this is blending folklore with history. And I think she does it, it is through her strange wild metaphorical lyrical prose that she's able to pull off this seamless blending of history and mythology in a way that feels true in a weird way. It's about utterly fantastical things and the line is so blurred between what is real and what is fantastical. And the prose is what allows that to be possible. Again, if this kind of prose annoys you, it never read deathless. But if the kind of prose I'm describing appeals to you, then I highly recommend deathless. On a slightly less insane note, a similar author in terms of prose that evokes the mythical, I think is Catherine Arden who wrote The Winter Night Trilogy. The Winter Night Trilogy does a good job of evoking Russian folklore and fairy tale. Catherine Belente kind of takes that one step further and it's totally wild in terms of the fairy tale-ness of it all and it's a bit chaotic because of this blurring of lines. There isn't really so much a blurring of lines in Catherine Arden's book. Thus the whole thing just kind of feels cohesively like its own fairy tale. And it does, it effectively feels, this is again where Varys and Militude comes into it. Like she's not actually writing in Russian and she's not actually writing in like, even like historical English. But it does have this kind of like formal yet whimsical quality to it with a lot of transliterated Russian words that effectively evokes this feeling of I'm reading an old Russian story. And again, that's, it's not imitation, it's not reproduction of that exact thing. I mean, we'd have to be reading it in old Russian. So I think she does an effective job of giving you this vibe convincingly. On a similar note, Madeline Miller who wrote Song of Achilles and Cersei. Again, she's retelling the stories of Paul from Greek Myth. We would have to read it in actual ancient Greek for it to feel authentic, but she is kind of stripping away some of the myth in the first place. So she's making it sound a little bit less mythic than a myth would, because she kind of wants to tell a story about like, well, okay, well, let's think of these characters more as three-dimensional humans, not purely mythical figures. They are figures from myth and to be able to go along with a story like that has to be told in somewhat a mythic quality so you can kind of go with it when it comes to them doing or experiencing or being around things that are fantastical and mythical. So I think she straddles that line quite effectively through the prose, through making it sound like a myth while also telling it like, slightly less mythical than a myth so that you can take seriously these characters as sort of more three-dimensional, almost like historical fiction characters, straddling the line again. And last but not least is J.M. Berry. And I think he does kind of all the things that I've been talking about. If you read the original Peter Pan, there's amazing turns of phrase and moments of poignancy that can be stripped from their context and you know, put it on a poster, wow, that's a universal truth there, sir. It feels like a fairy tale, but it also feels insanely true. Part of the historicalness of it is it may have been contemporary for his time so he really is just like writing of his own time so he can't really take credit for that. However, his pirate character, Captain Hook, is speaking from an even older time and so he's able to sort of like convey that this is this sort of timeless ancient pirate from yet further bygone era through the way that Captain Hook speaks. So I think that's done very effectively and subtly.  Even though Peter Pan, I mean, it's kind of become a myth now when he wrote it, it wasn't one. So I think the reason that it's become one to us is partly because of his ability to write a story in a way that feels like it is a myth even though he's inventing it himself. So yeah, those are some of my favorite authors for prose. Let me know in the comments down below your favorite authors for prose. If you hate all the authors that are just listed, if you like the authors that are listed despite their prose, if you think there's some better examples for amazing prose, whatever you let me know, I post videos on Saturdays, other random times as well, but I'll take Saturdays so I can subscribe for my Patreon if you feel so inclined and I'll see you when I see you.


We all pay the price for this. We pay for it in incarceration costs. It costs seven times as much to incarcerate someone as it does to treat that person. We pay for it with our taxes. We pay for it in an economy that doesn't have those consumers. We pay for it in an economy that doesn't have those people working in good productive jobs. We pay for it in families that are broken up. If you happen to be lucky enough to be personally unaffected by this, you're in, I think, a smaller and smaller group in Pennsylvania, but even you are affected by this by what this means for our society.


Welcome to Suncoast Spotlight. I'm your host, Jeannie Corcoran, and you're watching a show partnered with the Suncoast Technical College Digital Filmmaking Department and the Education Channel. Today's guest is producer H. Michael Hoyser, who is also the President and CEO of Storm Entertainment. Michael has been the executive producer of 90 films, and his company has arranged financing and distribution of over 160 films. And now, let's learn more. Welcome, Michael. Thank you very much. It's good to be here. Thank you for being with me. I know that you are probably tired of me asking you questions. I've made him my interview subject in numerous venues, and you're going to be a featured speaker for us, a VIP speaker at our annual Six Animix event. Thanks for the honor. Oh, it's great. And I don't know where to start with you because you've done so much. Michael has not only done everything I mentioned in the intro, but he is also a world traveler. He speaks five languages. More or less, yeah. More or less. And he has been with notable companies. He has started notable companies. And most of all, one of the reasons that we have you here is because you're recognized for extraordinary financing and distribution of a massive amount of movies, major movies. Yes, I have. Absolutely. And so diverse. Everything from Heidi, never-ending story, Pritzi's honor. I mean, it just goes, the list goes on and on. Do your dancing. Yes. Don't forget that one. Yes. And I am amazed at the diversity of the genres. Have there been any genres that you think pay better? I mean, you're very focused on ROI for investors. I am. ROI is critical, obviously, because you want to go back to the same investor over and over again. Ideally, the same bank, the same institutional equity player, hedge fund, et cetera. But there is no genre in particular that works better than others. It depends on the climate of the time. So it changes from year to year. So a great Western that might work in 2007 might not work in 2017. That's absolutely right. And you have to count ahead because your movie will be distributed and ready a year, year and a half, two years, three years down the road. So you have to think ahead. And sometimes you're off and sometimes... But you always pre-sell the rights to the movie in different territories and the United States. So you pretty much hedge your bets ahead of time. Right. We have a lot of independent filmmakers in Sarasota County and the whole Tampa Bay region. And they make a lot of short films. They make a lot of sizzles and trailers and things of that nature. What advice would you give them when they're creating and investing their own money, usually, to make a demo or to make a short? What would you tell them to have vision about where it's going to go eventually and what's the purpose of doing it? Well, the purpose of doing it, if you do it at all, if you can afford it because it's very expensive, is to basically to say that I have talent, number one, because a lot of people, unfortunately, don't and should be doing something else. But that's okay. But it could be within the same industry, but something else. And it's really a question of proving that you can do it, number one, and number two, that the market can bear it, that there are buyers. It's not a labor of love, which you can do if you're, you know... Independently wealthy? Independently wealthy, basically. Or if you have people that want to write off or whatever the case may be.  So you have to invest yourself as well as... Absolutely. That's really important. And we have, we've seen probably almost 3,000 projects of some sort or another in the 10 years that our film commission's been on the ground in Sarasota County. And I have to tell you, of those 3,000 that we've seen and we've helped and we've talked to, they've run the gamut from no money whatsoever to, for the indie films, maybe two million dollars and under. We don't get big indie films that have 15 million, 20 million dollar budgets. But even the small indie films that have been $50,000, and I'm serious about that. Sure. It's remarkable that you can do that. And the average ones tend to be in that $100,000 to $250,000 range. The similarities are striking, no matter how little that indie budget is or how big that indie budget is. They all seem to face the same kind of problems, which are, first of all, getting it funded, finding the money. And then secondly, finding the outlet, getting it distributed. Well, it's a very hard, they're very hard parameters really to distribute a movie that costs, unless it's Blair, which project, which version? One of a kind. One of a kind in a long ladder of films. But it's really, they are usually layers of love, to be honest, because it's really hard to find distribution. And it's after the fact. Unless you're a moonlight, and moonlight was probably not sold beforehand. It was just some really independent people that could piece together a million and a half dollars, which is a lot regardless. And I'm sure the actors were not paid that much, and the director was not paid that much, and people were just not paid. It was more of a labor of love. In the hopes that it would. In the hopes that it would, and it did. And ironically, for those of you who have seen Moonlight, our Academy Award winner for best film, two Sarasotans contributed to the making of that. One was a Pineview graduate from Pineview High School. And then one of the producers was Elaine Schneiderman from Venice. And we're just so proud of him. That's so great. Good for you. Yeah, we'd love to see Oscar winners. It's a start. From our area. Absolutely. Now they just have to bring, you know, bring some projects back here. Bring them home. Good, good. Well, that's certainly my agenda. Yes, well, and we appreciate that. Well, I'm here. Absolutely. We'll talk in the second segment, we'll talk more about infrastructure and what's coming in Sarasota County and how you think that might affect television production as well as indie film production. But you do have an upcoming project you're working on right now with some amazing people. Before we go to break, tell me a little bit about that as a teaser, so everyone will stay with us. Well, it's a project that I'm going to produce together with Emma Thompson who needs so introduction. Fabulous woman. And George Pelicanos is a writer for Script TV. A lot of Spielberg work? Spielberg work as well. And he wrote The Wire and created The Wire, which is all over the place, or it was all over the place. And Tremé, which is now on Showtime, in addition to a lot of Spielberg work. Well, if they come to visit you in Sarasota, I want you to be sure that we get to meet them here. Absolutely, and they'll be sitting right here and they'll be another subject of your interviews. So that's what I'm doing. It's based on a true story, first-time director, so it's a little bit hard to raise the funding because people are really sophisticated, both domestically, which, and by the way, domestic, which means America and North America or Canada, only represents 20 or 25 percent of the total cost of a budget. So the rest of the money, 75 percent, let's say, comes from overseas, from China, from Japan, from, you know, from the UK, from Germany, from the top ten territories. Well, hold that thought and when we come back, we'll talk some more about distribution, as well as young struggling filmmakers of all ages, by young, I mean young in their careers, how they get to where they want to be. Stay with us, we'll be right back. You're watching Suncoe Spotlight and our guest today is H. Michael Hoyser. I'm just going to call him Michael. I don't think anybody from H. do this. Absolutely. No, not at all. Only the IRS does. And we're talking about many, many films and how they get financed and how they get distributed, which is the bottom line after all. If you can't get the money to make it, and then after you get the money, you can't get a distributor, why are you doing this? I'm very interested in, we touched briefly in passing on the Blair Witch, which was sort of a genre creator. It was new. It was very new. And that doesn't happen very often. And the great lie, I think, that is out there in the general public is, ooh, they made Blair Witch for $30,000 on their credit cards. But they didn't, Mirror Max or whoever bought it, they put a million dollars Yes, they did, but still. And a million dollars to better the movie. They hadn't make it better. Basically more commercial and editing and the music and sound, of course, production design, et cetera, which is all in the woods, of course. But there was a million dollars there and a million dollars in marketing and P&A, what they call P&A. That's right, exactly. I forget sometimes to associate the full name with exactly. Which is a whole different area of expertise, if you will. And that's what I'm trying to get into as well. We see a lot of indie films made for very little money. And a lot of times they'll use a Blair Witch or something like that as their justification for, I'm making this for $15,000 on this camera that I bought at Best Buy. I think everybody will. And then they're surprised when they can't even get Netflix because it doesn't have audio. It doesn't have proper dialogue you can't get. Not only that, but Netflix, for instance, is really making their own stuff right now. So they don't really need you or me anymore or locations or anything like that. They're making their own stuff and very well, too. Would you say, in fact, Cable and some of the OTTs, they are making some amazing quality series that rival the quality of... They certainly are. The question is how long can they do that because they're not generating a lot of income right now? But in the future, perhaps they will. Maybe the income will come from either the box rights. I see them sold as box. No, it'll be a combination of rights that they have to license, starting with theater, which is really important when you go to AMC's or Regals or whatever or independent theaters. We do, too. Everybody does, too. And that generates a certain amount of income. And then there's a whole plethora, if you will, of how to exploit that particular movie and Windows and all that kind of stuff. And that's really how you make your money. And then there's International, which is basically it's very sophisticated, the same structure, if you will, as the United States. Netflix, for instance, has a life elsewhere, not only the US. And now we're seeing the same model. What's succeeded with Netflix has now been picked up by Hulu and it's being picked up by Amazon and it's being picked up by Google. Google and Amazon in particular. And then every territory has their own, the equivalent of Netflix. So it's like Uber going into Paris, that they're really not allowed to go into there. So Netflix has the same issues and they're not doing as well as they would like to do. And they will, they will, because they're really smart people. I was very surprised. Netflix, I believe they partnered with Sony to make the TV series, Bloodline, Sissy Spacek. That's a wonderful series. Oh, and we had a great opportunity here in Sarasota County. They came, they scouted with us. They saw things they liked. But in the end, it was written for Key West. And even though Sarasota is fantastically beautiful and we have many assets, we just couldn't fake Key West entirely. There's a lot of old Florida here, though, which is really just beautiful stuff. And that's really attracted me to the area in particular.  And then, of course, the state of Florida pulls the plug on its incentive program where we have no more tax credits. And that was the way of all flesh. Now, we've lost, we've lost Bloodline. We've lost Bollars. Oh, is that right? And Bollars, in particular, which is filmed in Miami. Yeah. So you've lost them. I think they shot two seasons each, maybe three in Bloodline. And then, boom, they're gone because it's an incentives game. How does the incentives game affect what you do for financing? It affects quite a bit, actually, because for every dollar, you get X amount of rebase, if you will, like 20% or 25% or 30% and it creates a lot of jobs. And so if your budget is 20 million, basically you're going to get a budget of 30 million or on the screen, if you will. And that's pretty valuable. For a financier, number one, and for the country or the state, it's really, it's imperative. So I really don't understand why Florida is pulling or why they have, to be honest, because there's a lot of jobs that are being created, number one, and a lot of income is being spent here in hotels or bars or wherever the case may be. So I think with a different, perhaps a different administration, that'll change. We'll see. We'll see. Exactly. It's so interesting because there's, you know, there's a lot of dialogue about the states that surround Georgia, and Georgia's really the power hub right now for incentives. They're doing gangbusters. I mean, it's a multi-gallery. Well, they certainly are. Like, a lot of people are going to Louisiana and, you know, Michigan, for instance. Anyway, so hopefully Florida will be part of that list again. And it's very interesting to hear from the public at large who ask about incentives when we talk about it, because of course, there's always the conspiracy theories and, you know, where there's, where there's smoke, there's usually a little fire. Sure. But they talk about the people who donate to legislators who vote against incentives in the state. And when you trace that back to where the money comes from, always follow the money, they say, that some of the money coming into political campaigns and political donations is coming from outside states that want us to fail in certain industries. So they, they, so they can compete. So they, they take away our competitiveness, and they take it away through supporting elected officials that will. That's very interesting. I haven't, I haven't thought about that. Yeah. I hope it's not. But it's very political and it makes a lot of sense to. I hope it's not. Yeah, I do, too.  No, it's not.  It takes time to recuperate. Absolutely. Kind of like stopping a train that's going uphill. Sure. Decide to restart it. It's going to take a long time just to get the momentum. Yeah. It's a good analogy. Absolutely good. Well, I think we're taking another break. This is going way too quickly. Stay with us. Yeah, it really is. Has electricity ever sparked your interest? If so, at STC, we have the perfect program for you. Let's take a look. We are training the electricians for this area for the future. What you can learn here is safety primarily when dealing with electricity, but also advanced wiring methods, also motor control circuits. This program is very interesting. It's, it'll help you in life because everyone wants electricity. So either if you're doing residential commercial, all these courses in one class was very demanding. It's very helpful in life in the long run. Be prepared to do some more advanced math than in some of the other trades, but nothing too daunting. I think that we have a lot of fun. We work with our hands a lot, so be prepared to do some physical work. But usually it's pretty enjoyable. A lot of stuff is outdoors and we spend a lot of time in the lab. The classes, it seems intimidating, but don't be intimidated. Just stay focused. And this is, this is something you really want to do in life. I'd just, if you work hard, you'll get through it. Nothing to be really afraid of because that's what I was intimidated when I first came in. So it's, but it's all good now. It's a great trade to learn not only for, for an actual job, but for owning a house or anything, even if you choose a path that's residential or commercial. There's maintenance you can go to, the paths that are very broad for this trade exactly. And I think it's a good trade to get into. Reporting from STC, I'm Courtney Callan and this is Suncoast News. Welcome back. You're watching Suncoast Spotlight and I'm your host Jeannie Corcoran. And thank you very much Suncoast Technical College and the Education Channel and the Digital Filmmaking Department here at the college. And we're talking to H. Michael Hoyser and he has insight, experience, and a squeaky table. And tell me a little bit, Michael, about how you see the future of financing and distributing. If it's changing, we've been talking about like Netflix models, and then there are new screens, small screens. People are watching things on their phone. They're watching things on their watch, watching things on gas pumps that now have screens. Yeah, I've noticed that as well. It's always a question of the cost of a movie is relatively consistent. So it's a question of finding how you recoup that specific amount of money, whether it's a million dollars or 100,000 or 10 million or 100 million. But it's always the same players, if you will. And it's just a question of how do you recoup 10 million plus an ROI, which is never guaranteed. But so how do you do that? And if there's more ways or more platforms that you have access to, all the better. As long as the other ones don't go away. And we talked yesterday in an offline conversation about where people get money. And you had some interesting insight about not getting it from friends and family and loved ones. Don't go to grandma. Don't go to cousin Bertha. Absolutely. Not unless you can afford it. And frankly, it'll affect your relationship with people. And so you use banks, you use hedge funds, you use institutional equity, but you always want to go back to those same players, if you will. You want to make the money, as opposed to hit and run, because after a while, you're going to not be able to do that. The well will run dry with those. And those who love you won't love you anymore. That's right. They always love you when you're making money. That's right. I remember back some years ago, Robert Townsend was making films on his credit cards. And indie filmmakers were all about, let's just grab a credit card, a couple credit cards that have 10,000, 20,000-hour credit lines, and let's just go do it. Yeah. And then what? Then what, exactly. And it's a question of really selling the movie beforehand, so the ability to sell it and to market it beforehand, or while you're doing it. And that's oftentimes what happens overseas, if you will, because overseas, again, represents 75% of your income, whereas the US represents the difference, the balance. And it's a question of selling your movie and convincing people that this movie is going to make money for them and for you, obviously, but you're secondary for them. And do you look for a formula when someone brings you a movie and they want you to get behind it and help with finance and distribution? Does it have to have X, Y, and Z? Like it has to have a recognizable celebrity. It has to have a recognizable director. Or what, are there some key components that you look for before you get involved? No, you really don't. But it's really important that they do have those elements, if you will. But you can't insist upon them or that. And you take every project as a stance, and it really starts with the director and the story, to be honest. Oh good. So you do look at the art and you look at the core of the content. Very much so. Because to make it interesting. Right. And again, I'm not in the budget business, even though I've been at it for a long time. But every project is very special, and you think that every project is going to make money. And you hope you find a midnight. Yeah, and then every once in a while, there's a movie that breaks out for you, absolutely. We have a friend of the film office, and she's come down to speak at the event that you'll be speaking at. Six in a Mix, and her name is Celine Rattray. And she is partners with Trudy Styler in a women's film company up in New York City. Wonderful. And they do projects of the heart. They find things that just appeal to them as human beings. And that's kind of their motivation. They're always looking for that, like you're saying, that special script, that special story that strikes a chord. Whether it's comedic or dramatic. You're absolutely right, but everybody's competing for the same piece of the pie, so it's very difficult sometimes. But Trudy will have a reputation, so people will send a project to her first, let's say. Yeah, because they've won Academy Awards now with Steel Alice, and the kids are all right. And this kind of project goes to them. Basically, if they like it, and then after that, it goes to a number of other players. So you strive to get that first strike position. Exactly. You want that first draft pick. Yeah, absolutely. Absolutely. You're very fortunate. But that also affects the income as well. Do you see yourself leaning more towards the possibility of TV movies made for television films, or limited-run series where it's like six episodes? Well, it's not really my forte, to be honest. And I think that you need a full career to really benefit from that. Whereas what I do is feature films, and then they translate into every other medium out there. But they start with feature films, and they start with the theaters, ideally. If you can achieve that, then you're well on your way. And you said there's one genre, generally, that you're not really interested in. And that's horror. And there's a lot of people that are better than I am, and they love it, and they can do better than I can. And frankly, if I'm in a dark theater, and I'm looking at horror, my eyes are closed 90% of the time. That's me, too. And there are people that really thrive on that. But I don't. I'm not one of them. I saw John Wick 2 recently on Valentine's Day, ladies. On Valentine's Day, my husband took me to see John Wick 2. Well, apparently it's really good, too. It was awesome. It was very, very violent. But after a while, there was so much violence.  It felt like a video game. Interesting. By the end of the movie, I was thinking, gosh, this is going to make a heck of a video game. It doesn't want to. Yeah, well, it probably has already. Yeah. Yeah. But again, that kind of movie I can do, it's the horror, the slasher, monster. The blood coming out of you. Yeah, coming out of behind the door, that kind of things. You know, I just, I prefer not to do that. Well, good. I'm glad. There's enough of that out there that we need people who are doing other things. And there are some people that are really, really good at it. And that's all they do, and good for them. Well, and I'm not sure, but I think we're going to be wrapping it up here very soon. And I want to thank you so much for being with us. You are, as always, terrific. You're so knowledgeable. I could ask you questions all day long until you wanted to, you know, run screaming from the room. Well, it's a real honor for me, to be honest, you know, and to move really to Sarasota from Los Angeles and spend a lot of time here really means something to me in particular. And the last thing I want to close with is Ringling College and Semcorre Productions out of New York. They're building a 40,000 square foot soundstage studio facility. And that kind of infrastructure, they're particularly looking to attract television, but also indie film and so forth. As a financier, distributor, producer, how attractive do you see that kind of infrastructure being added to the area? I think it's got to be complemented with what the state can offer. So we need to get the state back on track? I think so. I mean... Do you hear that, Tallahassee? We need to get the state back on track. Absolutely. I would think so, that that makes a lot more sense than just having somebody come and, you know, why here as opposed to, especially if it's a set design or a studio, you know, why here as opposed to North Carolina or, you know, Louisiana or... Or universal in Orlando.  Okay, that's food for thought. And that's going to wrap us up. We're all done and thank you for watching Suncoast Spotlight. Tune in next time. Thank you so much. I really appreciate it. Thank you very much. My pleasure.