Ben Turns 40 (EP.218)

Episode Summary

Executive Summary: This episode ranges from IPO and direct-listing performance to the resilience of markets, the rise of speculative assets like NFTs and crypto, and the reality of inflation, labor, and supply-chain bottlenecks. The hosts emphasize that crises are easier to identify than bubbles, note that low rates and stimulus may push some investors toward risk, and argue that context matters more than headline inflation scares. They also touch on personal milestones, home-appliance shortages, housing trends, and media recommendations.

Main Topics: Direct listings and IPO performance (Priority: 5/5): The episode opens with YCharts research on direct listings, showing that many debut-day returns are weak, while some stocks gain meaningfully in the first five days. The hosts use Robinhood, Spotify, Squarespace, and Blue Apron to illustrate how timing and structure affect outcomes. Crisis investing vs. bubble-chasing (Priority: 5/5): Dan Rasmussen’s successful crisis fund is highlighted as proof that surviving and exploiting crisis periods can be more productive than endlessly trying to define bubbles. The hosts contrast rational crisis-focused investing with perma-bear narratives. Rates, risk-taking, and fixed income demand (Priority: 4/5): The discussion explores whether low rates are pushing investors out on the risk curve, while noting that demand for fixed income remains enormous. They argue multiple investor life cycles can produce both risk-seeking and bond-buying at once. NFTs, crypto speculation, and market infrastructure (Priority: 5/5): NFT activity is described as roaring back, especially around Bored Apes and Pudgy Penguins, with OpenSea volumes surging. The hosts view NFTs as a sign of abundant crypto wealth and discuss tokenized assets, fractional ownership, and the future of 24/7 markets. Inflation, labor, and supply-chain bottlenecks (Priority: 5/5): They debate whether current inflation is temporary or sticky, citing James Montier’s view that sustained inflation requires wage growth to outpace productivity. Examples like lumber, used cars, and appliance shortages are used to show how fast supply constraints can reverse. Life-cycle, aging, and family stress (Priority: 3/5): A long personal conversation covers Ben turning 40, changing attitudes toward birthdays, hangovers, parenthood, and how stress shifts from self-focused career/dating concerns to children and family responsibility. Media, culture, and recommendations (Priority: 2/5): The hosts discuss White Lotus, CODA, Trying, Val, and a Lego Seinfeld apartment set. The theme is satisfaction with well-made, emotionally resonant, or cathartic entertainment.

Key Arguments: Direct listings often do not produce a big day-one pop because existing holders sell immediately, but returns can improve over the first several trading days. Crisis periods are easier to identify than bubbles, so investors should focus on surviving crises rather than endlessly guessing the next bubble. Low interest rates may encourage more risk-taking, but that does not mean the bond market has no demand; different investor cohorts behave differently. NFT mania may look silly, but it reflects substantial crypto wealth searching for new uses and communities. Inflation is not simple to diagnose: money supply growth does not automatically translate into persistent inflation without wage/price feedback loops. Many recent price spikes appear tied to supply bottlenecks that can reverse quickly, as seen in lumber and appliances. The housing and labor markets are still distorted by supply shortages even as some indicators, like mortgage applications, cool off. Adult life changes the nature of stress: less about self-image and more about children, health, and family outcomes.

Data Points: Direct-listed IPO first-day returns: Most were down; only Spotify and Squarespace posted notable gains, around 12% and 15% - YCharts research cited at the top of the episode Direct-listed IPO first five days: Robinhood up 46%; Squarespace up 26%; Roblox and Spotify up double digits - The hosts note that performance improves over several days after listing Blue Apron since IPO: Down 95% - Used as a striking long-term underperformer Dan Rasmussen crisis fund return: 85% net of fees - Verdad Capital fund raised during the crisis Capital raised by Dan Rasmussen: $150 million - Raised during the crisis period Perma-bear quote on markets: N/A - A newsletter excerpt warning against buy-and-hold and index funds State Street ETF flows, fixed income: $124 billion year-to-date - Used to show continued demand for bonds State Street ETF flows, equities: $391 billion year-to-date - Compared with fixed income flows NFT top 15 projects sales: $100 million - NFT sales accelerated sharply during the week OpenSea volume on June 1: $3.6 million - Illustrates rapid growth in NFT trading activity OpenSea volume on Aug. 8: $71 million - Shows the surge in NFT volumes OpenSea NFT buyers: 109,000 people - Packy McCormick-related discussion showing relatively small user base FTX valuation growth: $0 to $18 billion in under 3 years - Profile of Sam Bankman-Fried and FTX FTX company age: 26 months old - Emphasizes how fast the company scaled FTX market cap per employee: $219 million per person - Compared with Facebook's per-employee value Facebook market cap per employee: $17 million per person - Used as a contrast to FTX Spotify revenue growth: 23% year over year; 9% quarter over quarter - From Spotify earnings discussion Spotify multi-active users: 365 million, up 22% year over year - But below guidance Child tax credit amount: $250 to $300 per child monthly - Payments to eligible families beginning July 15 Eligible families receiving child tax credit: About 35 million - Surveyed before and after payments Lumber price decline: Down roughly 70% to 75% - Example of a fast-reversing supply shock College tuition and fees increase: 0.2% year over year - Suggested as a disinflationary data point U.S. jobs gap vs. pre-pandemic: About 6 million fewer jobs - Despite similar or higher output levels Zillow stock decline: Down 55% - Referenced as an example of a falling stock in a strong market Spotify stock decline from high: Down 48% - Despite strong underlying revenue growth

Pivotal Quotes: "I have just given up trying to define what a bubble is, but when I'm in a crisis, everyone knows they're in a crisis." — Dan Rasmussen: Used to frame crisis investing as more actionable than bubble prediction "Hope is not a strategy, Ben." — Unnamed perma-bear excerpt: A newsletter quote criticizing buy-and-hold/index investing "The Fed was trying to get inflation higher for 11 years and couldn't do it." — Michael Batnick: Part of the discussion arguing inflation is more complicated than simplistic money-printing narratives

Implications: Investors should be cautious about simplistic bubble or inflation narratives and pay attention to structure, timing, and supply/demand realities. The episode suggests opportunity may lie in crisis periods, emerging crypto use cases, and understanding where real bottlenecks or behavioral shifts exist.