Episode 27: The Stock Market.

Top of the show 

Welcome everyone and thank you for joining us. This is valid arguments. A show about controlling your downside risk while maximizing your upside gains. I’m Jeremy Horton, and Today were going to be talking about Wall Street bro. We will also be arguing about boobs, beer, and bongs. Joining me today is Mr. Milo Mordhorst on my right. (Milo intro). And Mr. Joel Barkley on my left. (Joel intro). Thank you both, now I will get into the questions in a minute, but first lets have a word from our sponsor. 

Questions I will ask: 

  • Now most of you hear wall street and you think of the bros from that Decaprio movie taking turns doing lines of blow while robbing grandma of her savings account. So, let me start with what Wall Street is and how it works. Wall Street is a figure of speech for capital market finance. Its purpose is the sale of ownership in a business through the issuance of stocks or bonds. The difference between stocks and bonds is like, when you’re buying a stock, you own part of the company and its assets. When you buy a bond, you’re buying a portion of the company’s debt. That some totes important info because if the stock market goes down the interest on existing bonds goes up, and that makes for some sick yields when everyone else is tits up. So, you guys diversifying or were you straight bag holders when this Rona hit? 
  •  So, check it. My next question is about the time when everyone started paying attention to WallStreet. In 2007 a depreciation in the housing market of the United States started to happen for the first time ever, and it developed into an international banking crisis. It was a totally not chill situation where the banks would take a bunch of subprime loans and bundle them together into a collateralized debt obligation and sell them like they were AAA rated. Obvi these are the highest risk for defaulting and obvi again most of them did default. At the same time, they were selling mad credit default swaps as insurance on the bond so they made fat fees and totally got to write all of that risk off their books. But then the government had to step all over everyone’s good time because the housing market crashed or whatever. So, like what do you guys think is the next big thing? I’m thinking cars or some shit. 
  • Palette cleanser/segment – Should like babes be able to breastfeed in public? 
  •  Next let’s talk about stock buybacks. A stock buyback is when a company buys its own stock, increasing the price of the stock so that shareholders in essence own a bigger percentage of the company. Getting high on their own supply so to speak. In the most recent stimulus package for the global pandemic that ravaged the world, President Trump insisted that none of the money going to these industries be used for buybacks. The reason he insisted on that is because when the tax cuts and jobs act of 2017 was passed, companies on the S&P set a record for stock buybacks to the tune of 806 billy in 2018 and another 710 in 2019. I’m talkin B’s son! Now this would be great if they were doing it to fund new research or to increase their market share. But they didn’t do that. In fact, they funded a portion of the buybacks with bonds. That means debt. And taking on debt to finance buybacks, is just bad management, given that no revenue-generating investments are made that can allow the company to pay off the debt. So, what do you guys think, are they expanding into new markets or just trying to get a fat bonus at the end of the year? 
  • Now I’m going to tell you all about my boy Bernie. Yo this gangsta ran a multi-million-dollar Ponzi scheme that duped investors out of approximately 65billion in money. You should care because this guy probably ruined the life of someone you know. That’s how big 65 billion dollars is. Imagine this dude, take 1 billion dollars. That’s 999 million! Plus, one more million! You should also care because it’s still super easy to run a Ponzi scheme. At least 60 schemes we’re uncovered just in 2019 to the tune of 3.2 billion dollars. It crazy easy too. You just need to keep encouraging reinvestment which is mad kosher once you pay off the early investors with the new investor’s capital. You guys think it’s worth a try or what? 
  •  Palette cleanser/segment – How many beer bongs is too many beer bongs? 
  • Now you guys know I have to mention the party poopers always shitting on wall street’s good time. That’s right, I’m talking about socialists. They just don’t understand that capitalism unleashes the power of human potential. Tony Robbins said that. Recently there’s been Talk about the need for socialism particularly in the health sector. That’s totally bogus though because we all know our edge in healthcare has always been due to the amount of innovation through massive capital injections to their research and development, and competition from healthcare providers. Right dudes? Can I get a fist bump? 
  •  Let’s get fresh on some quants bro. Ya I got to mention the nerds of wall street. Quants are like crazy smart dudes that measure market outcomes based on computers or some shit. Recently firms like D.E. Shaw and Two Sigma have increased the use of quants and started to hold some positions using machine learning. I don’t want to get all terminator on you guys but what if like it goes all space odyssey on us and takes all the money? 
  •  Palette cleanser/segment –  
  • How do we solve this mess? 

Argument for: 

  • . Buy 
  •  Buy 
  •  Buy 
  •  Buy 
  •  Buy 
  •  Buy 

Sources: 

Key groups: 

Key people: 

  •  Bernie Madoff 
  •  Jordan Belford 
  •  Harshad Mehta 
  •  Chris Gardner 
  • James Fisk 

Key Movies:  

  •  Floored 
  •  The Pit 
  •  Enron: the smartest guys in the room 
  • Chasing Madoff 

Argument Against 

  • Sell 
  • Sell 
  • . Sell 
  • . Sell  
  • . Sell 

Sources: 

  •  The Tower of Basel: The Shadowy History of the Secret Bank that Runs the World 

Key people: 

  •  David Held 
  •  John Holloway 
  •  Naomi Klein 
  •  John Perkins 

Key groups: 

Key Movies: 

  •  99% 
  •  Too Big to Fail 
  •  The big Short 
  •  Capitalism, a Love Story 

Outro: *summarize Joel and Milo end arguments* I think that both sides have………………Valid Arguments. Tonight’s winner had this to say. Don’t blame Wall Street, don’t blame the big banks. If you don’t have a job and you are not rich, blame yourself! Herman Cain, ladies and gentleman. If you are for  Wallstreet then I suggest you get CPA, crack open a PBR, and get your uptick on, bro. If you want Wallstreet outlawed entirely, then I suggest you move to China.  If you decide to do nothing, then at the very least, keep arguing and talking about it. Because the only way we solve any controversial issue, is to argue about it. 

I’d like to thank you all for joining us, and thanks milo and Joel for your thoughts on the subject. If you want YOUR voice counted amongst those that argue, then get at us on social media @argumentsvalid on twitter and valid.arguments on Instagram, or if you think social media is just as evil as that bitch Carol Baskin, please feel free to call and leave us a voicemail, the number is on the website ValidArguments.org. And if you like the show please leave us a rating and review, and tell your friends to argue with us as well. and please join us next week for more arguments for you. We hope to disagree with you soon

Leave a Reply