The transcript from this week’s MiB, David Gardner, Co-Founder, The Motley Fool is below.

You can stream the full conversation on Apple Podcasts, Spotify, or Bloomberg.The video version is on YouTube.  The full archive of MiB episodes can be found here.

~~~

Masters in Business: David Gardner Co-founder of The Motley Fool

Barry Ritholtz: [00:00:02] Bloomberg Audio Studios, podcasts, radio News. This is Masters in business with Barry Riol on Bloomberg Radio. [00:00:16] This week on the podcast, I had so much fun chatting with David Gardner of The Motley Fool. I remember The Fool back in 93, 94 when it first launched on a OL. What a fascinating career. If you are a stock picker, if you’re someone who really is committed to finding the best companies and then riding them for decades, you’re gonna find this conversation really fascinating. [00:00:41] I thought his book was really interesting. His whole approach to life to investing is really great. I enjoyed our conversation and I think you will also, with no further ado, my discussion with the Motley Fools David Gardner. Thank

David Gardner: [00:00:55] You, Barry. It’s a delight to be with you. Thank you so much.

Barry Ritholtz: [00:00:59] I have a vivid rec recollection of sitting on a trading desk and watching you guys pop onto TV at various times. And as soon as you guys showed up, I’m like, all right, let me pull up Nvidia and Netflix. I knew they would start running and then soon turn around and fade. So it was always, just intraday, we’ll get a little later to the difference between investing and trading. [00:01:25] Yes, sir. But first, I have to go back to your background ’cause it’s so unusual. University of North Carolina on a Morehead scholarship focused on bachelor’s in English and creative writing. I assume Wall Street was not the original career plan.

David Gardner: [00:01:42] It actually was a career plan. As I came to UNC Chapel Hill as a freshman, I was telling people, I think I’m gonna go to work on Wall Street. I had a formative summer in between my sophomore and junior year where I worked at Solomon Brothers back in the day. The Good Friend era.

Barry Ritholtz: [00:01:59] I think Michael Lewis was writing Liars Poker somewhere around then. Late

David Gardner: [00:02:02] Eighties, I think it first dropped 80 89. [00:02:04] The year was 1986 for me that I was at, oh, she probably

Barry Ritholtz: [00:02:07] Overlap with him at the same time. It

David Gardner: [00:02:08] Was, I don’t recall Michael, and I’m really glad to see where he’s guys, he’s gone on to Great heights. But that was the summer I learned I was never gonna wanna go work on Wall Street. That’s that. That was a really wonderful experience.

I just realized it’s not a culture that I’m gonna probably spend time in with as an, as an adult. And so that was so helpful. I love the markets. I just wasn’t a Wall Street person.

Barry Ritholtz: [00:02:31] And you grew up in a household where markets, investing stocks were part of the daily conversation. Your dad helped you win a high school stock picking con contest. Tell us a little bit about that.

David Gardner: [00:02:41] Sure. It was actually earlier than that. It was fifth grade. It was fourth grade, really. [00:02:45] But my dad probably did what other dads did pick stocks for their son in this all boys school, St. Alvin School I went to in Washington, DC And I remember he had hard court brace Jovanovich, he had Getty Oil. This is bad, these companies aren’t around anymore too much. But that was my stock portfolio. And over the course of three months, I outperformed my classmates.  And so I won a gigantic Hershey bar, like to my 10-year-old eyes. It was the biggest Hershey bar I’d ever seen. But it was a wonderful introduction, back the real exercise. Then Barry was just to look in the newspaper to write down 16 and five eights where the stocks closed. [00:03:21] We would do that once a week over the course of three months and just start understanding the markets. So that was an early experience, but really dad was so formative for me as an investor.

Barry Ritholtz: [00:03:31] It’s always, it’s always fun talking to the youngsters who grew up with Decimalization. Yeah. Because I vividly recall what’s the price Pacini you don’t get that anymore. True.

David Gardner: [00:03:42] It’s a, it’s a whole, it’s a whole, I love [00:03:45] Your listeners Duke, Barry and I get it

Barry Ritholtz: [00:03:47] 16th and right, I get it. Yeah. Right up a stick up a half, whatever it happened to be. And then how did you end up writing for Louis Ru Kaiser’s Wall Street newsletter?

David Gardner: [00:03:56] Yeah, so I started out of college, took a couple years to read and write and travel a lot. Got married without a job, and then it was time at the age of 24 to get my first job. And as it turns out, the newsletter that was supporting Louis Rukeyser, remember his show, wall Street Week Sure. Longest running show on PBS. [00:04:14] And he had a newsletter with a financial newsletter. And I got to write the back page of that newsletter for that first job. We were reaching hundreds of thousands of people and I could pick whatever topic I wanted. So it was really fun, except it ended up not being fun. [00:04:27] And the reason it wasn’t fun is because I would pick a subject like Discount Brokers, which was a brand new amazing thing back then in 1992. Schwab, what’s that? Or Quicken. There’s now software you can DVD load onto your computer and track your finances and your stocks.

So I would write these up and then the edited version would come back with all of my jokes, color and fun stripped. And the second half freshly written by my editor, explaining all the reasons you wouldn’t want to use a discount broker or Quicken. And that’s because I was instructed, I was never, I never took a journalism course, but I was just an English major. But they told me, we have to balance it out here, David, in fact, Ru Kaiser is the personality, he’s the color of this newsletter. [00:05:15] So not you, we’re not, we’re stripping out the color. And also you gotta be, you gotta talk about the downside of discount brokers and quick. And I was like, I don’t wanna do that. I don’t see downside.

Barry Ritholtz: [00:05:23] Well, the [00:05:24] Downside is you’re taking money out of stockbrokers children’s mouths. well said. What’s the, what’s the downside of paying less to trade?

David Gardner: [00:05:33] Yeah. Well, I discovered that the downside was a job that just was kind of creatively deadening. It doesn’t really reflect on Lou Ki Ru Kaiser. It was the goal of that newsletter just to, supplement his TV show and all the rest. [00:05:44] So, but after six months, I quit the job. ’cause I was just like, this is not fun. There,

Barry Ritholtz: [00:05:49] There’s an argument to be had that Ru Kaiser was Peak financial television and it’s been downhill ever since. I like an hour week is plenty. I were, they, was he a half hour or an hour? I don’t even remember.

David Gardner: [00:06:00] Think it [00:06:00] Was an hour a week. I think it was an hour a week. Yeah, it was generally Friday. It would air different and March night.

Barry Ritholtz: [00:06:04] But Friday night, after the, [00:06:06] I remember him from Friday nights.

David Gardner: [00:06:07] And you remember his wit, he always had a monologue

Barry Ritholtz: [00:06:10] Start very dry. Yeah. Right. So let’s go over to our, what was it? [00:06:14] Elves? Wizards, I’m trying to remember. Elves, right?

David Gardner: [00:06:16] I think it was elves.

Barry Ritholtz: [00:06:17] And it was always fascinating. And I, it’s funny, I’ve seen as many of those on YouTube decades later. Yeah. That I saw as many as I’ve seen live on Friday night. [00:06:30] Okay. Like, I got no plans. All right. Let’s see what Louis has to say.

David Gardner: [00:06:34] That’s really fun that you would go back and revisit. I’ll just say he was, he was a wit he was himself outside of Wall Street. he is sort of a journalist, but he en he enjoyed bringing together brilliant minds on Wall Street. he had Peter Lynch, he would regularly focus Lynch and others. [00:06:50] And so

Barry Ritholtz: [00:06:50] Peter Lynch, Lizanne Saunders, you go down the list of people that he had, I’m trying to remember, was it Paul Tudor Jones before the 87 crash might

David Gardner: [00:07:00] Well have

Barry Ritholtz: [00:07:00] Basically saying, I’m, I’m outta stocks. I’m short. I think something terrible is about to happen. And then Black Monday happened was like, you, there was no other place to see stuff like that except we take it for granted today that it, oh, you wanna see something? [00:07:16] It’s out there. Yeah. Bloomberg,

David Gardner: [00:07:18] Right? CNBC. Right. I remember FNN was like the early player,

Barry Ritholtz: [00:07:23] Pre CNBC. Definitely that. And then CNN fn was a another one. You were right.

David Gardner: [00:07:29] So, and then, so now [00:07:30] We’re going down memory lane. Is this what? Yeah. Is this where your audience wants Barry?

Barry Ritholtz: [00:07:34] No.

David Gardner: [00:07:34] Do we to is not what they want. We

Barry Ritholtz: [00:07:35] Stay down memory lane here. I’m [00:07:37] Enjoying it. They do not want that. But so let’s talk about, you go from Ru Kaiser. Where did the idea with you and your brother working in a shed in the backyard, where did the idea come from? Hey, I want to put my own ideas with personality into a newsletter. Like how did that become an actual product?

David Gardner: [00:07:59] Well, I quit that job with nothing to go to. And then my brother’s best friend from Brown University, they both went to Brown. Eric said, Hey, David, I went to Brown, but I shockingly, I really know nothing about investing in the stock market. I’m from great education, great family. [00:08:14] I’m a television sports producer. What’s going on in stocks? So would you teach me? So I spent a couple of nights just sitting down with Eric going, here’s what I look at. [00:08:21] Here’s what I do. I was raised in a family where you buy individual stocks. We’re not just gonna index here. We’re gonna, we’re gonna be cho choiceful. [00:08:31] And we had so much fun, Eric’s like, why don’t we open up? This is a newsletter. You have no job now. You just work for a newsletter. [00:08:36] I was like, okay, let’s do that. And then I flipped through a book of quotations one night and I settled on a fool, A fool, I see a fool of the forest, A Motley Fool. And I just thought, Shakespeare, those were some as you like it, act two, scene seven for those keeping score at home. But for me, this was, a character. [00:08:52] I loved studying, certainly going through school. And everyone loves Shakespeare’s Fools. They could tell the king or queen the truth. And they did so with humor.

Barry Ritholtz: [00:08:59] The, [00:08:59] The only one who could get away with it

David Gardner: [00:09:01] Also. That’s, that’s right. They were given license to tell the truth. So I sort of loved it. [00:09:05] Also li great lines like a fool in his money or a soon parted, gave us a steep hill to climb as we tried to build trust with people. Why would you call yourselves fools? And it started there and it started as a print newsletter. You mentioned that, Barry, it was July of 1993 was the first issue. [00:09:21] $48 a year. The only people who subscribed our parents’ friends, they were the only ones who pay us 48 bucks a year. Our friends sure weren’t going to for our financial advice back then. But as we started that newsletter, 1993, early 94, we were signing on using our modem, our telephone onto a OL Prodigy and CompuServe, the big three in the early private online services battle. [00:09:46] And we were starting to discover this new medium and getting fascinated by it. And

Barry Ritholtz: [00:09:50] I recall a OL as a stock was two or $3 in the early nineties. Something really moderate before it had a hellacious run straight up for that whole decade. What was it like, first of all, you guys got fool.com today.

David Gardner: [00:10:07] Nobody else wanted it.

Barry Ritholtz: [00:10:09] Every proper noun, every dictionary word is taken. Although who knows what AI and the slow shift from Google, from SEO to AI is gonna do to, there you go. All these domains, but like domains changed hands from millions of dollars. It’s kind of crazy. [00:10:28] You went to get fool.com

David Gardner: [00:10:30] No competition. It was, yeah, nobody wanted it. Nobody wants fool.com.

Barry Ritholtz: [00:10:33] Oh my god. What? So the missed opportunity was I could domain squat on every proper No. So you launched the website, how long was it before it was got some traction?

David Gardner: [00:10:44] So we really launched, first of all, Barry, it was August 4th, 1994. It was just on a OL because this is pre Worldwide web, right. People were not using that phrase yet.

Barry Ritholtz: [00:10:52] 97 was Netscape, right?

David Gardner: [00:10:53] Yeah. Something like that. Yeah. I would actually say 96 ish was when we started coming online on the web. [00:10:58] But no, it was just keyword Fool on AOL. But AOL was going through a period of dynamic growth. Unbelievable. So it’s fantastic for us. We launched in August. By November we were written up in the New Yorker in the Talk of the town section. And then we had agents and publishers saying, there’s a book here guys. And we’re on television. [00:11:16] We’re we’re, we have a radio show, coast to coast. We just, we were like the early pioneers who believed in this new medium. And we were going offline Right. As fast as we could to all, everybody else was trying to come on online.

Barry Ritholtz: [00:11:29] Right, exactly. So, [00:11:30] So you were, you were already in, I, it’s almost embarrassing to use the phrase cyberspace. So you were online, but you used

David Gardner: [00:11:38] On the Information Super Highway. That’s

Barry Ritholtz: [00:11:40] Right. But all the traditional media to point towards the website, how long did it take before you kind of said to yourself, Hey, this is a real business, I don’t have to go get a job, I could just

David Gardner: [00:11:52] Build this. We started at such a good time because a OL as you’ll recall, was a pay per hour

Barry Ritholtz: [00:12:00] Service. That’s right. In the beginning anyway. Correct.

David Gardner: [00:12:02] Like $3 25 cents. I think they raised it to four at one point. Right. And so the business model was remarkable for us. [00:12:10] If somebody spent an hour at Keyword Fool, we would get 10% of that. So if they’re paying aol four bucks an hour, 40 cents, 40 cents for any hour that anybody would spend at our site. And so with a tiny staff and a big dog that was mailing out CDs and DVDs to get onto AOL, the services cocktail coasters at parties, we really benefited from that ramp. And so we began to be able to hire other people. [00:12:39] And that when the, so that, yeah, that was it.

Barry Ritholtz: [00:12:41] When the CDs started getting mailing, I think they had moved to like all you can eat $10 Yeah. A month or something like that. It’s

David Gardner: [00:12:49] More like 30 bucks a month.

Barry Ritholtz: [00:12:50] 29 95. Exactly. Yeah. I don’t, I don’t remember exactly what it was. [00:12:53] Yeah, I just remembered that was the end of surprise bills. Oh, it’s infinite. Okay, great. Yeah, I’m on 24 7.

David Gardner: [00:13:01] And that hurt our business a lot. Oh, some It also, it also more traffic, major inflection point. Yeah. Because we had built a site that was really fun to visit. [00:13:11] We had very active forums. We were publishing multiple times a day. Lots of people were showing up. There were even chat rooms back then. [00:13:18] Right. People were spending time online and 40 cents for every hour. So we were starting to hire people. And then within a few years, AWOL went flat rate. [00:13:26] And all of a sudden we had been the stars of AOL. They were putting us forth at their partners conference. We were on the cover of Fortune Magazine just three years after we started print newsletter. We were right out front. [00:13:36] And then we became kind of poison for AOL in this sense, every hour that anybody spent AOL had to pay connect fees. Now

Barry Ritholtz: [00:13:44] It’s a cost instead of a But they’re [00:13:46] Be, yeah. They’re only charging 30 bucks flat a month. Right. And so all of a sudden, magnet sites like ours were not as popular.

David Gardner: [00:13:53] And then meanwhile, a OL understandably, we, no harm, no foul here, but they were starting to launch a OL finance and a OL stocks and competing directly with kind of where we’d camped out and built our base,

Barry Ritholtz: [00:14:05] Hold my beer, we’re gonna launch our own website, whether people access it through you or not. Yeah, that’s fine. So, and we know the how the a OL story ended at that point you’re thinking, oh, this is a big issue. How long did it take before the website hit the same sort of, oh, this is a self-sustaining business?

David Gardner: [00:14:28] Yeah, so we launched the website alongside our a OL site with our first book, the Motley Fool Investment Guide in the summer of 1996. And the website, a OL took part ownership in us. So we gave, we gave a minority interest in our company to a OL and they’re like, guys, go out on the web, compete with your own site, compete with us, Ted Leonis, who is a real visionary. And Ted was like, guys, no one’s making money on the web show anybody how to make money here on the web. [00:14:54] And so we built our website and we started pointing people to our, both our website and our AOL site. And as it grew and as AOL went flat rate, the good news for us is a lot more people came online at that point. 30 bucks a month versus $4 an hour. A lot. [00:15:09] That’s mainstream. Yep. And also good news for us is that we could survive as a free site. So we could now be free for a lot of people. [00:15:17] The bad news was, we’ve shifted business models straight up advertising. Right At that point, it’s all about eyeballs and clicks. And your customer, our customer just changed because our customer had been the beloved fellow individual investor who was taking a risk to even go online back in the day. Right. [00:15:34] And there they were paying four bucks an hour and they loved us, and they were our members and they were paying us directly. All of a sudden they became the product that we sold to advertisers. Right. Because that’s obviously the free ad business is your customers, your eyeballs are now your new product.

Barry Ritholtz: [00:15:51] And as a reminder for the youngsters listening, 96, 97, wait, you want me to give my credit card to a random moment? this is

David Gardner: [00:16:00] Such an important

Barry Ritholtz: [00:16:00] Moment. Like early days of Amazon, early days of AOL. All right. There were a handful of companies you might trust, but there’s a million websites. [00:16:08] I don’t trust any of these guys. I heard that over and over again. How long was it before you people felt, oh, we could subscribe to this newsletter, we could give these people money to manage What was the forward timeline?

David Gardner: [00:16:20] So thank you for that memory, because this is very important. Anytime a new technology shows up, it’s generally we’re fearful about it. What is AI gonna do to jobs? Well,

Barry Ritholtz: [00:16:29] Back then, I had a tech buddy who always used to tell me, if you wanna know where technology goes, watch the X-rated stuff course, they’ll be the, they’ll be the first with micropayments. They’ll be the first with faster than real time and streaming and things like that. And it turns out that’s a big driver of online business even to this day.

David Gardner: [00:16:49] Yeah. And I think that’s that’s true. So you’re right, premium experiences and premium services are where the web has ended up. However, there was a whole shift. [00:16:58] 98, 99, 2000. You really couldn’t charge for anything on the web. If we had tried to say, you now shall pay for our site or there we have a subscription service, we would’ve been laughed at. Right. [00:17:10] At the same time though, as a stock picker, I was picking AOL stock saying, I think this is an amazing company. And it sure enough was it ended up being 150 bagger at its top didn’t end there. But it was still a remarkable investment. And lots of people had followed us into AOL and other stocks like the Amazon. [00:17:28] And it was really going against conventional wisdom at the time to say, buy Amazon, buy AOL. And so I want people to remember that because now it looks so obvious. AOL didn’t end well. Amazon has ended really well.

Barry Ritholtz: [00:17:42] It hasn’t ended. Right. That’s right. So it’s important to remember those moments. [00:17:46] ’cause we tend to forget them. We also forget the dawn of ai. This is first thing in this ball game and people will look back and go, it’s also obvious in retrospect.

David Gardner: [00:17:54] Right. It’s always obvious in retrospect. [00:17:56] It is indeed, Barry. It’s

Barry Ritholtz: [00:17:57] At the time. It’s really challenging. So last question in this segment, if you were starting the Motley Fool in 2026 instead of 1993. So we have social media, we have free trading, we have ETFs everywhere. [00:18:15] The world is so different today than it was 40 years ago. What would you do 30 years ago anyway? What would you do differently? How would you build a site and a business today, this time around?

David Gardner: [00:18:27] Well, I think first of all, one thing that we know today that we didn’t do back then that I think is very helpful in every era is to be a purpose-driven business. And to state what is your mission? What is your purpose? And really hue to that and breathe through that and hire for that and promote because of that. [00:18:44] And conscious capitalism is one of my themes as an investor and a board that I’ve served on. So I now have those eyes that I didn’t have back then. And I think that is such a strong thing. Most of the best companies I know look at crazy business of fast food. [00:19:02] Chicken Chick-fil-A is an amazing company. I wish it were a public market company, it would’ve been one of my stock picks. But they just fundamentally act differently than McDonald’s and their competitors. And it’s because it’s like a leadership academy masquerading as a chicken joint still closed

Barry Ritholtz: [00:19:18] On Sundays.

David Gardner: [00:19:18] Yeah, exactly. Which is their choice. Radical and it, so those are the kinds of companies that I admire. And like, that’s what I’ve always wanted the Motley Fool to be. [00:19:26] So I would do that in earnest today in a way that I think would cut through a lot of the noise and people saying there’s too many choices and all the rest standing for something and then living that every day. Most of the best companies that I can think of do that. So I would be trying to do that, Barry. But yeah, it is a different world. [00:19:42] We, one thing that’s changed, I think for the worse, and I’m an optimist, almost everybody’s mailing it in with index funds these days. Like I was raised in an era where it was kind of normal, at least in my family, buy a stock these days, the conventional wisdom has become, you’d be crazy to buy individual stocks that’s so risky, just index. And while I admire Jack Bogle deeply, and I appreciate indexing and the Motley Fool has always been a big supporter of index funds, have we really got an era where you shouldn’t even pay attention or care anymore. And you can’t probably beat the market because it would just be luck to pick Chick-fil-A over Kentucky Fried Chicken. [00:20:22] I don’t think so. I didn’t think so back then. And so I would be definitely sounding that loud and clear today. There’s even more big dumb money sloshing around than ever before. [00:20:30] ’cause so much is just throwing it at everything and not discerning this one versus that one. Huh.

Barry Ritholtz: [00:20:33] Really interesting. Coming up, we continue our conversation with David Gardner, co-founder of The Motley Fool, discussing his book, rule Breaker Investing, how to Pick the Best Stocks of the Future and Build Lasting Wealth. I’m Barry Ritholtz. You are listening to Masters in Business on Bloomberg Radio. [00:21:03] I’m Barry Ritholtz. You are listening to Masters in Business on Bloomberg Radio. My extra special guest is Dave Gardner. He’s the co-founder of the Motley Fool and the author of the book, rule Breaker Investing, how to Pick The Best Stocks of the Future and Build Lasting Wealth. [00:21:20] So I wanna talk a little bit about the philosophy around rule breaking investing and stock selection. One of the things that jumped out of the book from your framework was top dog and first mover customer love, visionary leadership, discuss.

David Gardner: [00:21:40] Yeah. Well thank you. These are some of the traits that I’m looking for in stocks. And I think before we start this, Barry, I should just, again underline, I believe it is a worthy thing to choose stocks. [00:21:53] I really want to find the best companies of our time and I wanna own them for a long period of time. And actually it’s, it’s, for many people, it’s actually easier to find Amazon or eBay back in that era or Nvidia more recently. But to actually hold them, to hold them, to allow them to multiply in the way that they will, if you do, in my experience, that’s hardest

Barry Ritholtz: [00:22:15] For most people. Let’s, let’s talk about that. ’cause Amazon, after the.com crash plummeted to single digits. Yep. [00:22:23] Apple has had more near death experiences than I can count Nvidia. Go down the list. Google, Facebook, Tesla, Facebook’s IPO was a disaster. It got cut in half, like within few months of that. [00:22:35] And then they kind of unlocked mobile and it was off to the races. Yeah. Tesla, the, these companies trade more like cryptocurrencies than companies. How do you find the confidence and the commitment to stay with something down 40, 60, 80%?

David Gardner: [00:22:54] So thank you. And I would say first of all, it’s not worth doing that for every investment. Certainly if it were some dodgy crypto, I wouldn’t be holding. But you used an important phrase a minute or two ago, you said top dog and first mover. [00:23:09] So when I look at important emerging industries and I see a company with a large customer base, they may not be profitable yet, but they’re doing good things in this world, a world I wanna live in. And their stocks down, their stocks been cut in half. What’s the reason? Sometimes it’s the CEO like Howard Schultz back in the day with Starbucks, was just occasionally conservative and the analysts were surprised as he under promised. [00:23:35] And then the stock drops 15%, and a week you,

Barry Ritholtz: [00:23:39] You told the story about this going on the view, yeah. The stock ends up down 30%, but, and that was your last appearance. And then what happened to

David Gardner: [00:23:47] Starbucks? It went up 30 times in value. And we’ve never been back on the view, but, and by the way, I’ll return at any time. We’d love to close the loop on that story. [00:23:54] But yeah, that was 1998, early TV appearance. We picked a stock for the ladies of the view and then it was Starbucks. That’s the punchline by the way. I shouldn’t have given that. [00:24:05] But yeah, the stock dropped 30% in just a couple of months. And we went back on the show to update the story and they booed us good naturedly. And they’re like, oh

Barry Ritholtz: [00:24:15] Well. And we’re

David Gardner: [00:24:16] Like, keep holding though. Keep holding. And then they’ve never invited us back since. And it’s gone up 30, 33 times the value from our first appearance, not even including the 33% drop. [00:24:26] So, that was an iconic moment. I didn’t realize it at the time, but as I wrote rule breaker investing, I was just thinking, that’s my story. Because that’s what most people miss. Most people are following the headlines instead of following real progress and they’re chasing stuff. [00:24:42] And if you just look and ask who are the movers and shakers delivering products and services, electric cars, robotic surgery, coffee houses, better fajitas, the list goes on. Who are the,

Barry Ritholtz: [00:24:55] So I’m thinking Stryker, Chipotle, Tesla.

David Gardner: [00:24:58] Yeah. Well actually intuitive surgical. Okay. But yeah. [00:25:01] Yeah. But yes, you’re thinking exactly the comments. I was thinking,

Barry Ritholtz: [00:25:04] I’m seeing the robot that did my surgery.

David Gardner: [00:25:06] Ah, I’m very happy

Barry Ritholtz: [00:25:07] To hear that. And when I recall walking into the surgical theater and looking around and saying, oh, this is where the future is. I’ve just gone 20 years forward. Yeah. [00:25:18] ’cause this whole thing is here’s the big robot with all the like, oh, now I understand. Like the rest of the world. We’re living in the past. This technology is as cutting edge as it gets. [00:25:29] It’s, it’s really amazing.

David Gardner: [00:25:30] I love that. And I’m so glad to hear that for you in successful surgery, which is what we all want, robot or human. But yeah, it turns out there are lots of advantages to robot assisted surgery. Yes. [00:25:40] And Intuitive Surgical has really been the pure place small companies. Stryker is a more bigger diversified company. Yeah. Anyway, but for each of these, like,

Barry Ritholtz: [00:25:48] I just happen to remember what the little logo on the saw, the last thing I saw. That’s

David Gardner: [00:25:52] A good thing to do. Yeah. They’re

Barry Ritholtz: [00:25:54] Like, this’ll help you relax. And then the next thing I know, I’m in recovery. Wow. But the last thing I saw was the Stryker logo.

David Gardner: [00:25:59] Great story. And, so it’s funny you mentioned the future and feeling like you’re living the future. That’s generally where I try to be as I pick my stocks. And just for the fun of it, one of my best stock picks and the last 15 years has been Tesla, which I picked in 2011, still holding. [00:26:15] And I bought, I’ve owned a number of Teslas since, and I was driving around in Tesla in 2013. My license plate in Washington DC is future. Like, no one else thought of it. So I’m, I’m watching out for the future Washington DC and I’m driving around going, I really am inside the future.

And I’m surrounded by not just other cars that aren’t yet, but a whole industry, gas stations, et cetera of things. Right. There’s not as much maintenance needed. So that’s a great iconic example of, for me, whether it’s Starbucks back in the day, which was questionable for a lot of people ’cause it looked like a fad.

That was the big wrap on Starbucks early nineties. Where have coffee houses ever come from in America? There’s no background for this. This is such a fad paying five bucks for coffee. Are you serious? Right. That, so AOL was all just chat rooms. They were all gonna be hyped.

No one will ever give their credit card over the internet. Tesla electric cars will never work. Intuitive surgical. Why would you have a robot when humans can do it just as well do the list goes on at companies

Barry Ritholtz: [00:27:15] All the way around. Why would you have a human when a robot can do it, that

David Gardner: [00:27:17] Is indeed

Barry Ritholtz: [00:27:18] More, not only just as well, but more consistently. Yeah. And it doesn’t matter if they had a bad night, it’s, it’s fine the next day.

David Gardner: [00:27:26] And minimally evasive. Right. And speaking of the next day, you’re walking home the next day, that night it’s most of

Barry Ritholtz: [00:27:30] Two days. Oh no. Same day you walk outta the hospital. It’s kind of terrifying.

David Gardner: [00:27:34] Although you’re still on a lot of drugs at that. Yeah. [00:27:36] So, well one of my heroes is Clayton Christensen, who wrote The Innovator’s Dilemma. And he’s somebody who helped me understand and think about disruptive innovation. And I’ve always invested in the innovators. And back to your earlier question, Barry, I can keep holding my Netflix when it loses two thirds of its value when I believe in Netflix and I see visible proof every day of how important Amazon back in the day, Netflix, Tesla, the list goes on, the companies we’ve mentioned. [00:28:03] So that helps me hold these companies. If you follow the company as opposed to the zigs and zags and the stock charts or the headlines, you’re going to be much more patient, I think, as an investor. And that has been my, that’s been a superhero power for me.

Barry Ritholtz: [00:28:15] So walk us through your stock picking process. How does a company first land on your radar? What sort of analysis do you do? When do you decide you’re comfortable to put it on your buy list? [00:28:28] And are there any non-negotiable check boxes that you say, Nope, that’s a knockout. They don’t

David Gardner: [00:28:34] Have this. every one of those questions I could possibly fill your ears up. So I’ll try to be brief. I love the questions in reverse order, by the way. [00:28:42] I’ll say any non-negotiables. I don’t invest in companies whose fundamental business is to take money from other people. And so you’ll never see me recommend a so-called gaming stock. And I think sports betting is a joke. [00:28:54] And it’s, while I think it always should have been legal, I think it is a sad waste of money for anybody who does the math. And so that would not be on my list. No Mott lethal member has ever received a gaming recommendation from me.

Barry Ritholtz: [00:29:05] And they have been very destructive, primarily to college age men. Yeah. There’s a growing gambling addiction problem. And these companies just, that’s their, that’s their clients.

David Gardner: [00:29:17] Yep. And I will say I love sports. I know you do too. And I’m happy making a bet with friends. [00:29:23] But if you really do the math of a 50 50 prospect where the house takes out its 10% Right. And you just do your expected return and play that forward with all your money, I know where that goes. And you could have had nine to 10% annualized returns.

Barry Ritholtz: [00:29:36] There’s a huge [00:29:36] Difference. You [00:29:37] Knucklehead, there’s a huge difference between doing a box for the Super Bowl or something. Yeah. For March Madness.

David Gardner: [00:29:44] Yeah. Have fun

Barry Ritholtz: [00:29:45] And betting on free throws. it’s, it’s just, it has nothing to do with sports. That’s just the medium by which they are tickling your adrenaline and dopamine. It’s, it’s so, and yet the these have become giant

David Gardner: [00:29:59] Businesses. Yeah. And, even something as innovative as prediction markets, which I am fascinated by, are also being turned into quick money and or sometimes questionable who can influence the outcomes of prediction markets. So these are unfortunate things where I think they’re fascinating to follow, but if you’re serious about your own money and you would like financial freedom one day, you’re making a huge mistake if you go there. [00:30:19] So back to your question, that’s a non-negotiable for me. I don’t like businesses that just fundamentally lead people who don’t know math to give their money away regularly. I don’t feel great about that if I’m a shareholder.

Barry Ritholtz: [00:30:31] So let me roll you back a little bit. How does a company typically find its way onto your ra radar? Is it something you’re using or something you hear about? Like where do most of your these ideas come from?

David Gardner: [00:30:43] So the ideas come from, first of all, I’m an early adopter, so I’ve got a closet full of things where I bought the thing early first gen and it’s not really working or wasn’t relevant anymore. And so, but it also meant I bought Tesla very early on. I, and I tried online services with my scratchy phone. That sound we can all hear if you’re over 40 years old today of logging onto AOL.

So I love the new, I’m excited by ai and that’s not an industry by the way, that is a plate tectonic shift for our society that’s gonna create many industries, many of which don’t even exist yet. Just as we were excited about the internet with Amazon, where my cost base is today, is 16 cents still holding? Uber hadn’t even shown up yet. Google hadn’t shown up yet.

It’s, it will be years before AI companies that are amazing, that are great stocks show up. So no one should feel anxious that they don’t have an AI portfolio yet. But anyway, so I’m an early adopter and then I’m connected to a community, the Motley Fool community, our forums, discussion boards, meeting people of book signings. The list goes this conversation right now.

Barry Ritholtz: You mentioned Stryker. I probably need to look back at that one. I’m curious how it’s done. So I’m just always listening.

David Gardner: Of course, social media is full of these kinds of opportunities. So intellectual curiosity is the flame that will burn my whole life long. And in many of my fellow fools, and I think my host today as well. So I think that if you’re curious and you’re asking questions about where society’s headed and you’re specifically looking for products and services that will improve our lives and our kids’ lives, you’re going to be looking, you’re gonna be fishing in the right pond.

Barry Ritholtz: [00:32:14] So once something falls on your radar, you have six rule breaker criteria. Walk us through those six. Yeah, I’ll do really that’s the heart of the analysis that you do, right? It

David Gardner: [00:32:24] Is, it’s, it’s six traits that I’m looking for. And that’s the middle of my book. And I didn’t start the book that way. And we could talk about that later if you like. [00:32:30] But let me just rattle right now through my six traits of rule breaker investing. And by the way, I’ve used these now into my fourth decade. I didn’t just come up with these yesterday. This is exactly what caused me to pick AOL, Amazon, Tesla, Nvidia, the list goes on.

And it’s, some of them are so contrary, which is why I think it works. Number one, top dog and first mover in an important emerging industry. We already spoke to that one. We could go deeper.

You might. So for today, that might be Nvidia, it might be Broadcom, it might be aASM lithography, it might be AMD, it could be any of the semiconductors or some of the software companies. Google, Microsoft, whoever.

Yeah. And also by the way, restaurant companies, retail, and every industry I’m asking who’s the innovator? I wanna know who the Inno And if you honestly just only focus your stock market attention on the biggest innovator in each industry. Some of them are small emergent, some of them are big. [00:33:25] You’re gonna do so much better as an investor.

Barry Ritholtz: [00:33:27] So Starbucks the third place. Yeah. That was the big driver of them. Chipotle, they came up with a way to assembly line fresh food.

David Gardner: [00:33:35] Yeah. The fact that it better quality, the fact that it happens to be Mexican based is almost revent irrelevant. You see Kava today doing the same thing with Mediterranean. And I’m sure there are dozens of others coming up. [00:33:47] There are, and by the way, not all of these work out as stocks. I certainly have a closet full of bad stock picks as well. And we could talk about that later. But that’s very important. [00:33:56] If you have sort of a venture capital mentality as you look at the public markets, which is how I describe myself, you need just like a vc, you need to be comfortable with losing. It’s,

Barry Ritholtz: [00:34:05] It’s okay. In other words, it’s, you’re, you’re looking for here a hundred investments, 50 A aren’t gonna work out 30 will do. Okay. But it’s the top two or three that make it worthwhile.

David Gardner: [00:34:15] Yeah. And I truly go into all hundreds saying, I like this company. I believe in it, I hope it works out, but I’m never loading up on one, et cetera. So top dog and first mover and important emerging industry of my six traits, that’s the most important. [00:34:29] So number two, we’re looking for a sustainable competitive advantage.

Barry Ritholtz: [00:34:34] A moat as Buffett likes

David Gardner: [00:34:36] To say, you bet. And because we’re holding stocks for a dead minimum of three years, preferably three decades, sustainable competitive advantage really matters. And that takes many forms. We could talk about that. [00:34:50] Number three. So the first two are about the company, the third is about the stock. And this is, I’m looking for a strong stellar past price appreciation in the stock.

Barry Ritholtz: [00:35:01] In other words, you’re not looking for the cigar stub to use Ben Graham’s the opposite phrase. You’re looking for something with a little momentum and where more and more investors are stepping in.

David Gardner: [00:35:13] There’s a chapter in my book and it was an eye-opener as I wrote it and realized it, where I listed out seven of my best stock picks from intuitive surgical to Netflix, to Apple, to Amazon, to Nvidia and a couple of others. And I noticed, and I only realized this in retrospect, that in the three to nine months leading up to my first pick of them, on average they had risen 30 to 90%. And a lot of people, I think most people when they are researching a stock, it goes up 50%. They’re like, oh that’s missed it.

Barry Ritholtz: Right? It’s done. Right.

David Gardner:  Yeah. And so part of the reason rule breaker investing works is because I’m willing at that point, not just to buy it, but to actually be more excited about it. Because clearly the market is noticing what’s happening now. And when companies rise, reflexivity starts to show up, Barry, they start having more resources. [00:36:04] They’re getting mentioned on Bloomberg radio, all of a sudden a lot of good stuff starts coming to them that strengthens them. That’s not a reason to look for another cigar bot and ignore Nvidia. So that is trait number three, stellar past price appreciation in a world where most people are like buy low, sell high, right? I’m looking to the 52 week low list friends, not the 52 week high. And when I say friends, I mean that’s the average person speaking. I’m looking for the 52 week high.

Barry Ritholtz: Give us four, five, and six.

David Gardner. [00:36:31] So number four, it’s all about the people. We’re looking for smart backing and excellent management. So it’s the human capital. And this is again, in some ways obvious.

Yeah, we’d love to have Steve Jobs be our CEO. Yeah, we’re glad that Jeff Bezos is our CEO or Warren Buffett. But keep in mind, and this is a really hidden in plain sight, I think profound insight that most people don’t see, even though I, it’s hidden in plain sight, there is no number to express the value of the CEO running companies. So we have a whole Wall Street world that’s built on valuation rate ratios, generally off of earnings or cash flow, sometimes off of assets.

And they’re not including that Elon Musk is the CEO of the company. And by the way, there are a lot of CEOs who are subtracting value from their companies and there’s nothing to express that. And so we have a whole world driven off algorithms that increasingly is computer trading. It’s not even humans anymore. [00:37:29] And they’re not noticing or caring. I think about trait number four, who the heck’s running this thing and who’s backing it? That matters deeply to me, especially if I’m holding as I do for three decades. Number five, we’re looking for strong consumer brands.

I love companies that have raving fans. And it doesn’t mean every time that they are a consumer brand. Stryker Drilling, intuitive surgical, these are not consumer brands per se, although Intuitive Surgical with its Da Vinci surgical robot, you will hear your local on your local radio if you still listen to it, you’ll hear an ad for the hospital bragging in some cases, right, that they have a Da Vinci. So there is some brand recognition there. [00:38:07] But Starbucks, Netflix, Amazon, these are all my best stock picks and I bought them years ago and still hold them today. And they all exhibit that strong consumer appeal. And the final probably my favorite secret sauce. So if you’re following us, the first two are about the company, the third was the stock, then the next two, four, and five, the people and the brand are about the company. [00:38:30] Number six is about the stock. And it’s specifically that the stock is generally considered capital o overvalued by the, by the world at large, by Wall Street commentators by people in Barons, CNBC, never Bloomberg Radio

Barry Ritholtz: [00:38:45] Course. So a little, so a little contrarian perspective,

David Gardner: [00:38:47] We are specifically wanting people to call out Tesla as ridiculously overpriced. Amazon will never make money. Intuitive surgical, when I first recommended it over a hundred bagger ago, it was at 73 times earnings. There are people, if they even do pay attention to stocks anymore that say I would never buy a stock with a priced earnings ratio of 73. [00:39:06] The list goes on.

Barry Ritholtz: [00:39:07] So a lot of times when we see stuff, especially with a company that’s relatively young, you start to see the company grow into their valuation. And NVIDIA’s a great example. It was a semi maker then. It was a floating point chip maker for gaming before it did the pivot to full ai. [00:39:29] ’cause FPU are turns out to be better than CPUs for large language models. And I don’t pretend to be a wizard on that CPUs

David Gardner: [00:39:38] Than GPUs, graphic processing’s units.

Barry Ritholtz: [00:39:40] Yeah. I dunno what F is floating point unit, but GPUs, that’s exactly right. But, two years ago Nvidia was like a 75 pe. Now it’s like a 40 PE and falling can’t some of these overpriced companies just grow.

David Gardner: [00:39:58] Apple is another example. For the longest time people looked at Apple in the two thousands when that Newfangled iPod came out and said, oh they don’t have any profits whatsoever. Why would I wanna own Apple in oh four or oh five? [00:40:15] So I think that first of all, let’s be clear, there are things that are overvalued that you and I would not wanna buy. But if you’re following our conversation, if you’re buying a top dog and first mover in an important emerging industry with a sustainable competitive advantage, stellar past price appreciation, excellent management, smart backing, strong consumer appeal, it has all five of those things in place. And then some guy on CNBC is telling you it’s blatantly overvalued. It’s crazy. [00:40:43] No one should ever buy that stock. Amazon do bomb cover of Baron’s. That is the special sauce that causes me to say, bam. Now we’re buying and well the Amazon, it’s so contrary.

Barry Ritholtz: [00:40:54] The Amazon bomb was, I wanna say January, 2000. And we did see a giant collapse. What was the QS fell about 82% pizza trough. That’s a pretty

David Gardner: [00:41:05] Big block. I experienced it all the way. In fact, our cost basis 16 cents, it had gone up. It was a 30 bagger. [00:41:12] And again, when I’m picking stocks, this is not for my, this is not for my own portfolio. This is not, this is lots of people following the Motley Fool. This, these are people subscribing to us. So right. [00:41:21] When I pick a good stock, it feels really good. It’s not about me. When I pick a bad stock, it doesn’t feel very good. It’s not about me or a

Barry Ritholtz: [00:41:29] Big, a good stock that hits a buzz saw when a market gets shellacked. Exactly. And you could own anything during the financial crisis. Everything still got cut in half more or less. [00:41:38] It was quite a, quite a

David Gardner: [00:41:40] Crash. You’re right Barry. And the truth is that if you follow any of these companies, I’ve, I’ve littered our conversation with 15 to 20 company names that are really 15 to 20 generationally great stocks. Every single one of these stocks has lost 50% or more of its value more than once. [00:41:57] Which means that if you’d followed Motley Fool advice, depending on your timing, you might love me or not like me. You might be like, yeah I got in there but got cut in half and I got out. We’re holding all the way through. We’re buying and we’re holding. [00:42:11] So I have watched Amazon go, this is kind of pre-split. It was at three when we first recommended. It went to 95 down to seven during that two 2001 era I recall for sure.

Barry Ritholtz: [00:42:22] Incredible. More splits soon after. Yeah,

David Gardner: [00:42:24] Yeah. It’s now split down to 16 cents, which by the way is also my cost base is on Nvidia. Thanks to the magic of stock splits, they both got me at my 16 cent. Cost base is still holding. [00:42:34] So, but to do that like Nvidia just three years ago lost half. Its value in one year. This is one of the largest

Barry Ritholtz: [00:42:41] Companies. It was like four months in the it get cut in half. Yeah. Right.

David Gardner: [00:42:43] So

Barry Ritholtz: [00:42:43] This is just gonna happen.

David Gardner: [00:42:44] 2022, it really got [00:42:46] Shellacked. This is not gonna happen for companies that are not dynamic, this is not gonna happen so much for cyclicals. I mean there will be some cyclicality, these are rule breakers, these are stocks that by most popular view were blatantly overvalued. You should never have bought Amazon all the way through, et cetera. [00:43:02] And so they’re gonna be more volatile. Netflix was gonna get put outta business by Walmart. I don’t know if you remember this, but back in the day of the red envelopes, all of a sudden Walmart said, Hey, you can just drop it off at your Walmart, your DVD, you don’t have to mail it back to Netflix. That was gonna, Netflix was supposedly toast then. [00:43:18] So I’ve a OL was gonna be toast. It eventually was kind of toast, although it sold out the

Barry Ritholtz: [00:43:23] Merger was the problem. Yeah.

David Gardner: [00:43:24] But I’ve watched, it’s such a key indicator, trait number six when people say it’s toast that not for every stock, but for the rule breakers, that is magic. It has been for me.

Barry Ritholtz: [00:43:36] Huh. So I wanna ask you about the first stock you purchased where you said, oh this checks all six boxes. This is my rule

David Gardner: [00:43:47] Breaker. It was a OL. Yeah, definitely

Barry Ritholtz: [00:43:50] AOL 19 91, 4, 5, 6.

David Gardner: [00:43:52] We literally picked it the day we launched on a OL 1994, August 4th, 1994. And from that point I watched a OL and again we were, I mean we’re always fully transparent. People are like, wait, you guys are on a OL, is there a conflict of interest? You’re recommending AOL stock? [00:44:07] No, we know what it is because we’re on it. We see what this can do for investors and what the future of the company is. It’s pretty self-evident, you [00:44:16] Know, you’re right. And yet not everybody would’ve felt that way back then. But it was, I mean we had no inside view of a OL. We were separately domicile, but we watched a OL grow and it was such an object business lesson as an entrepreneur for me. [00:44:31] And, but as a stock picker, I was watching it get called out as the most overvalued stock repeatedly by August. Bodies like the world economic, it’s not the world Economic forum today, but basically all the economists in the world would get together every summer and two summers in a row. It was like 96 and 97. They voted the most overvalued stock and it was the stock that we had backed. [00:44:53] And our members were like, guys, they’re calling it the most overvalued again. We’re like, this is an amazing company. It went up 150 times in value. And I learned so much from that experience. [00:45:03] And as we mentioned, it didn’t end there. It started to drop back and fell back and eventually just kind of got taken over. And, it emerged with time Warner. When

Barry Ritholtz: [00:45:12] When people stop calling stuff over valued and every analyst on the street has a strong buy on it,

David Gardner: [00:45:18] That’s usually

Barry Ritholtz: [00:45:18] When you wanna be on the other side of that. Right. That

David Gardner: [00:45:22] Can, that can be true. I will also say though, not always, but No. I definitely appreciate the sentiment and I smile at that ance with you as well. I will say that we typically just hold, well longer than whatever analysts are thinking or saying. [00:45:35] We don’t really pay attention. So you’re not

Barry Ritholtz: [00:45:36] Quarter to quarter, is that what you’re saying?

David Gardner: [00:45:38] Not, yeah. No. I mean we love following business. By the way, one thing you asked me to think a little bit about is there anything that people should be talking more about, especially if something that troubles me. [00:45:48] And a quick example would be, I really think we should have companies reporting every three months their financial results. And you may know there’s a movement afoot. Yes. To allow some companies just to report twice a year. [00:45:58] I think that’s a really bad decision. And I hope we don’t do that. I hope companies will self-report and choose to be transparent on a regular basis with their results.

Barry Ritholtz: [00:46:07] Yeah, I’m gonna take it a step further than you and say, and I wrote this before AI was ubiquitous. If you want to get rid of quarterly reporting instead of going once or twice a year, make it real time and 24 7 really cool because you could update that. You could set up technology to update, here’s where we are, here’s how close we are, here’s our range. You can Monte Carlo what we would likely to do each quarter. [00:46:34] And so the problem is the focus on quarterly. If it was all the time, like you can look at your portfolio or your checking account 24 7, you shouldn’t, but you can. And it’s made, I remember in the nineties or in the two thousands, we would be printing stuff out, folding ’em up, sticking ’em in envelope, sending them out. And the quarterly report was a, when I was a junior, having to do that crap in the mail room, it was a big deal. [00:47:05] The quarterly report. Yeah. Now nobody really thinks about your portfolio quarterly. ’cause you can access it whenever you want.

David Gardner: [00:47:13] It’s kind of, I think it’s absolutely heading in the wrong direction. Yeah. Well [00:47:16] So more transparency is, the theme here. But, so for me, I think a lot about, what is gonna be in the best interest of armchair investors like me because Barry, we are, we’re individual investors and so I’m there representing anybody who is in an investment club or was given a portfolio of stocks and they’re trying to figure out how to make better decisions. And I think it’s so rewarding to pick stocks in a world where it’s increasingly called out as crazy talk to actually buy an individual stock.

Barry Ritholtz: [00:47:49] So we talked earlier about stocks like Apple and Nvidia, Netflix and Amazon that have all gotten cut in half repeatedly. How do you tell the difference between a stock that’s just going through, so sort of regular volatility versus GE got sliced in half. We look at, I’m not even talking about the Lehman Brothers or the WorldComs of the world, I mean just stocks that their best days are behind them. How do the difference between just a regular stumble and beginning of the end?

David Gardner: [00:48:23] Well, [00:48:23] First of all, I’d say you can’t know. it would be two headstrong of me to say, here’s what, here’s what you do, here’s how. So for me, I just like to keep my stocks in place and recognize some of ’em are gonna trip. I love horse racing metaphors and not every horse is gonna win the race. [00:48:39] Not everyone’s gonna make to the race. Some get out to great start and don’t finish well and I can’t always know. But by holding I allow the ones that clearly will win to win. So grandly, when you make more than a thousand times your money on Amazon or Nvidia, it doesn’t actually matter that you had some dogs in your portfolio. [00:48:57] So you can be wrong and that’s okay. ’cause being right is so much more valuable. I will also add though, to answer your question a little bit more directly, usually the companies that fall and don’t come back are being disrupted. Earlier I mentioned Clayton Christensen innovator’s Dilemma. [00:49:14] You can usually kind of see it that the world is changing. The company might still be best in class and it may have a famous CEO that everybody loves, but all of a sudden there’s this upstart might be a whole industry of new players. And when I see that in a company going down, I may not wanna hold onto that stock. But if Netflix, which has been ascendant now for 20 plus years, every time if it’s down two thirds of its value, which has happened more than once, including Quickster, I keep holding that one. [00:49:43] Right? So the question is, does this company remain a rule breaker? Is it a top dog and still first mover in an emergent industry? And when it is, I’m gonna keep holding that stock.

Barry Ritholtz: [00:49:54] Coming up, we continue our conversation with David Gardner, co-founder of the Motley Fool, discussing his book, rule Breaker Investing, how to Pick The Best Stocks of the Future and Build Lasting Wealth. I’m Barry Ritholtz. You are listening to Masters in Business on Bloomberg Radio. I am Barry Ritholtz. [00:50:27] You are listening to Masters in Business on Bloomberg Radio. My extra special guest is David Gardner. He’s the co-founder of the Motley Fool and the author of the book, rule Breaker Investing, how to Pick The Best Stocks of the Future and Build Lasting Wealth. When did you realize that Blockbuster was being disrupted by Netflix and ps? [00:50:50] At one point in the two thousands, Netflix tried to sell themselves to Blockbuster for $50 million and they turned them down.

David Gardner: [00:50:58] Yeah, it’s, it’s like Yahoo could have bought Google. You love those stories. Yeah, but, I would say that I never really thought too much about Blockbuster as a stock. I remember we had the CEO on our Motley Fool radio show, and at that time, blockbuster maybe had 25 million customers and Netflix had 1 million. [00:51:14] And he was like, we’re watching what they’re doing. It’s, it’s neat what they’re doing. I don’t think it’s a, it’s not a big scaling thing, right?, it’s kind of a niche thing. [00:51:22] Do you wanna mail your DVD back and forth? And that, I think it was John anco, but good man, probably, but wrong. He was wrong. And so it wasn’t so much that I ever cared or love Blockbuster, I just was watching this rule breaker emerge and it was doing crazy stuff. [00:51:38] Like you can’t just drop it off two blocks away at your blockbuster. You have to mail it and keep a queue and send it back and forth, but

Barry Ritholtz: [00:51:46] The queue is half the value of it. Here’s all the movies I wanna see, which, by the way, every time I roll into Blockbuster, it’s rented. And I’m not even talking about a Saturday night, like on a Wednesday. What do you mean you don’t have this? [00:51:59] Remember those

David Gardner: [00:52:00] Days? So instead just working through the queue, Netflix was like, so that the initial question is, wait, you want me to nail DVDs back and forth to, oh, I see how this works, but this’ll never replace Blockbuster to no late fees. Oh my God, why do I want to give anything to Blockbuster? And it was super disruptive before online streaming

Barry Ritholtz: [00:52:25] And as a, as a master of business administration. Actually, I don’t have an MBA neither, but I know I’m neither a master of business, God beautiful. But as students of the game, as people who love business, what actually was happening was Netflix was changing the business model of the consumer proposition and the whole industry, right? Because as you just pointed out, blockbuster was a transactional late fee driven, and all of a sudden you’re subscribing to Netflix, you’re now in a subscription relationship, very disruptive. [00:52:52] There was no, there was really no precedent for that in that industry. So it looked like this crazy thing, and it was easy to mock. Why wouldn’t you just drop it off a block away, mail it to these people? And yet it fundamentally changed the business model forever. [00:53:08] And then we’re not even talking about streaming, which we don’t have to, but they keep innovating. And, [00:53:11] And the interesting thing is, you men, we were mentioning late fees. if you get a late fee from your bank or a bounce check fee or something, it’s part of your statement. It’s not the same thing as showing up and having someone say, gimme another seven bucks. What do you mean give you another seven bucks? [00:53:31] It was just like so annoying it and alienating, like, I think it’s a good rule of thumb. Try not to really piss off all of your clients, all of your customers. Not a good long-term strategy.

David Gardner: [00:53:44] I have a small confession to make that Wall Street Summer, I referenced when I went to Solomon Brothers, we did, we had a video out from Blockbuster and we kept it the whole summer. We just kept not returning. We were irresponsible college sophomores. And at the end of the summer, I’m not even sure, like we had racked up a triple digit late fee,

Barry Ritholtz: [00:54:01] Right? And the video is 20 bucks to buy. Exactly. Just go buy another

David Gardner: [00:54:05] One. So we had a friend of ours who is British, go in with a British accent and explain to Blockbuster that we were renting his place. He doesn’t really know about it, but here’s this video that he found. And so we kind of got out of that one. [00:54:17] It wasn’t totally above board. So I’m happy now to admit that this is helpful for me. But yeah, that was kind of the state of things, the anxiety, the angst around returning a video late and not feeling great, from a consumer branding standpoint. Right.

Barry Ritholtz: [00:54:32] So yeah, Netflix love them. So, [00:54:34] So let’s talk about rule breakers today. They’re gonna be in different spaces, biotech, defense, tech, obviously ai, and a lot of these areas don’t have a whole lot of earnings or, and they do have a massive cash burn. So how do you think about valuation in the space? Does it not matter if the growth is there? [00:54:54] Define the modern era of rule breakers.

David Gardner: [00:54:58] So I would always be, first of all, looking at industries and you just did that some, and, even something like biotech, which you said, right? That’s, as, Barry, that’s multiple industries, right? there’s, there’s, so the internet was never an industry. AI is not in industry. [00:55:14] So we’re talking about, again, huge technologies. I was saying earlier, plate tectonic shifts for our society. And you’re looking for the beneficiaries and you’re looking for the visionaries who are starting something that might sound a little crazy, like mailing DVDs back and forth, or an electric car. And you wanna get invested in those. [00:55:33] Assuming that you agree with the vision, you think the person is great. You and I were referencing investment research circa 1980s, nineties, an annual report being mailed to you through the mail. That was about all you had. There weren’t online forms or anything these days. [00:55:47] You can watch long form YouTube videos watching any CEO be interviewed and learn a lot about their character, which carries, which matters deeply to me, I’m a big character person, so I wanna feel really good about the people I’m invested in across my portfolio. So we’re looking at important emerging industries, and we’re not trying to force things that don’t exist yet. There’s no ultra AI stock. Nvidia has been an amazing hold for us now 21 years in counting. [00:56:13] It was not an AI company when I first recommended it, but we’re still holding. But, these things are gonna emerge. I already mentioned earlier things like Uber, Airbnb didn’t show up till more than 10 years after the internet had really started to penetrate American life. And so for me, it’s just keeping our eyes out, whether it’s genomics or some Duolingo, a video game on your, on your phone where you’re learning languages. [00:56:42] Again, all of these are from different industries, but they are the innovator. And so yeah, we’re, we’re staying focused in the modern day go forward on what are the companies that are going to add value to our world in a way that is consumer noticeable, and when they’re called overvalued, that’s even better for us as rule breaker investors.

Barry Ritholtz: [00:57:01] So let me share some criticism that you share with Warren Buffett of all people, when I’m doing my research for this conversation. One of the things that came up was you have this really good long-term con track record, but if you’ve been involved in more recently, in the past 10, 15 years, well all those Amazon’s Netflix, apples from the early two thousands are driving most of your gains. From what I’m hearing from you’re implying that doesn’t really hold true. If you look at the Teslas and the Ubers and the more modern positions respond to that criticism, Hey, if you weren’t in it in oh three, you really didn’t get any benefit.

David Gardner: [00:57:43] I, well, first of all, I would say that invest every day of your life every two weeks if you can, young people, the first thing you should do is open an account if you haven’t already save. And with every paycheck, try to put up to 10% away and put it in if you want. You can index, but I think you should be buying stocks as well alongside that and learning as you go. And anybody who’s playing the long game in the markets as they start to hit their 30th or 40th year, which is where I am, it’s always gonna look like all your big winners we’re the first 10 years, because of course they are. [00:58:16] Literally, Amazon is now more than a thousand times of value for me. I’m not trying to be Amazon guy, you don’t walk me, you don’t see me walking around going, I’m the guy who had Amazon 16 cents. I also have that for Nvidia. But just by the nature of compounding Barry, which I think you understand as well as anyone, it’s always gonna look like all your big winners were early, but, whether it’s Tesla, Pickton, 2011 or Shopify in 2016, these are all rule breakers. [00:58:45] They’re not gonna hit right away. Shopify has been up and down, but mostly up. It’s a great example of a rule breaker circa the last 10 years, not the first 20 years, but I never want people to forget. We were right there at the beginning with a OL, and we were picking a OL and Amazon and Starbucks, by the way. [00:59:02] And the list goes on. So I would just say compounding numbers are always gonna make it look like all of your big winners are early in your career.

Barry Ritholtz: [00:59:10] So before I get to my favorite questions is just one question I’m excited to ask you when you’re looking ahead, what trends, what businesses, what ideas generally get your curiosity going?

David Gardner: [00:59:23] Well, this is, this is, and in the same way that seven Up was the uncola back in the day, this is an unanswer because by

Barry Ritholtz: [00:59:32] The way, you’re talking to a generation

David Gardner: [00:59:33] I know that

Barry Ritholtz: [00:59:34] Has no idea what that means.

David Gardner: [00:59:35] I but you and I do though. Yeah, course. And we got some of our peeps listening. Right. [00:59:39] For sure. So, yeah, I should have just answered the question. So I look for companies that are conscious capitalism kinds of companies. I want companies that first of all are doing good in this world by my perception. [00:59:56] A lot of people think it’s a trade off in life. They think capitalism is greedy and evil and, you’re abusing workers and it’s all about maximizing shareholder value. I completely disagree in many cases, sure that exists in the world, but that’s not the story of Amazon. Amazon is a big, beautiful, amazing enterprise that helps save lives during COVID. [01:00:15] And yes, they’ll get criticized for some of the things that they’ve done. And Jeff Bezos is considered an egomaniac by some. But net, please, Amazon is a huge value contributor. So that’s an example of a company, Reed Hastings and what he created at Netflix. [01:00:30] There’s a whole 80 page slide a lot of entrepreneurs have seen about how Netflix does culture that they just kind of shared out. And you could see why they’re so successful. ’cause how they treat their employees and the standards that they hold where doing good actually leads to doing well. And again, many people think that’s a trade off, or they don’t actually think that’s real. [01:00:49] So I specifically want you and I to make our portfolios reflect our best vision for our future. And so every company that I already like, invade against the entire industry, the gaming industry earlier, sorry, gamers, but by the way, I’m a gamer, but I play video games and board games, not 50 50, and the house takes 10% game. But I would say that you’re looking for the people who are doing good or within their industry, they’re admired for how they treat their employees, how they win for their customers, and how their partners and suppliers are proud to be associated with them. And guess what, usually the stocks end up outperforming in a world where many people think it’s too risky to even buy individual stocks. [01:01:28] So the more there’s big dumb money sloshing around out there, Barry, the easier it is for stock pickers like me, like you, if you like anybody listening to us, to actually pick and discern the good companies, hold them longer than Wall Street, longer than the headlines than CNBC will be talking about and do really well.

Barry Ritholtz: [01:01:48] So let’s jump to our speed round, our favorite questions. Love it. In the last five minutes we have, starting with, who are your early mentors who helped shape your career?

David Gardner: [01:01:57] So my father, who at the age of 18 said, here you go, David, I’ve been investing in this for you from birth. This is all you’re ever getting from me, really. And I’ve taught you how to value line that big black tome, the numbers of investing. And I know you love sports statistics. [01:02:12] Another of my mentors Bill James, the awesome baseball statistician, actually he was a journalist, but James who influenced Moneyball, of course, of course. So who I met before, but, these are early people who convinced me of the fun of life and that it could be counted with numbers. I’m an English major, but there’s a, there’s a big left brain going on with me with loving numbers and baseball stats and college basketball stats. Ken Palm, by the way, Ken Palm, that is a $25 subscription any sports fan would enjoy. [01:02:45] So the Peter Lynch, I’m thinking about Clayton Christensen, I mentioned. These are all people who really have helped me think about what wins.

Barry Ritholtz: [01:02:56] Look, you mentioned Moneyball. Let’s talk about books. What are some of your favorites? What are you reading right now?

David Gardner: [01:03:02] Yeah, so first of all, I’m reading right now the score by Teen Nen. And the score is an amazing, but I think the subtitle is something like How to Stop Playing somebody else’s Game. And Nen is a games philosopher. So people are, philosophers about ideas or art. [01:03:23] He specifically looks at games and his book talks about how social media, for example, is sort of a game. Like as soon as you start imposing likes and follows, you’re playing somebody else’s game. You’re playing Twitter X’s Game or Facebook’s game when you have to accept GPA as a measure of how well you’ve done in college, and it becomes big and bureaucratic and everybody’s using that. You are unfortunately playing somebody else’s game. [01:03:48] Sometimes you have to do it. But being self-aware of what is motivating you, it is an amazing book and I highly recommend this score. I’ve had Tina Nguyen on my podcast a couple of times, love the Guy. we just can’t geek at about board games. [01:04:04] But that’s what I’m reading right now. But, when I think about books, it’s a motley array of books,

Barry Ritholtz: [01:04:09] No pun intended.

David Gardner: [01:04:10] Barry indeed, I mean The Inevitable by Kevin Kelly’s a great book about the future. I’m a big Kevin Kelly fan. He founded Wired magazine. He’s a genius. [01:04:18] I enjoy Arthur Brooks’ columns in The Atlantic. He writes about happiness. I really loved his book. Love Your Enemies talking about the divisiveness in our country and how to solve that. [01:04:27] And I would love to see more of that. Stephen Pinker and all of his data accumulation around technologies, trends in our culture. It seems always to be smart, to be a pessimist. You always sound smarter when you talk something down. [01:04:42] And yet we’re pinch yourself that you’re living today. I know we have a lot of problems. We have many better problems. There were many worse problems in over human history.

Barry Ritholtz: [01:04:52] Stephen Pinker reminds us of that, right? [01:04:54] Our world in Data. Yep. Aunts Ling, same thing. There you

David Gardner: [01:04:57] Go, Barry. Exactly.

Barry Ritholtz: [01:04:58] And I was rudely using my phone to get the exact name of a book that I’m gonna recommend to you. ’cause it’s sitting on my desk and the author is Danny Font. Everybody loses. And it’s all about the tumultuous rise of American sports gambling and why it’s such

David Gardner: [01:05:18] A, I’m glad he wrote that.

Barry Ritholtz: [01:05:19] So I, it’s literally waiting for me to, it’s next up this giant I love it thing, but yeah, it’s writing your, writing your mo Yep. I mentioned earlier some streaming to, and we’ve been talking about Netflix and Amazon. So tell us, what are your favorite Netflix or Amazon Prime videos, or what podcasts are you listening to?

David Gardner: [01:05:43] Thank you. I really enjoyed Apple’s Pluribus, if you saw that. It’s

Barry Ritholtz: [01:05:48] Also in my queue next up.

David Gardner: [01:05:49] Totally. It looks great. Totally recommend that. That’s just season one. [01:05:53] We have a lot of British comedy fans in my family. So shows like Mitchell and Webb, the comedy duo, their clips are all over YouTube, but it crowd hilarious show streaming. Totally recommend that. Not as funny, but very British, all creatures great and small, just an absolute very interesting.

Barry Ritholtz: [01:06:11] The early [01:06:12] 20th century.

David Gardner: [01:06:13] Exactly. Just such a slow horses great show. Apple and, or sure. I love sci-fi, I love all the Marvel stuff, by the way. [01:06:21] Marvel’s been an amazing stock for me. It got bought out by Disney. That’s right. So these days we have a very low cost basis. [01:06:26] You couldn’t have gotten, because when Disney bought Marvel at a huge premium, we marvel shareholders, we happy few buying a rule breaker that looked overvalued. Right? We’ve ended up doing really well. So, but, and are obviously Star Wars and I love brands and I love family entertainment. [01:06:41] So those are some that come to mind.

Barry Ritholtz: [01:06:43] I just flew back from San Francisco and on the flight I re-watched Deadpool and Wolverine and it’s like, I forgot how much fun that movie was. Yeah. Really a blast. Our final two questions. [01:06:55] What sort of advice would you give to a recent college graduate interested in a career in investing?

David Gardner: [01:07:01] Well, I would first of all say that you should pick individual stocks and you should pay attention to the game. And you should love it. You should have a lot of fun. I love sports. [01:07:10] We’ve talked, I know you do too. We’ve talked about that a lot. People follow their sports teams day to day. I follow the markets day to day. [01:07:17] And the difference is, you actually can make serious money by learning and following the market in a way you never will. As a sports fan. And I love sports and, sports can be a little bit more fun day to day, but the markets are open every day. Your NFL team only plays on Sundays and starting to figure out what wins in the marketplace and why is that app on your phone, not somebody else’s app? [01:07:37] What’s in your fridge? What are you wearing? Noticing the things that go on around you. This is gonna lead to riches, but it’s also gonna open your mind to awareness of what’s happening in our society. [01:07:47] And I do think that people who are taught to index and not really care are kind of walking blind in society when they could be poking their feelers up, seeing what’s happening in genomics or robotic surgery or whatever. And I’m an English major and I care about these things and profiting as a consequence. I would also say to any young person, start investing yesterday.

Barry Ritholtz: [01:08:08] And our final question, what do about the world of investing today might have been useful back in 1993 when you were first getting started?

David Gardner: [01:08:16] I would just say that when I first got started in 1993, investing was more of a math exercise for me. I was taught by a dad. I mentioned value line, lots of ratios that we know. I never learned financial statements until I bought how to read a financial statement the year after I graduated college thinking, I kind of missed that. [01:08:35] I never really did that. And so I was very numerically driven. I think what I’ve realized is that using your right brain in a world where many people are just using their left brain is where the real values added. My favorite chapter in my rule breaker investing book points out that most of the things that win in business are not actually on the financial statements. [01:08:58] We’ve already talked about a few of them who’s running the company? That is incredibly important. How about the brand value of a company? Most of those are never expressed anywhere in the financial statements. [01:09:07] The culture of the company. Can it innovate? Those four things are the bedrocks as an entrepreneur. I know I see it in my own company. [01:09:14] When we fail and when we succeed, none of those is being captured in the financial statements and we’re living in a left brain driven algorithmic world. And so I think here now I see, and I only think longer term than I ever did before when I was 30 years ago, I think longer term today at the age of 59 than 29. And I use my right brain, huh.

Barry Ritholtz: [01:09:34] David, thank you so much for being so generous with your time. This has been absolutely fascinating. We have been speaking with David Gardner. He is one of the co-founders of the Motley Fool and author of the book. [01:09:48] Let’s see if I can spit this out. Rule Breaker investing, how to pick the Best Stocks of the Future and Build Lasting. Well, if you enjoyed this conversation, well check out any of the 627 we’ve done over the past dozen years. You can find those at YouTube, Spotify, apple, Bloomberg, wherever you get your favorite podcasts. [01:10:13] I would be remiss if I didn’t thank the crack team that helps these conversations come together each week. Alexis Noriega is my video producer. Sean Russo is my researcher. Anna Lucas, my podcast producer. [01:10:28] I’m Barry Riol. You’ve been listening to Masters in Business on Bloomberg Radio.

 

~~~

 

 

 

The post Transcript: David Gardner, Co-Founder, The Motley Fool appeared first on The Big Picture.

My TACO Tuesday morning train reads:

•  See How the Energy Crisis Is Spreading Across the World: A WSJ visual breakdown of how the latest energy crunch is rippling across electricity, gas, and oil markets — and which countries are bearing the brunt. (Wall Street Journal)

•  Farmers Are Pairing Solar Panels With Livestock — and the Results Are Turning Heads: An Oregon project running sheep underneath solar arrays is delivering gains for both the ranchers and the panels, adding to the case for “agrivoltaics” as a way to defuse rural opposition to utility-scale solar. (The Cool Down) see also Unfounded Health Concerns Are Powering a Solar Backlash: ProPublica on how fears about solar farms — most without scientific support — have driven a wave of local bans and permit fights across Michigan and beyond. (ProPublica)

• It’s the Age of Electricity and America Isn’t Ready. Data centers and the power needs of artificial intelligence are actually a small part of a much bigger problem. Our grid is too old and our supply of electricity too small. If we don’t meet this moment, we will face an impoverished future of more expensive, less reliable energy, and slower economic growth. In a worst-case scenario, we could see Americans defect from the grid entirely, raising costs for everyone. Something needs to change now. (New York Times)

•  Robotaxis Are the New Millennial Lifestyle Subsidy: Waymo and the rest of the robotaxi field are still pricing rides well below cost — effectively turning urban millennials into the next generation of subsidized lifestyle-tech consumers, the same playbook Uber and Lyft ran a decade ago. (Sherwood)

•  Reading Palantir: Why the defense tech giant’s manifesto may signal panic inside the company: The more grandiose the manifesto, the shakier the underlying business. A close textual reading suggests Karp doth protest too much. The war tech firm is suffering from a lethal combo of stock price superinflation and midterms anxiety (Gazetteer)

• They Dared to Leave Merrill Lynch. How These Top Advisors Became Wall Street Renegades. When a group of financial advisors quit to open their own firm, their departure sparked a wave of resignations at Merrill—and a marathon effort to win over clients and $129 billion in assets. (Barron’s)

• ‘Wagyu’ Used to Guarantee Quality Beef. What Are You Paying for Today? Behind the scenes, competing forces battle for the’ (New York Times)

•  US is being ‘humiliated’ by Iran’s leadership, says Friedrich Merz: Germany’s chancellor weighs in with rare bluntness on Trump’s Iran posture. The allies aren’t impressed, and Merz isn’t bothering to hide it. (The Guardian) see alsoTrump Seeks to Abolish Iran’s Atomic Stockpile, a Problem He Helped Create: The man who tore up the JCPOA now demands Iran dismantle the stockpile that grew because of it. A fitting policy ouroboros. (New York Times)

• Can A.I. Determine Which Artist Made a Painting? This New Brushstroke Detection Tool May Have Solved a Mystery About El Greco. While debating the authorship of “The Baptism of Christ,” one of El Greco’s final works, art experts long relied on their own analysis of brushstrokes. A new study tapped artificial intelligence to peer at the paint at a microscopic level (Smithsonian Magazine)

• Season From HeLLLLLLLLLLLL: Miserable Mets Can’t Stop Losing: After 12 straight defeats, surrender flags are out for the mega-payroll New York club. Obviously, it’s the mayor’s fault (Wall Street Journal)

Be sure to check out our Masters in Business interview this weekend with David Gardner, cofounder of The Motley Fool in 1993 (with his brother Tom Gardner). Originally launched as a print investment newsletter based on the idea that ordinary investors could beat Wall St., it gained traction when promoted on America Online (AOL) in 1994; it soon became a major presence on AOL and then Fool.com. His latest book is “Rule Breaker Investing: How to Pick the Best Stocks of the Future and Build Lasting Wealth.”

 

Despite a lot of fear mongering, over the past 3.5 years, the market has doubled

Source: @ryandetrick

 

Sign up for our reads-only mailing list here.

 

The post 10 Tuesday AM Reads appeared first on The Big Picture.

Iran Already Scrambling For Oil Storage After Two Weeks Of US Blockade

Trump's blockade is having a predictable effect on Iran's economy and oil industry, with reports that the regime is scrambling to repurpose old and rusty tankers as floating storage.  Kharg Island is hitting capacity and the results could lead to disaster for Iran's oil wells. 

The regime is reportedly moving to expand crude storage at the island, where around 90% of their energy exports are processed, by reactivating a 30-year-old crude carrier called M/T Nasha.  It's a bad sign for Iran, indicating that the country’s main oil hub is nearing its onshore storage limit.  Maritime analysts say the vessel, which had been anchored empty for years, is being repositioned as floating storage to absorb crude that still has to move out of the system. 

To prepare for the possibility of running out of oil storage space at Kharg Island, Iran has brought NASHA (9079107) out of retirement. She's a 30yo VLCC that's been anchored empty for the past few years; currently spending 4 days on a trip that should take 1.5–2 days. #OOTT pic.twitter.com/jFhq2xP0mU

— TankerTrackers.com, Inc. (@TankerTrackers) April 23, 2026

But how much time will decommissioned tankers buy Iran?  Current estimates indicate Kharg Island has roughly 13 million barrels of spare onshore storage remaining at the terminal, while net inflows are running at about 1.0 million to 1.1 million barrels per day.  At that pace, storage could be filled in about 12 to 13 days, which places the saturation point in late April to early May if current flows hold.  A large tanker gives them another potential 2 million barrels of capacity.  In other words, not much. 

This data is a near match to JP Morgan's recent assessment that Iran has between 20 - 26 days of capacity (including emergency measures) before they hit the wall and are forced to shut down their oil fields. 

Trump's assertion on Sunday that Iran's oil infrastructure may "explode in three days" due to the blockade might be a bit optimistic, but with the threat of overcapacity it is likely that the Iranians will be forced to the negotiating table in the near term.

The regime's only other option is to divert the oil away from Kharg to the Jask Oil Terminal at Kooh Mobarak using the Goreh-Jask pipeline.  But this storage is limited and may already be full.

There are also limited reports that Iran is increasing "flaring" at wells to burn off excess.  To keep wells operating safely (avoiding sudden shutdowns that can cause permanent geological issues), operators are flaring off excess associated gas (and possibly some liquid byproducts) at a heightened rate.

If wells are forced to shut down due to lack of storage, this could cause permanent damage and render the wells unusable in the future.  Recovery is expensive and difficult. 

If the current data is accurate, then Iran has approximately two more weeks before their economy is destroyed.  Loss of $430 million per day in export revenues aside, permanent damage to their oil fields would result in a long term economic disaster. 

The danger of well shutdowns is probably the reason why the regime has offered new proposals every few days to open the Strait of Hormuz, though, they continue to call for a separate negotiation on their estimated 970 pounds of enriched Uranium stockpile. 

There is little incentive for Trump to lift the blockade at this time, given the amount of leverage he will have over the Iranian economy if he maintains restrictions on their oil exports for another two weeks.  The regime is trapped between a rock and a hard place, and will have to decide soon if their oil wells are more important to them than their Uranium.      

Tyler Durden Tue, 04/28/2026 - 05:45

12-Year-Old French Girl Collapses After Judge Releases Men Arrested For Gang Raping Her In Airbnb

Via Remix News,

Two young men, both adults, suspected of gang rape in an Airbnb in the France’s Décines-Charpieu (Rhône), have been released from custody, shocking the family of one of the victims.

The victim’s lawyer, David Metaxas, spoke on behalf of the victim’s relatives, who told LyonMag that the judge’s decision was “incomprehensible.” Not only have both men been released to roam freely in the streets, but the judge did not even issue a restriction on contact with the victim, which means the two men could approach her once again.

Last week, the two men, aged 20 and 21, were arrested for the rape involving the 12-year-old, as well as a 16-year-old girl who had allegedly led the younger victim to the apartment. After reportedly exchanging messages with the two young men via Snapchat, the teen encouraged her younger friend to come with her to the Airbnb. Alcohol and drugs were allegedly consumed, with an excessive amount of hard liquor given to the 12-year-old.

Falling unconscious, the younger victim recounted waking up “lying on a bed covered in blood,” before realizing what had happened, recounts Lyon Mag. It was when she turned her phone back on that her mother was able to geolocate her, allowing the police to intervene. She is said to have run away from her home in Givors before the incident.

However, now the perpetrators are free. The family of the 12-year-old says her safety and innocence were tossed aside from the get-go, with police allegedly not even asking her to file a complaint initially.

“They were very poorly received, as if they were a nuisance,” said David Metaxas, the lawyer representing the 12-year-old. He pointed to a total lack of support and guidance, adding the very obvious and visible signs of rape suffered by the young girl.

“It is unacceptable that the form to file a complaint was not given to them by the police. It must be remembered that they were dealing with a young girl who had been deflowered, anally and orally penetrated, and who had wounds all over her body.”

Unfortunately, the 16-year-old girl and the accused men all stated that the girl was consenting. “Everyone agrees that she was consenting, or even that she was provoking, even though she is 12 years old and was completely drunk to the point of losing consciousness,” he said, adding that at the hearing, the girl was in an advanced state of shock.

“The lack of coercive measures concerning the suspects […] is incomprehensible,” stated Metaxas, the lawyer representing the 12-year-old, as quoted by LyonMag. He added that the court has failed to demand any judicial supervision or even a restraining order on the alleged perpetrators.  

“They can, if they wish, contact and visit the young girl whenever they want,”  he warns.  “Therefore, there is total incomprehension, not to mention anger, on the part of the family.”

As for the young victim, she allegedly collapsed in the lawyer’s office upon hearing of the decision and was taken to the hospital. “She is in a state of total shock. She couldn’t utter a single word in my office. The justice system needs to take charge of this case very quickly,” he stated.

Metaxas insists he will not let the matter be and will be asking the public prosecutor that “a specialized service be put in charge of the investigation with the implementation of coercive measures to ensure the safety of this minor.”

The two men are still under investigation.

Read more here...

Tyler Durden Tue, 04/28/2026 - 05:00

Pentagon Investigates Mystery Fire At UK Base Used For Bombing Iran

The US Air Force has reportedly opened an investigation into a fire that broke out over the weekend at RAF Fairford in the UK. Crucially, it is a key US-allied base hosting a US bomber unit carrying out strikes on Iran as part of Trump's Operation Epic Fury.

The fire started early Sunday inside an "old or disused building" at the airbase, a UK defense ministry spokesperson has said. The Pentagon is investigating alongside local partners: "An investigation has been initiated and is ongoing. More information will be released as it becomes available," a statement said.

source: The Telegraph

No injuries have been reported and officials said the blaze was quickly continued, with no further threat posed to the base and surrounding community. But it was clearly very large at one point, video evidence shows.

The US was permitted starting in March to use the base for Iran-related operations. The Telegraph describes further of the fire:

Several crews were deployed to the incident at RAF Fairford in the early hours of Sunday morning.

Footage taken overnight appears to show smoke billowing from what is claimed to be the base’s commissary, a shop that provides food and equipment. Other pictures from the scene show that the building’s roof collapsed as firefighters brought the blaze under control.

Authorities are suspicious there may have been some kind of act of sabotage at the base, given widespread local opposition to its us by American forces to bomb Iran.

There's also been chatter of Irani-linked 'terror cells' in Europe. According to more from The Telegraph:

While some welcomed the arrival, there had been protests against the decision, with around 200 people gathered at the base on Saturday. Protesters held signs that read “No war on Iran”, “US out of British bases” and “Stop Trump’s deadly wars”.

The use of RAF Fairford halves the time US bombers need to spend in the air. Sir Keir Starmer’s decision to allow US troops to use the base prevented what would have been a 37-hour round trip from Missouri to Iran.

RAF Fairford remains among the few European bases capable of supporting long-range US bombers such as the B-52 and B-2, and thus is an important staging and logistics hub for the Pentagon.

Major fire reported at RAF Fairford overnight, a British airbase hosting a sizeable forward-deployed contingent of USAF bombers for Iran strikes.

The fire reportedly gutted a commissary building. pic.twitter.com/cveufpjC1t

— OSINTtechnical (@Osinttechnical) April 26, 2026

Tensions have of late been strained between the US and UK over the Iran war, with PM Starmer dealing with a lot of domestic opposition, and Trump at the same time pressuring him to do more alongside the US in Iran and the Hormuz Strait.

If the fire was indeed arson, European authorities will likely look at the potential that it could have been Russia-linked, given widespread allegations of Moscow-backed sabotage operations in Europe and the UK, throughout the Ukraine war.

Tyler Durden Tue, 04/28/2026 - 04:15

NATO Minus US: European Militaries Won't Add Up To Deter Russia

Authored by John Haughey via The Epoch Times (emphasis ours),

The North Atlantic Treaty Organization’s European nations would need to bolster standing militaries by at least 300,000 troops and significantly boost defense spending beyond 3.5 percent of gross domestic product - at least 250 billion euros - while reviving and integrating their industrial base to defend themselves against Russia without the United States.

And they’d need to do that fast, according to a 2025 joint analysis by European think tanks Bruegel and the Kiel Institute for World Economy.

They warn that even with 80,000 American soldiers and airmen stationed on 30 bases on the continent—and the United States’ capacity to rapidly deploy forces—Moscow will test NATO’s resolve “within three to 10 years.”

The once-inconceivable prospect of the United States withdrawing from NATO is now a possibility. President Donald Trump—never a fan of the 32-nation coalition the Pentagon has spearheaded since 1949—has called for a “very serious examining” of the alliance, after its members failed to respond to his appeal to assist in the Iran war or join the U.S. Navy’s Arabian Sea blockade of Iranian shipping. 

Trump has vowed Europeans could face a “reckoning” without American leadership and support. Such a departure would require unlikely congressional approval, but the president’s statements are sparking discussion on both sides of the Atlantic about a restructuring of the alliance that would require Europeans to shoulder more of NATO’s burden.

As widely reported, European allies are actively discussing and preparing for a “NATO minus U.S.” scenario. The idea originated in response to Trump’s demand for Europeans to bulk up support for Ukraine in fighting off Russia’s invasion, his threats to seize Greenland from Denmark, and his characterization of member states as “cowards” unlikely to uphold NATO’s commitments.

While Americans have questioned NATO’s post-Cold War resolve since former President Barack Obama’s administration, Europeans in turn have questioned Trump’s reliability in meeting treaty obligations. 

In response to Trump’s demand that NATO allies commit 5 percent of GDP to defense, members agreed during the alliance’s 2025 summit to commit 3.5 percent to their militaries—roughly matching the percent of GDP the U.S. spends on its armed forces—and 1.5 percent for infrastructure improvements, such as cybersecurity, crisis response, and adapting roads, rail lines, bridges, and ports to military needs.

Ukraine’s Prime Minister Denys Shmyhal (L) and NATO Secretary General Mark Rutte address the audience during a press statement at the NATO headquarters in Brussels on Oct. 15, 2025. Prodding by the United States to be more self-reliant in continental defense was already an urgency in most European capitals after Russia’s February 2022 invasion of Ukraine. Nicolas Tucat/AFP via Getty Images Muscle and Money

The Bruegel/Kiel Institute analysis documents Europe’s armies have a combined force of about 1.5 million troops. In order to withstand a hypothetical Russian invasion, a European-only force would need 300,000 more infantry soldiers, or roughly 50 more brigades, than it had in 2025. It would need a minimum of 1,400 tanks, 2,000 infantry fighting vehicles, and 700 artillery pieces with more than 1 million 155 mm shells—the minimum for three months of combat, the Bruegel/Kiel Institute analysis states. 

That boost in manpower and armaments would exceed the current French, German, Italian, and British forces combined.

And that’s just ground forces.

To match Russian war-footing military production—even with Ukraine attrition—a Europe-only military would need collective arms procurement, common armaments, unified logistics, and integrated military units. Such an army would need to replace stationed U.S. forces and rotational deployments within the 65-mile Suwalki Corridor between Poland and Lithuania, while also establishing bases in Moldova and Romania.

These are but a few of the challenges a “NATO minus the U.S.” would face, military analysts and international relations scholars told The Epoch Times. And as Europeans by necessity assumed a more robust posture on the continent, American forces would need to compensate for the loss of specialties and skills brought by their European allies.

French soldiers dismantle a drone during the Dynamic Front 26 exercise in Cincu, Romania, on Feb. 9, 2026. In response to Trump’s demand that NATO allies commit 5 percent of GDP to defense, members agreed during its 2025 summit to commit 3.5 percent to their militaries and 1.5 percent for infrastructure improvements. Andrei Pungovschi/Getty Images

“Non-U.S. NATO forces are well-trained and have some highly competent defense manufacturing industries,” said University of Miami professor of politics June Teufel Dreyer, a senior Foreign Policy Research Institute fellow and former U.S.–China Economic and Security Review commissioner. 

European giants such as Thales and Leonardo would “surely be attracted by the idea of more indigenous investment,” Dreyer said. But, she added, European defense contractors “also know the funds they need aren’t guaranteed” without orders from the U.S. military to, for instance, annually build 2,000 “long-range loitering munitions”—drones—to match Russia’s numbers.

“The French and the Germans build highly thought of diesel-electric submarines; Sweden produces great fighter planes,” Dreyer said.

But from a nuclear deterrent perspective, a U.S. departure from NATO is problematic. Dreyer pointed to British Prime Minister Keir Starmer’s June 2025 announcement that Britain would buy at least 12 U.S.-made F-35s to “enhance the interoperability of NATO defense” in its nuclear posture, since these jets would be the UK’s only nuclear deterrent beyond its submarine force. The stealth fighter is the first to carry both conventional and nuclear weapons.

U.S. and European allies’ coordination in defense procurement and production “saves money and the R&D costs for the most advanced weapons,” she said, noting while the projected cost for the sixth-generation F-47 is $4.4 billion, but it is a shared NATO expense.

U.S. Air Force Chief of Staff Gen. David Allvin speaks alongside President Donald Trump in the Oval Office on March 21, 2025. Trump announced F-47, a sixth-generation fighter intended to replace the F-22 Raptor, for the Next Generation Air Dominance program. Anna Moneymaker/Getty Images Specialties and Skills

If NATO ties are severed, the United States will no longer benefit from what retired Navy captain and Epoch Times contributor Carl Schuster calls “amazing capabilities that may prove essential in any conflict.” Those capabilities include aircraft and ship design, special ops, and regional know-how such as mountain operations capabilities and Arctic warfare expertise. 

However, many European military assets are aging, and it was only after Russia’s invasion of Ukraine—and Trump’s threats to pull the United States from the alliance—that leaders showed urgency to address the deficiencies, Schuster said.

He expressed doubts about Spain—which has refused to let the United States use bases on its mainland to attack Iran—and Turkey. 

“Spain has rejected any idea of its ground and air forces being committed to combat outside Spanish territory,“ he said. ”So their contribution to NATO defense is more statistical than real.”

Turkey has the alliance’s largest ground force, yet its “willingness to contribute to the defense of Greece, Bulgaria, and Eastern Europe” may be questionable, he said.

Middle East Forum Director Gregg Roman also questioned Turkey’s NATO commitment, in a September 2025 column in The Epoch Times, calling for “an urgent compartmentalization assessment” after Turkey made overtures to China and Iran during the Shanghai Cooperation Organization (SCO) summit. 

“Six months later,” he said in April, “that assessment is non-optional. You know, thinking about everything [NATO] is trying to put together—joint air missile defense planning—with an ally like Turkey that is functionally aligned with Iran and the [SCO] bloc that we’re opposing, they can’t be trusted."

Read the rest here...

Tyler Durden Tue, 04/28/2026 - 03:30

Zelensky Charges Russia With 'Nuclear Terrorism' On 40th Chernobyl Anniversary

President Volodymyr Zelensky led Ukraine in a Sunday ceremony marking the 40th anniversary of the Chernobyl nuclear disaster, and used the occasion to call on the international community to take decisive action against what he called ongoing Russian "nuclear terrorism".

There were various candlelight remembrance ceremonies in cities across Ukraine, and in the capital. Later echoing the statement on Telegram, Zelensky alleged the the Chernobyl site's the New Safe Confinement structure - built with support from more than 40 countries - is under direct threat from Moscow’s aggression.

IAEA/X

The 1986 explosion and Chernobyl core meltdown is widely considered to be among the largest man-made disasters in human history. Zelensky has been hyping that another could be around the corner given Moscow's latest actions.

"Russian-Iranian Shahed drones constantly fly over the station, and one of them hit the confinement last year," Zelensky said, warning that another disaster could be imminent. 

"The world must not allow this nuclear terrorism to continue, and the best way is to force Russia to stop its reckless attacks," he then emphasized.

He described that protecting the Chernobyl site serves global interests and that the only way to guarantee safety is to force Russia to "stop its mad attacks."

The warning followed a major aerial assault on Saturday in which Russia launched over 660 missiles and drones at Ukraine, targeting cities and areas nationwide, including strikes on civilian infrastructure in Dnipro and Kharkiv.

Various international organizations say extreme danger for disaster persists, but Rosatom insists it has safety under control:

The head of the International Atomic Energy Agency (IAEA), Rafael Grossi, and Moldovan President Maia Sandu joined the commemorative events.

Commenting on damage to the shell, which the environmental group Greenpeace says raises the risk of a radioactive leak, Grossi said that "repairs should start as soon as possible and that leaving the situation as it is now is problematic."

Any repairs to the massive metal outer structure, which may potentially take up to four years, are virtually impossible due to Russia's invasion, according to Greenpeace.

Russia's nuclear agency Rosatom, the successor of the Soviet atomic energy ministry, which managed the facility, said: "To remember Chernobyl means to remember the people who bore the brunt of the disaster, and to take that experience into account in every decision we make today, to prevent a similar catastrophe."

There was a very alarming 2025 incident where an explosive drone hit the protective containment shell of the defunct Chernobyl plant. However, emergency crews were able to make it to the impact site on the immense roof and make repairs. Both the Ukrainian and Russian sides pointed the finger at the other for that attack.

Today marks 40 years since the Chernobyl disaster. On April 26, 1986, at 1:23 AM, a routine safety test spiraled into the worst nuclear disaster in history. pic.twitter.com/ioZFHTTNHh

— World of Engineering (@engineers_feed) April 26, 2026

Given that Chernobyl is a name that has captured popular imagination for decades since the apocalyptic historic disaster left the vicinity basically a radiation death zone, it could present the perfect false flag opportunity for anyone wishing to prolong and escalate the war - and nuclear officials have been keenly aware of this possibility.

Tyler Durden Tue, 04/28/2026 - 02:45

Orbán Vs Magyar: Did The EU Get Played?

Authored by Arthur Schaper via American Greatness,

Viktor Orbán, the valiant populist, the restorer of the Christian faith in Hungary, the welcome thorn in the side of the EU establishment, and the strong ally of President Trump since his first bid for office, has lost his own re-election bid. I had a feeling it would come to this.

Sixteen years of uninterrupted administration as a strong force for conservative, right-wing nationalist populism have come to an end, at least with Orbán as the head of it.

Sometimes, voters have a strange fatigue when it comes to governments. Fourteen years of a “conservative” UK government ushered in the Labour Party in 2024. However, fatigue doesn’t explain Orbán’s crushing loss.

What set that off?

Corruption charges and the argument that his administration had looked the other way when sex abuse scandals broke out at a local school.

Economics reared its ugly head, as well, since the EU was cutting off its funding. Orbán’s supposed lack of judicial reforms, as well as his uniform check on EU policy, frustrated Brussels.

Orbán faced a crisis election, and inviting US VP JD Vance to campaign on his behalf didn’t help.

Why would Hungarian voters care what a foreign politician thinks? This desperate move only exacerbated how out of touch the Orbán government had become. Critics also saw him as too close to Russian “president” Vladimir Putin and unhelpful in resolving the Russo-Ukrainian war. The EU had been waiting for this opportunity: an unpopular Orbán facing electoral collapse.

They were salivating for a post-Orbán Hungary, one that would stop its Christian restorationism, welcome more LGBT promotion, tolerate more spending, and open its borders.

Would the Orbán replacement accomplish their scheme?

His challenger, Péter Magyar, was trained and prepped as an Orbán acolyte.

In 2024, he broke from his party, but not over core policy. Magyar (whose name means “Hungarian,” for what it’s worth) campaigned to end corruption and restore good government in Hungary. He campaigned to the right of Orbán, calling for an end to importing cheap labor into the country. He campaigned on cracking down harder on immigration—illegal and mass—than the incumbent.

His message, if anyone was listening, wasn’t pro-EU. He was still asking the question: “What about us Hungarians?”

Supporters of the cultural restoration Right thought that Orbán was not getting the job done. Was he failing?

April 12, 2026, Magyar’s Tisza Party swept the elections: supermajority status, up to 140 out of 199 seats. Orbán won 56 seats, and another far-right party won the rest.

Sure, EU progressive elites celebrate Orbán’s loss, as did Barack Obama and George Soros. They view the downfall of Orbán as a harbinger for the end of Republican hegemony in Washington later this year.

Yet look again at the results of the Hungarian parliamentary elections. I mentioned three parties that won seats: three right-wing parties. Not one left-wing or centrist element came to power or won seats. A minimum threshold of five percent in the election results is required for a party to place. The left was shut out of the Hungarian Parliament.

The Right Wing won Hungary. Orbán may have lost his premiership, but Orbánism is standing strong.

This election focused on personalities, not principles.

Magyar is just as socially conservative as Orbán. He has already pledged to end the foreign permit workers. He wants to give Hungarians in other countries a chance to come back to their own country and thrive again. That’s about as “Hungary First” as it gets!

Magyar has already stated that he will not support fast-tracking Ukraine’s membership into the EU. Huge move for ending the Russo-Ukrainian war!

He announced a diversification plan for energy. Instead of relying predominantly on Russia, he wants to draw oil from the South and the West, as well. This sounds like real economic freedom for Hungary. National populism is great, but it must face economic realities. Too many right-wing populist governments are shoveling out money to voters for school supplies, raising families, and pensions. Where is the money supposed to come from? More taxes?! From whom?

Right-wing socialism is still . . . socialism, and Orbán had a problem here.

Eventually, the government runs out of others’ money, or inflation bites whatever purchasing power the government intended for the people. Inflation and tariff pressures weighed down Orbán’s reelection chances.

Orbán’s Hungary was still not the perfect social conservative paradise for other reasons. Prostitution is still legal. Abortion is also still legal. While countries need to encourage their native populations to bear children, that vision will collapse in the face of easy sex and no responsibility. Cultural norms need reinforcement, with no tolerance for deviance.

Orbán and his party imposed vaccine passports and health mandates during COVID. How is this good for the working public? Where is the freedom? Too much state-sponsored anything is bad for a country.

Even now, Hungarians cannot own a gun without passing strict government demands. Czechia made self-defense a right, and in Switzerland everyone owns a gun (though it’s registered with the state).

Throughout his tenure, Orbán strengthened ties with China, joining the deceptive Belt and Road initiative. He even allowed Chinese police to operate in his country! American citizens voiced righteous outrage when the local press exposed former New York City mayor Eric Adams for allowing a CCP-run police station in the Big Apple. Yet no one on the Right complained about Orbán allowing CCP Hungary? That’s wrong.

There’s room for improvement, and Magyar has the opportunity to exceed Orbán’s victories while correcting his mistakes.

He is already doubling down on stopping mass migration!

He is committed to putting all Hungarians first, and he is fighting for the rights of ethnic Hungarians in other countries.

Magyar must revive and restore Hungary’s economy. One can hope he will place his country in a better position to profit without dependence and root out undue Chinese influence.

In a media masterstroke, he appeared on state television to discuss his plans for the country. Without missing a beat, he dressed down the reporter interviewing him, castigating the news organization for not allowing him on their program over the last year and a half. He then scolded them for lying about him and his family.

Then came the coup de grace: he announced his government plan to cut their funding and shut them down. Hungary needs honest independent media, he said, not government-funded agitprop that would inspire envy in Joseph Goebbels or North Korea.

He is not hostile to Putin, but he will not engage him aggressively either: sounds a lot like Trump!

He will not participate in the EU migration pact. He is keeping up the border fences, but he has also pledged to find a way for the EU to release the funds that the country needs, too.

He is making inroads with his Slavic neighbors, including the more populist, nationalist leaders in Slovakia and Czechia.

Magyar reminds me of Florida Governor Ron DeSantis. He isn’t just talking the national populist talk. He is walking the walk, and he is sprinting ahead with major reforms.

Orbán was T-800. Magyar may well be T-1000, and the EU Left is going to find that he will be worse for their globalist, leftist, secularist agenda.

Tyler Durden Tue, 04/28/2026 - 02:00

America: Land Of The (Not Really) Free

Authored by Ron Paul via the Ron Paul Institute,

Two weeks ago, President Donald Trump commemorated income tax payments being due by having DoorDash deliver food from McDonald’s to the White House. The delivery was intended to highlight the first year of tax-free tips. Removing tax on tips was part of the 2025 Big Beautiful Bill (BBB).

As the sponsor of the first No Tax on Tips legislation introduced in Congress, I was obviously pleased to see this change in tax laws included in the BBB. The bill also included other good tax changes such as removing tax on overtime and extending the 2017 tax cuts. Unfortunately, the bill also increased federal spending and debt.

Supporters of the income tax implicitly endorse the idea that our rights are gifts from government and, thus, can be revoked by government at the will of our rulers. Adoption of the income tax signified the abandonment of the belief that individuals have inalienable rights granted them by the Creator.

Therefore, those who believe in natural rights must reject income taxation. It is also a violation of the people’s rights when the central bank reduces the value of the dollar, and thus the people’s purchasing power, via the hidden inflation tax.

The income tax system’s rejection of natural rights is exemplified by withholding that gives government first claim on an individual’s earnings. The government then may return, via what it calls a refund, some of what was taken. However, a normal refund is when a business returns a customer’s payment because the customer is dissatisfied with the good or service he received, not when a thief returns some of what the thief stole.

Withholding was implemented during World War Two as a “temporary” wartime measure. Yet, it is still with us decades later.

Milton Friedman, as a young economist, played a role in the US government’s development of withholding. Of course, Friedman went on to become a leading advocate for free markets. He also redeemed himself for his work on withholding by becoming a prominent advocate for ending the military draft.

The draft is the worst example of how the government has rejected the principles of the Declaration of Independence. The draft gives government power to force young men (and possibly young women) to join the military and kill or be killed in a war. Contrary to the beliefs of some progressives, support for the draft is not justified by allowing individuals to choose between serving in the military or performing some other form of mandated “service.”

While the US does not have a military draft, the infrastructure for the draft remains in place via Selective Service registration. A provision in this year ‘s National Defense Authorization Act (NDAA) allows Selective Service to automatically register all men between the ages of 18 and 25. This makes it easier than ever for government to reinstate a draft.

Income taxes, along with the military draft and other types of mandated “service,” are incompatible with a free society and should be opposed by all who value liberty and peace. As Ronald Reagan said in a statement that could be modified to apply to income taxes, the draft “rests on the assumption that your kids belong to the state…. That assumption isn’t a new one. The Nazis thought it was a great idea.”

Tyler Durden Mon, 04/27/2026 - 23:25

OpenAI Misses Revenue, User Targets As CFO Fears $1.5 Trillion In Commitments Can't Be Paid

Earlier today, when previewing this week's earnings by the Mag 7 which account for over $10 trillion in market cap set to report Q1 results after the close on Wednesday, Goldman's Delta-One head Rich Privorotsky said that "Equities are being driven by one thing…AI spend", and warned that "it's hard not to respect the strength of the AI bid, but the velocity has been extreme. The upside surprise vs expectations has almost entirely come from AI spend…it’s the whole game." 

Not only is the whole game, it is the one thing that has prevented the market from collapsing into the Iran war's stagflationary black hole, with "oil/product prices is sucking the oxygen out of the room...Europe underperforming, dispersion extreme." 

But none of that matters as long as capex recipients, i.e., chip and semi stocks, keep surging on hopes and expectations that the LLMs and hyperscalers will keep pumping them full of cash day after day, for the unforeseeable future, which they have so far: recall that at the end of Q4, full-year capex estimates soared to a mindblowing $740 billion among just 6 hyperscalers (a number which is expected to rise to almost $1 trillion in 2027).

And at top of this trickle-down monetary waterfall is none other than Sam Altman's OpenAi, generously peeing money into the overeager mouths of hyperscalers around the globe, having built up staggering purchase commitments to the tune of $1.5 trillion because there will never be enough compute. 

Maybe Sam's right: perhaps there truly is an insatiable need for compute (unless of course one uses Chinese LLMs and/or RAM chips, both of which have a fraction of the hardware demands of the latest and greatest US technology). 

The problem arises when one asks if OpenAI will ever be enough revenue to satisfy these astronomic commitments. 

For much of the past year, that has been the core thesis behind countless AI bear cases: now that even Michael Hartnett openly calls tech a "bubble", the question is not if but when, to which the bulls have calmly countered that as long as the drunken-sailor at the helm of OpenAi keeps spending at the rate he has been, the "when" isn't coming any time soon.

It now appears, however, that the "when" may have come much sooner than most thought. 

According to the WSJ, OpenAI has recently missed its own targets for both new users and revenue, stumbles that have raised concern among some company leaders about whether it will be able to support its massive spending on data centers.

One of them is the company's finance chief: CFO Sarah Friar told other company leaders that she is worried the company might not be able to pay for future computing contracts if revenue doesn’t grow fast enough. In other words, that $1.5 trillion OpenAI had pledged to spend on various data centers, GPUs and memory chips... you can kiss all that goodbye.

Of course, none of this will come as a surprise to anyone familiar with Sam's mercurial style of capital allocation. As a reminder, when OpenAi made its $1.5 trillion flurry of deal announcements last fall, a few things were missing, among them how it plans to fund them, details of the bulk of the financial terms, and any mention of who was providing independent, clear-eyed advice on these complex mega transactions. The reason for that, as the FT reported at the time, is OpenAI still doesn’t know exactly how it will fund them, the terms mostly don’t exist, and advisers were overwhelmingly shunned.

In fact, we learned last October, Sam Altman came up with the “bold vision” himself and leaned heavily on a small number of lieutenants to flesh out the details and push the deals through with little involvement of bankers or lawyers.

One of the brilliant side quests completed by Altman during this period of epic obfuscation (and unprecedented wealth generation by Sam for himself from a "non-profit" thanks to nothing more than promises) was unleashing the AI circle jerk, pardon, circular financing concept, where one company would "invest" in its customer, only to see that money flow back to its through the income statement but not before lifting its PE by several turns; this process would be repeated countless of times lifting all AI valuations substantially even if no actual revenue or cash flow was created. Eventually, virtually every company in the AI sector was wrapped up in such circular structures that tied together suppliers, investors and customers (see "The Stunning Math Behind The AI Vendor Financing "Circle Jerk".")

Yet promises (and lies) can only go so far, and even the loftiest of grand schemes are eventually brought to the ground when the revenue fails to materialize. As it has for OpenAi.

As a result, the company's board of directors have started to closely examine the company’s data-center deals in recent months and questioned Sam Altman’s efforts to secure even more computing power despite the business slowdown, the WSJ reported.

The spending scrutiny is constraining Altman’s once-boundless ambitions ahead of a potential IPO that could take place by the end of the year (he desperately wants to go public before his former employee and arch nemesis, Dario Amodei takes Anthropic public).

Friar and other executives are now seeking to control costs and instill more discipline in the business, at times putting them at odds with their CEO; this may very well mean that the money spigot that has pumped hundreds of billions in capex promises is about to be shut as well, leaving the entire AI ecosystem in a Wile E Coyote moment, suspended in the air off the cliff, just before gravity kicks in.

In a desperate attempt to keep reality as far away as possible, the two heads of OpenAI had no choice but to deny there was any trouble in paradAIs: “We are totally aligned on buying as much compute as we can and working hard on it together every day,” Altman and Friar said in a joint statement. Any suggestion that the pair are divided or pulling back on securing new computing resources is “ridiculous,” they said. 

Well, of course they would: the alternative would be an immediate collapse of OpenAI's valuation as revenue growth suddenly collapses, and takes the entire AI bubble with it.

Still, with OpenAI having difficulty to generate even 2% of its spending commitments in the form of revenue (ignoring that the company will likely never be profitable), denials may be all OpenAI has left. 

For years, Altman has sought to lock up as much data-center capacity as possible, arguing that computing shortages were the biggest constraint to OpenAI’s growth. As noted above, Sam went on a "dealmaking" spree last year that put OpenAI on the hook for some $1.5 trillion in future spending commitments, and tied much of the tech sector’s success to OpenAI’s.

In other words, if OpenAI goes down, it will take the entire AI sector with it. And since AI is now 40% of the S&P500... you get the picture (if you don't, reread the comments above from Goldman's Delta One head).

Not that anyone can blame Sam for thinking he would get away with it: for a long time, he did. His “buy everything” computing strategy was buoyed by ChatGPT’s seemingly invincible success, and had the support of both Friar and the board. But the chatbot’s growth slowed toward the end of last year, especially as Claude starting stealing clients, sowing fresh doubt among company leaders about the approach.

What followed next was the first domino to fall: OpenAI missed an internal goal of reaching one billion weekly active users for ChatGPT by the end of last year, according to people familiar with the goals. The company still hasn’t announced that milestone, unnerving some investors the WSJ reports. It also missed its yearly revenue target for ChatGPT as well after Google’s Gemini saw massive growth late last year and ate into OpenAI’s market share. Worst of all, for the industry where there are still almost no switching costs, the company has also struggled with defection rates among subscribers, according to WSJ sources.

Things went from bad to worse in 2026 when OpenAI missed multiple monthly revenue targets earlier this year after losing ground to Anthropic in the coding and enterprise markets, people familiar with its finances said.

OpenAI recently raised $122 billion in what was the largest funding round in Silicon Valley history, putting it on more solid financial footing. But to get there, the company signed up for so much computing power that it expects to burn through that amount in the next three years, and that's assuming that it meets ambitious revenue targets. Some of the funding is also conditional and depends on specific agreements with partners (and may explain why Microsoft, which knows the company's business best of all, dramatically revised its agreement with OpenAI earlier today).  

To streamline costs, OpenAi recently cut non-core projects such as its video-generation app Sora. OpenAI also recently released GPT-5.5, a powerful model that topped a number of industry benchmarks. Then again, in an industry where the frontier jumps every 2-3 months, the latest model will be obsolete by July. 

Meanwhile, a blowback from within the user base is emerging: a number of AI companies including Anthropic have faced a capacity crunch for computing in recent weeks, leading to price increases for access to AI processors, outages and rationing. The challenges have rankled power users of AI products, especially coders who have grown frustrated when AI systems have been unable to finish tasks in a way they had come to expect from past use.

In a recent memo to investors, OpenAI said that it has been able to secure more computing capacity than Anthropic, giving it an advantage in reaching users. The memo, which was viewed by The Wall Street Journal, also addressed Anthropic CEO Dario Amodei’s veiled criticism of OpenAI at a recent business conference, when he said some companies had pulled “the risk dial too far” on data-center spending. 

“In hindsight, that caution looks less like discipline and more like underestimating how fast demand would arrive,” the OpenAI memo said. 

It would be extremely ironic is Anthropic's "caution" proves correct in the end, and OpenAI is forced to cancel its contracts as it simply does not have the money (but not before Masa Son implodes).

In recent months, Friar has also expressed reservations about OpenAI’s plans to go public by the end of this year, according to people familiar with the matter.  She has emphasized to executives and board directors the need for OpenAI to improve its internal controls, cautioning that the company isn’t yet ready to meet the rigorous reporting standards required of a public company. Altman, who has favored a more aggressive timeline for an IPO.

OpenAI has to work through a slate of other issues ahead of a public listing. The company is currently experiencing a leadership vacuum after its second-in-command, Fidji Simo, unexpectedly took medical leave earlier this month.

But the knockout blow for OpenAi could, ironically, come from the person who funded the company in the first place back when it was still an "Open" non-profit. Court proceedings began today in a lawsuit by Elon Musk in which he is seeking to oust Altman and unwind OpenAI’s conversion into a for-profit company. Should Musk prevail, OpenAI may or may not survive, but Sam Altman will have no choice but to move on to his next scam. 

Scam Altman has a incredible track record for being a con artist I don't think anyone has a "former ally turned enemy" list this big with directly with people he worked with

A massive new 18-month investigation dropped, revealing the full list of people who worked directly with… pic.twitter.com/1aOkUEsgkq

— X Freeze (@XFreeze) April 27, 2026

Tyler Durden Mon, 04/27/2026 - 22:51

"Racial-Profiling" Or Race-Baiting? Tom Steyer's Illiterate Take On English Proficiency

Authored by Jonathan Turley,

If you go to NASCAR to watch the cars crash, the Democratic gubernatorial race in California has been a thrilling pile-up.

The recent debate saw all the Democratic candidates play the race card over a curious issue. When asked if they supported the move to rescind at least 17,000 commercial driver’s licenses to illegal aliens, every single Democrat declared the policy racist. The candidates also pledged to support truckers who cannot speak or read English.

When Sheriff Chad Bianco, a Republican candidate, said that being able to read English (and particularly English signs) should be mandatory, Porter lectured the Hispanic sheriff on racism, saying that his support for English proficiency by truckers disqualified him from being governor of California.

Not to be outdone, Democratic candidate Tom Steyer declared that requiring truck drivers to be able to read English is “racial profiling.”

Steyer, a billionaire, has been funding his own campaign with almost $120 million and has tried to capture the far-left supporters of Swalwell. In so doing, he has increasingly looked like Howard Hughes with better-trimmed nails.

Steyer grabbed Swalwell’s platform of pledging to arrest ICE officers and take punitive measures against them. He cannot fulfill that pledge, and the Ninth Circuit recently shot down the flagrantly unconstitutional California law seeking to dictate the conduct or appearances of federal officers. The law was supported by Gov. Gavin Newsom and all of the Democratic candidates.

Steyer’s claim that English proficiency rules are “racial profiling” is more Looney Tunes than law.

Racial profiling occurs when a person’s racial appearance alone is grounds for reasonable suspicion for a stop or search. English proficiency requirements are race-neutral conditions to ensure basic safety in the operation of large trucks. We have seen several fatal cases involving undocumented persons who could not read or speak English proficiently.

Even the use of apparent race or ethnicity is allowed when part of a totality of circumstances or observations by law enforcement. Last year, the Supreme Court stayed a racial profiling case from California on that ground, in favor of law enforcement, in a 6-3 decision in Noem v. Vasquez-Perdomo.

If requiring English proficiency is racial profiling, a wide array of jobs in the United States are the products of racism, including airplane pilots, air traffic controllers, U.S. military, astronauts, mechanics, and baseball umpires. Even the European Space Agency has required English proficiency.

By Steyer’s standard, he may also be the product of a racial profiling system. In order to appear on the ballot, Steyer certified that he is a U.S. citizen. To be a U.S. citizen, you must be proficient in English. Thus, a candidate must certify that he is both a citizen and English-proficient. He can then go on a stage and call such requirements racial profiling without any basis in the law.

Ironically, Steyer made much of his money managing Farallon Capital Management, which profited from owning private prisons and, in the case of Corrections Corporation of America (CCA), actually runs one of the largest ICE facilities. Now called CoreCivic, the company requires not only U.S. citizenship but also English proficiency.

As with the pledges to arrest ICE officers and dictate how they conduct their operations, the racial profiling claim is knowingly misleading and unfounded. It is designed to pander to the far left by suggesting that requiring basic English skills of large-truck operators is somehow unlawful or unconstitutional.

The only thing that Steyer proved, again, is that there are sadly few requirements to run for governor of California beyond a large fortune and little shame.

Jonathan Turley is a law professor and the best-selling author of “Rage and the Republic: The Unfinished Story of the American Revolution.”

Tyler Durden Mon, 04/27/2026 - 22:35

Kim Jong Un Opens Museum Commemorating Troops Killed Fighting For Russia, Blasts US 'Hegemony'

North Korea has continued its surprising level of public acknowledgement of troop deaths in the Russia-Ukraine war, where it has maintained some 10,000 or more troops in support of Moscow. Starting last summer North Korea began issuing footage of coffins of slain DPRK troops being flown into Pyongyang, with Kim Jong Un in attendance.

Now the 'pariah' nation long hated by Washington is taking publicizing its Russia operation a big step further, having newly opened a memorial museum in Pyongyang for its soldiers killed in the conflict. 

KCNA via AFP

What is called the Memorial Museum of Combat Feats at the Overseas Military Operations has been formally opened in an inaugural ceremony on Sunday. The occasion fell on the one-year anniversary of the two countries having liberated Russia’s Kursk border region from a Ukrainian incursion.

State-run Korean Central News Agency (KCNA) confirmed that Kim Jong Un attended the event along with senior Russian officials, including State Duma Chairman Vyacheslav Volodin and Defense Minister Andrei Belousov.

South Korea’s intelligence agency some  2,000 North Korean troops have been killed in the operation, out of some 15,000 total; however, neither Moscow nor Pyongyang have issued any official figures.

In a speech by Kim during the ceremony, he declared that the fallen troops would remain "a symbol of the Korean people’s heroism" and would support "a victorious march by the Korean and Russian people."

He also as expected lashed out at the United States for imperialist wars, charging that Washington and its allies are pursuing a "hegemonic plot and military adventurism" on the Russia-Ukraine front.

Back in April, President Putin released a statement saying, "The Russian people will never forget the heroism of the Korean special forces. We will always honor the Korean heroes who gave their lives for Russia and for our shared freedom, alongside their brothers-in-arms from the Russian Federation."

KCNA via AFP

Eventually, Pyongyang will want Russia to return the favor as part of the two countries' deepened defense pact. There's always the potential for renewed conflict on the Korean peninsula - and potential presence of Russia troops in the north would certainly complicate things, also given the permanent American bases in South Korea.

Ukraine has meanwhile long bitterly complained about the foreign contingencies helping Russia, and in previously claimed that North Korea could send up to 30,000 - though there's been little evidence of such a high figure.

Tyler Durden Mon, 04/27/2026 - 22:10

SEC Issues Warning For US Investors On Phishing, Smishing, & Vishing Scams

Authored by Naveen Athrappully via The Epoch Times,

The U.S. Securities and Exchange Commission (SEC) warned investors recently that fraudsters use phishing, smishing, and vishing scams to attempt to compromise their financial, investment, or personal accounts.

“Phishing, smishing, and vishing are types of scams where a fraudster tries to trick you into providing sensitive personal or financial information by posing as an entity you know or trust, such as an investment firm, bank, or some other personal service that you use,” the SEC said in an April 23 alert.

Once a malicious actor gets the personal information of a target, such as social security numbers, bank account numbers, ATM PINs, and driver’s licenses, they can use this to access the target’s accounts

“The main difference between these ‘-ishing’ scams is the method the fraudster uses to try to steal your information or carry out other attacks.”

Phishing involves the use of email to contact a target, tricking them into providing personal or financial information. This is done by urging the target to reply to the mail, clicking on a link to a website mimicking a legitimate platform, or opening an attachment, which downloads malware into their systems.

Fraudsters can use names of real people, companies, or government agencies to make the message sound authentic. The email address they use may contain the name of a company or government agency. The emails could also contain official-looking fine print, legal references, along with graphics and logos.

Such emails typically invoke urgency to solicit information. For instance, the hackers may claim the target’s bank account or other types of accounts will be closed if it’s not updated with certain information. Some fraudsters can claim problems with account or payment information, while others entice through monetary schemes such as prize money.

Smishing and vishing are similar to phishing. Smishing involves fraud via texts or direct messages, while vishing involves the fraudsters contacting targets via phone calls.

In its 2025 Internet Crime Report, the FBI listed phishing as a major financial crime type for the year.

The agency’s Internet Crime Complaint Center (IC3) received more than 1 million complaints in total from people who were defrauded out of their money.

Last year, phishing/spoofing was the top crime type reported to IC3, which received 191,561 complaints. Phishing and spoofing resulted in more than $215 million in losses to the complainants.

In the recent alert, the SEC said that its efforts to warn investors about phishing, smishing, and vishing were in accordance with a March 6 executive order signed by President Donald Trump, “Combating Cybercrime, Fraud, and Predatory Schemes Against American Citizens.”

The order defined cybercrime and predatory schemes as activities involving phishing scams, ransomware and malware attacks, sextortion, financial fraud, and impersonation. It called on officials to determine how regulatory, operational, technical, and diplomatic tools can be improved to counter transnational criminal organizations behind cybercrimes.

In a March 6 Fact Sheet, the White House said, “In 2024, American consumers reported losing more than $12.5 billion to cyber-enabled fraud, with seniors on average losing the most.”

“[Seventy-three] percent of U.S. adults have experienced some kind of online scam or attack, and 87 percent of seniors view online scams and attacks as a major problem.”

Protecting Accounts

In another April 23 alert, the SEC advised people to protect their online investment accounts from fraud by using strong passwords, changing passwords regularly, using two-step verification, turning on account alerts, adding biometric safeguards, and avoiding using public computers to access accounts.

SEC asked investors to use caution when using public Wi-Fi connections.

“If you access your account on a public wireless connection, such as at a coffee shop or airport, you should use extra caution. It is very easy to ‘eavesdrop’ on internet traffic, including passwords and other sensitive data, on a public wireless network.”

The agency advised investors in a separate alert on April 23 to contact their investment company immediately if they think their account has been compromised.

Plus, investors should regularly monitor investment accounts for any suspicious activity. “Look out for any changes to your account information that you do not recognize (e.g., a change to your address, phone number, e-mail address, account number, or external banking information),” the SEC said.

“You should also confirm that you authorized all of the transactions that appear in your account statements and trade confirmations.”

Tyler Durden Mon, 04/27/2026 - 21:45

The Moral Malaise: The New York Times Makes The Case For "Microlooting" To Murder

Authored by Jonathan Turley,

“It is so hard to live ethically in an unethical society.” That lament heard this week from New York Times opinion culture editor Nadja Spiegelman could well be the Democratic Party’s epitaph.

Spiegelman was interviewing two left-wing influencers about how everything from shoplifting to murder may be excusable today in light of the unfairness they see in society.

The podcast, a product of the nation’s newspaper of record, reveled in the moral relativism that has taken over the American left. It featured the ravings of the antisemitic Marxist streamer Hasan Piker, who calmly explained how the murder of United Healthcare executive Brian Thompson was perfectly understandable. His rationalization came from Marxist revolutionary Friedrich Engels, who had called capitalism “social murder.” If capitalists are “social murderers,” then why not kill them? The logic is liberating and lethal for some on the left looking for a license for violence.

Mind you, this same newspaper had once condemned and effectively banned a U.S. senator for writing an op-ed advocating the use of the military to quell violent protests during the summer of George Floyd’s death. The Times even forced out its own opinion editor for having the temerity to publish such an opinion.

But glorifying murder? The suggestion of open hunting season on corporate executives did not appear to shock or repel Spiegelman. After all, we are living in “an unethical society.” She explained that many felt that the murder of Thompson, the father of two, meant that “finally, someone can actually do something about health care.”

Even liberal comedians are practicing a literal version of slapstick. Margaret Cho this week declared that “we need a feral, bloodthirsty, violent Democrat.”

To be fair, Spiegelman did concede that it might seem a bit “scary” for some to start murdering our way to social justice.

She also explained that shoplifting can be justifiable because people are “stealing from Whole Foods — not just for the thrill of it, but out of a feeling of anger and moral justification.”

New Yorker writer Jia Tolentino also contributed to the podcast, titled “The Rich Don’t Play by the Rules. So Why Should I?” She immediately threw in her own experience with “microlooting” and explained why it is arguably moral: “I have, under very specific circumstances. I will say, I think that stealing from a big-box store [isn’t] significant as a moral wrong, nor is it significant in any way as protest.”

She detailed her own past thefts and added, “I didn’t feel bad about it at all, in part because the store was a corporation. And it certainly felt, in a utilitarian sense, I was like, this is not a big deal. Right, guys?”

Not in the confines of the New York Times, where apparently you are entitled to all goods that are fit to pilfer.

The bizarre exchange highlighted the moral chasm that is opening its maw on today’s political left. In my book “Rage and the Republic,” I write about how rage helps people excuse any offense or attack. It dismisses the humanity of others and provides a license to hate completely and without reservation.

It is not really murder or theft if there are no real humans on the other side, is it?

Other columnists have defended such property crimes. Washington Post writer Maura Judkis ran a column mocking shoplifting stories as the “moral panic” of a nation built on “stolen land.” It is reminiscent of those who excused rioting in past summers “as an expression of power” and demanded that the media refer to looters as “protesters.”

Former New York Times writer (and now Howard University Journalism Professor) Nikole Hannah-Jones went so far as to call on journalists not to cover shoplifting crimes.

At its core, it is a denial of transcendent values and rights. It is a decoupling of our society from a grounding in moral or universal truths. It is a trend that extends not only to attacks on individuals but also to attacks on our constitutional system. There is a growing denial of our founding based on Enlightenment principles of natural rights, which come not from government but from God.

Some people seem to have forgotten this. In 2024, a celebrated political journalist memorably asserted that belief in God-given rights is a form of “Christian nationalism” — an odd claim about a concept the nation’s founders literally wrote into our Declaration of Independence.

Last year, Sen. Tim Kaine (D-Va.) — a man who represents Thomas Jefferson’s own state — attacked a witness in committee for espousing Jefferson’s immortal assertion that human beings’ natural rights are endowed by their Creator. Kaine disparaged this idea as something worthy of Iran’s mullahs.

The result is the type of moral free-fall and rejection of personal responsibility expressed on the New York Times podcast. Simply because they condemn our entire age as unethical, they feel justified in asserting a moral right to commit any offense, from microlooting to murder. This underpins the increasingly frequent justifications made for attacks against conservatives or law enforcement as a form of “defending democracy.”

Yet the feeling of “anger and moral justification” does not make an act moral. It is the morality of mayhem; a spreading decay within our society. History has shown us how democracies can become mobocracies.

During the French Revolution, journalist Jacques Mallet du Pan observed that “like Saturn, the Revolution devours its children.” The sad fact is, it is not just the danger of fellow revolutionaries deciding that you are the next reactionary to be guillotined. It is the self-consumption of radicals who untether themselves from any higher order or purpose. It is the knowledge that all mortals carry the Saturn gene; all mortals share the capacity to become monsters.

Jonathan Turley is a law professor and the New York Times best-selling author of “Rage and the Republic: The Unfinished Story of the American Revolution.”

Tyler Durden Mon, 04/27/2026 - 20:55

Upcoming Weather Shift "Far From Drought-Breaker" For America's Parched Breadbasket

Some of the worst drought conditions in a generation are plaguing America’s breadbasket just as spring planting season gets underway. Institutional desks, including UBS, have ramped up warnings about drought, fertilizer shortages, and what these current-day issues could morph into for the food supply chain later this year.

The good news: parts of the central U.S. may finally see some weather relief, with several days of rain in the forecast. Whether that will be enough to materially improve soil moisture conditions remains the key question for agricultural desks this week.

"The upcoming weather pattern in the United States, fueled by a strong subtropical jet stream, will bring some beneficial rain to the drought-stricken South," meteorologist Ben Noll wrote on X, adding, "But it will be far from a drought-breaker."

The upcoming weather pattern in the United States — fueled by a strong subtropical jet stream — will bring some beneficial rain to the drought-stricken South.

But it will be far from a drought-breaker. pic.twitter.com/3Zfhm1KpfT

— Ben Noll (@BenNollWeather) April 27, 2026

Noll is correct: it will take many more rounds of storms to fully erase the drought, especially given what UBS analyst Jonathan Pingle told clients last week.

The National Oceanic and Atmospheric Administration's Palmer Drought Severity Index hit its highest level for March since records started in 1895, and March was the third-driest month recorded, regardless of time of year, behind only the famed 1930s Dust Bowl: July and August 1934. Water levels on the Mississippi look fine, and seasonal lows are typically in the fall, but river levels in Memphis sit 24 feet below this time last year.

Here's The Weather Channel's forecast for rain this week across the Midwest and Southeast:

Tuesday

Wednesday

Thursday

Friday

Saturday

Better than nothing. 

Tyler Durden Mon, 04/27/2026 - 20:30

Nearly 10,000 Pounds Of Methamphetamine And Marijuana Seized By US Authorities

Authored by Naveen Athrappully via The Epoch Times (emphasis ours),

Around 10,000 pounds of marijuana and methamphetamine were seized by U.S. authorities in two separate incidents in recent weeks.

A joint operation on April 20 intercepted a Go-Fast vessel with 3.2 tons of marijuana, the largest load of marijuana ever stopped in Colombian waters. Courtesy of the Joint Interagency Task Force/X

“A joint operation on April 20th led by @ArmadaColombia intercepted a Go-Fast vessel with 3.2 tons of marijuana, the largest load of marijuana ever stopped in Colombian waters, preventing drug-trafficking organizations from reaping the profits,” the Joint Interagency Task Force (JIATF) South said in an April 23 post on X. Armada Colombia is part of the country’s naval defense arm.

The 3.2 tons of marijuana, which comes to 6,400 pounds, has an estimated spot value of roughly $7 million.

JIATF leverages its member nations’ capabilities to identify and monitor drug trafficking in the air and maritime domains. The task force seeks to interdict and take the drugs into custody to disrupt the shipment of illicit narcotics and degrade or dismantle transnational criminal organizations.

In another significant seizure, Customs and Border Protection (CBP) officers at the Otay Mesa Commercial Facility, California, took custody of more than 3,000 pounds of methamphetamine, with an estimated value of $4.92 million, according to an April 23 statement from the agency.

The narcotics were “concealed within a cargo trailer,” which the CBP had referred for a secondary inspection on April 14, the agency said.

“The shipment manifest had listed the commodity as corrugated cardboard boxes,” it said.

An initial nonintrusive inspection identified anomalies in the front wall of the trailer. A physical inspection found 300 packages of meth.

According to a report from the Centers for Disease Control and Prevention, the overdose death rate involving psychostimulants with abuse potential, primarily methamphetamine, was 10.4 people per 100,000 individuals in 2023.

“Our CBP officers at ports of entry are unwavering guardians,” Otay Mesa Port Director Rosa E. Hernandez said.

“Their diligence prevented illegal narcotics from entering our country, so our communities are kept safe from dangerous drugs.”

Tackling the inflow of drugs is a key focus area of the Trump administration. In an April 2025 Statement of Drug Policy Priorities, the White House said the administration has identified an “urgent need for decisive action” to tackle the illicit drug crisis plaguing the United States.

According to the statement, the Trump administration aims to reduce the number of overdose fatalities, decrease the global movement of illicit drugs, stop the flow of drugs from across the border into U.S. communities, reduce the initiation of drug use, and offer treatments that lead to long-term recovery from addiction and substance use disorders.

“To achieve our vision of a safer, healthier future for Americans, we will disrupt the supply chain from tooth to tail. We will partner with or otherwise hold accountable countries that are sources of precursor chemicals and finished drugs that enter the United States,” the statement said.

Crackdown on Drug Operations

In a March 17 statement to a House committee, Joseph M. Humire, performing the duties of the assistant secretary of war for homeland defense and Americas security affairs, said the Department of War (DOW) has been focusing on the maritime flow of illicit narcotics into the United States from South America.

Since September 2025, the DOW has been conducting kinetic strikes on suspected drug trafficking vessels that have had a positive impact in curtailing drug flow, according to the official.

“Since the first September strike, there has been a 20 percent reduction of movements of drug vessels in the Caribbean and an additional 25 percent reduction in the Eastern Pacific. These two maritime corridors are the origin source for follow-on flow into the U.S. Homeland,” Humire said.

“We have successfully deterred cartels from exploiting key maritime routes, leading to a more than 20 percent reduction in cocaine flow.”

Last week, the White House Office of National Drug Control Policy hosted the Interdiction Committee Principals Meeting, with officials from the State Department, Homeland Security, Justice Department, DOW, the Treasury, and the Intelligence Community meeting to advance President Donald Trump’s drug policy priorities, the White House said in an April 20 statement.

Participants discussed matters related to current operations aimed at reducing the supply of illicit drugs, and reviewed methods to integrate information from drug interdictions to investigations in order to better target criminal networks.

“The Interdiction Committee is where policy and operations collide. We know that every interdiction, every arrest, and every successful prosecution is an opportunity for law enforcement and the intelligence community to combat cartel operations, their supply chains, and the illicit financing that fuels it all,” U.S. Interdiction Coordinator and Committee Chairperson Daniel Boatright said.

Tyler Durden Mon, 04/27/2026 - 20:05

Democrat-Owned Brewery Complains About Failed Trump Assassination Attempt With Twisted Promise To Customers

Minocqua Brewing Company, a craft-beer maker in Minocqua, Wisconsin, run by a Democrat activist, is facing fierce blowback after its social-media account appeared to mock a recent assassination attempt on President Donald Trump and reiterated an earlier pledge to offer free beer on the day of his death.

Minocqua Brewing Company owner Kirk Bangstad (screenshot via Instagram)

The company, owned by Kirk Bangstad - who ran as the Democrat nominee for Wisconsin’s 34th Assembly District in 2020 and founded an anti-Republican super PAC - posted on social media shortly after news of the latest attempt on the president. “Well, we almost got #freebeerday,” the post read, according to screenshots circulated online. “Either a brother or sister in the Resistance needs to work on their marksmanship or he faked another assassination to get a positive news cycle. We’ll never know.”

“Regardless, we stand at the ready to pour free beer the day it happens,” the post added.

The brewery had previously promised free beer “all day long, the day he dies,” in reference to Trump. The company also sells merchandise tied to the pledge, including T-shirts that read “I wish it was free beer day,” and markets itself as blending craft beer with radical progressive activism.

A spokesman for the Wisconsin Democrat Party condemned the post. “This rhetoric is completely unacceptable and should be retracted immediately,” Phil Shulman told the Milwaukee Journal Sentinel. “We’re not afraid to call out this sort of inappropriate behavior no matter where it comes from—our GOP colleagues should learn to do the same.”

Republican officials and Trump allies denounced the comments as inflammatory, urging broader Democratic condemnation.

"Wisconsin Democrats are so sick in the head that an attempted murder is funny to them," Republican National Committee spokesperson Delanie Bomar told Fox News in a statement. "All Wisconsin Democrats, including Rebecca Cooke, must immediately condemn this disgusting behavior.”

This brewery in Wisconsin is gushing over the assassination attempt.

These people want us dead. pic.twitter.com/Hf4x99Dq1i

— Dustin Grage (@GrageDustin) April 26, 2026

.@RebeccaforWI worked for this reprehensible scum, and that is exactly what he is.

This is shocking and she needs to answer for this now.

Unfit for office, both of them. https://t.co/o6Zw6BFadZ pic.twitter.com/6iIMv1Z48J

— Derrick Van Orden (@derrickvanorden) April 26, 2026

This is deranged and beneath our state.

Wisconsin, let’s unite in rejecting this garbage.

— Tom Tiffany (@TomTiffanyWI) April 26, 2026

The brewery’s post was later deleted, according to Beer Street Journal.

The latest assassination attempt against Trump unfolded Saturday evening at the White House Correspondents’ Dinner held at the Washington Hilton. U.S. law enforcement has identified the suspect as Cole Tomas Allen, a 31-year-old tutor, game developer, and Caltech graduate from Torrance, California. Allen allegedly attempted to breach a security checkpoint near the event’s screening area, opening fire and prompting return shots from the Secret Service. In a manifesto sent to family members minutes before the attack, Allen described himself as a “friendly federal assassin,” listed Trump administration officials as prioritized targets, and expressed deep hostility toward the president and his policies, the Los Angeles Times reported.

Tyler Durden Mon, 04/27/2026 - 19:40

Report Claims Iranian Jet Bombed American Base In Kuwait At War's Start

Authored by Dave DeCamp via AntiWar.com,

Iranian attacks on US bases across the Middle East have caused far more damage than the Trump administration has publicly acknowledged, and an Iranian fighter jet was able to bomb at least one US base, NBC News reported on Saturday, citing unnamed US officials.

The administration has attempted to cover up the damage to US bases in the war, and has gone as far as requesting that Planet Labs and other satellite imagery companies black out war images, making it difficult to ascertain the damage.

The NBC report said that the Pentagon has also kept the information on the damage from Congress. “No one knows anything. And it’s not for lack of asking,” a Republican congressional aide told the outlet. “We have been asking for weeks and not getting specifics, even as the Pentagon is asking for a record high budget.”

Iranian missile and drone attacks have targeted US bases in seven Middle Eastern countries: Bahrain, Kuwait, Saudi Arabia, the UAE, Iraq, Jordan, and Qatar. US officials said that an Iranian F-5 fighter jet was able to bomb the US base at Camp Buehring in Kuwait despite it having air defenses, marking the first time in many years that an enemy fixed-wing aircraft struck a US military installation.

The US armed Iran with Northrop Grumman-made F-5 fighter jets before the 1979 Islamic Revolution, and Iran has developed its own version of the aircraft, known as the HESA Kowsar.

Kuwait was also the site of a March 1 Iranian drone attack that killed six US Army Reserve soldiers and injured more than 20. The drone targeted a makeshift operations center in Port Shuaiba, and according to survivors of the attack who spoke to CBS News, the facility was unprotected despite claims from US War Secretary Pete Hegseth that the drone was able to “squirt” through air defenses.

The Pentagon has confirmed the deaths of at least 13 US soldiers and the injuries of more than 400 in the war. The bases across the region were mostly evacuated since they were so vulnerable to attack, something The New York Times previously reported.

“Many of the 13 military bases in the region used by American troops are all but uninhabitable, with the ones in Kuwait, which is next door to Iran, suffering perhaps the most damage,” the Times reported on March 25.

The NBC report said that the headquarters of the US Navy’s Fifth Fleet in Bahrain “sustained serious damage” and that other US bases in the country also suffered serious damage that is likely repairable.

An Iranian F-5 flew through air defences and bombed the US base in Kuwait. No enemy fighter jet has bombed a US target since Korea https://t.co/62L0rbuwq4

— Nate Bear (@NateB_Panic) April 25, 2026

The report also cited the American Enterprise Institute (AEI), a Washington-based think tank, which said it assessed Iran hit more than 100 targets across 11 bases, and that the repairs would cost at least $5 billion, though the number doesn’t account for some of the radars, weapons systems, and other equipment that was destroyed.

Tyler Durden Mon, 04/27/2026 - 19:15

"Let's Get Ruthless": Bulwark's Bill Kristol Suggests Illiberal Means Are Needed To Save Liberal Democracy

Authored by Jonathan Turley,

“Let’s get ruthless.”

Those words are, unfortunately, nothing new in this age of rage.

In just the last few weeks, various liberal pundits and politicians have been calling for radical and even violent action.

Even comedian Margaret Cho publicly declared this week that “we need a feral, bloodthirsty, violent Democrat.”

However, these words were reposted by Bill Kristol, the founder of the Weekly Standard and the current editor-in-chief of The Bulwark. Kristol was a leading conservative figure in the Republican Party.

Kristol left the Republican Party and is now a vehemently anti-Trump writer. There are certainly good-faith reasons why some conservatives have broken with Trump on a variety of issues.

However, the original column was endorsing the Democratic plan to pack the Supreme Court with an instant liberal majority to force through a slew of political changes in the country.

Various Democrats have been pledging to not only impeach Trump (and a long list of other figures), but to pack the Supreme Court as soon as they regain power.

James Carville declared, “If the Democrats win the presidency and both houses of Congress, I think on day one, they should expand the Supreme Court to 13. F— it. Eat our dust. Don’t run on it. Don’t talk about it. Just do it.”

This Nike School of Constitutional Law is catching on with a wide array of pundits and professors. Just do it.

Years ago, Harvard professor Michael Klarman laid out a radical agenda to change the system to guarantee Republicans “will never win another election.” However, he warned that “the Supreme Court could strike down everything I just described.” Therefore, the court must be packed in advance to allow these changes to occur.

Former Obama Attorney General Eric Holder has put packing the Supreme Court front and center, explaining, “[We’re] talking about the acquisition and the use of power if there is a Democratic trifecta in 2028.”

Years ago, I wrote an academic piece on the possible expansion of the Supreme Court, but there is a world of difference between that and a court-packing plan. Under my proposal, the court’s expansion would take almost two decades to ensure that no president could pack the court.

It was not just the company that Kristol is keeping on the issue, or his endorsement of the long-anathema concept of court packing, but also his rationale for the move. Kristol cited the successful Democratic gerrymandering efforts in California and Virginia as triumphs that should now propel the left to pack the Court.

Kristol reposted the call for court packing from his colleague Jonathan Last: “Expanding the Supreme Court is no different from redistricting in California and Virginia,” he said. “It is a proportionate response to Republican attempts to degrade liberal democracy and move America toward a post-liberal order.”

Praising governors Gavin Newsom and Abigail Spanberger for their “ruthless” leadership in response to Republican gerrymandering, Kristol insisted that Democrats must meet “force with force” and must now pack the Supreme Court. Being ruthless, he argues, is the “only road to preserving liberal democracy.”

There is, of course, a considerable difference between altering political districts and packing the courts. Political gerrymandering has been around since the earliest days of the Republic.

The courts are not the same political fungible units. Indeed, the favorite term on the left is “illiberal democracy” to refer to democratic systems used to curtail rights and weaken checks and balances. Yet this illiberal means is being cited by Kristol as essential to save liberal democracy.

Liberal justices have spoken out against these calls for court packing.

The late Supreme Court Justice Ruth Bader Ginsburg said it would destroy the continuity and cohesion of the court.

She added, “If anything would make the court look partisan, it would be that — one side saying, ‘When we’re in power, we’re going to enlarge the number of judges, so we would have more people who would vote the way we want them to.’”

The political districts are precisely that: political. They are part of the two political branches in a tripartite system. It is the courts that keep these political branches within their proper constitutional orbits.

There was, of course, no movement to pack the court when a series of liberal majorities rewrote major areas of constitutional law in the 1960s and 1970s. These demands from figures like Sen. Elizabeth Warren were only heard when the court began to rule against their chosen outcomes.

Warren explained that the court had to be packed to bring its rulings in line with “widely held public opinion.”

Of course, Article III was designed precisely to blunt such pressures to rule according to “widely held public opinion.” The Supreme Court is a counter-majoritarian body that was created to protect rights against the passions or demands of the majority.

As I discuss in my book, “Rage and the Republic,” the founders sought to avoid “democratic despotism” and “mobocracy” by creating barriers to direct democratic powers. The Supreme Court is essential as a bulwark against such impulse politics. Those pushing for an instant liberal majority would convert the court into the type of partisan judicial bodies seen in states like Wisconsin where jurists are selected to robotically vote for party priorities.

There is a reason why “ruthless” was not an attribute cited by anyone in the constitutional convention to be fostered in our Republic. On the contrary, the system is designed to temper ruthless passions for reasoned debate.

The court itself may be the ultimate test of the lingering capacity for reason among our citizens. Of course, we can be ruthless and tear down our institutions on the 250th anniversary of our Republic.

No democratic system is ever immune from self-inflicted wounds. That is why Benjamin Franklin reminded us that this remains our Republic if we can keep it. This year, we can celebrate that Republic, or we can ruthlessly destroy it in a fit of blind rage.

Jonathan Turley is a law professor and the best-selling author of “Rage and the Republic: The Unfinished Story of the American Revolution.”

Tyler Durden Mon, 04/27/2026 - 18:25

"Resurgence Of Electrification": Goldman Says EV Demand Gaining Momentum Amid Fuel Price Shock

There were early signs during the third week of the U.S.-Iran conflict that EV demand was gaining traction in Asia, where the energy shock has been felt the hardest. That was followed by a separate note earlier this month confirming that EV demand was beginning to reaccelerate.

Now, Goldman analysts led by Kota Yuzawa see global EV demand gaining momentum after several years of muted demand, as the fuel-price shock at the pump pushes consumers back toward EVs.

Yuzawa noted that the share of the top 30 countries where the EV sales mix rose month over month climbed from 30% in January to 60% in February and 80% in March. This acceleration suggests the energy shock is helping pull the EV industry out of a multi-year rut. 

The reacceleration of global EV demand has likely gained further traction in April amid elevated prices. Goldman's commodity team, led by Daan Struyven, wrote in a separate note that his WTI fourth-quarter forecast was revised from the previous $75 to $83.

This suggests the energy crisis is becoming more prolonged, and elevated fuel prices at the pump mean that EV demand will likely continue to rise - at least until Brent and WTI crater, depending on a Hormuz chokepoint reopening and a US-Iran peace deal being signed.

Yuzawa highlighted the global EV market in March:

• We are monitoring the rise in natural gas prices in the Indian market, as we are concerned about the impact on Maruti Suzuki, which has a high share of CNG vehicles.

• In the Thai market, both BEVs and HEVs are outperforming. The growing demand for HEVs, which offer excellent fuel efficiency, is a positive for Toyota and Denso.

• In the Chinese market, we have confirmed a narrowing of discounts on NEVs. Exports are also expanding, which underpins our bullish view on BYD.

• The expansion in demand for ESS is driven by the adoption of renewable energy against the backdrop of energy security. This expands the applications for automotive batteries, providing a tailwind for Tesla, BYD, and GS Yuasa.

EVs Outperform Amid Price Stabilization

Electrification Advances By Country

Really, all the EV industry needed wasn't lower auto loan rates but a Hormuz chokepoint closure and a global fuel-price shock to jolt demand back to life. Who would've thought...

Professional subscribers can read the full "Resurgence of Electrification" note at our new Marketdesk.ai portal.

Tyler Durden Mon, 04/27/2026 - 18:00