Yield Curve Screams Recession, Bonds vs. Dividends, & Will Threads Overtake Twitter?

The yield curve just hit its deepest inversion since 1981, signaling that a recession could be imminent.

Plus: with 10-year Treasuries yielding 4 percent, it may be time to dump dividend stocks, and the new Twitter clone from Instagram hits 100 million users.

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On The WealthChannel Podcast, we unlock the world of wealth, money, and finance. Hosts Jimmy Atkinson and Andy Hagans deliver unfiltered views on the most important news that investors need to know right now.

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Jimmy: Welcome to The WealthChannel, the show where we explore the world of wealth, money and finance. He’s Andy Hagans. I’m Jimmy Atkinson. On today’s episode, the yield curve hits its deepest inversion since 1981, Treasuries outpace dividend stocks, and Instagram’s new Twitter clone hits 100 million users in five days.

But first, Andy, nice Angels hat, by the way. And have you installed any new apps this week? I’m curious.

Andy: Thanks. It’s a sneak preview of my Bull Of The Week. I’ll take the prop back out later in the show. I have not installed any apps. I think you’re referring to Threads. I do want to try it actually. Haven’t tried it.

You know one app that I did open that I haven’t opened in a year though, Jimmy, is Gizmo. It’s like this watch that you can give like an eight, nine, 10 year old that they can, it’s like a cell phone, but obviously you don’t want to give your kids a cell phone. and you can text back and forth with them. Like, and they have like 10 pre-baked text messages.

So you can text them like, hello son, do you need picked up from baseball practice? And then they’ll text back like not yet or no, or yes. It’s just like, they just have these pre-baked, but then it lets you do emojis. So I’ll get like not yet poop emoji. I’m ready now, poop emoji. Yes, poop emoji. No, poop emoji. It’s pretty funny.

Jimmy: That is funny. By the way, my daughter actually has a Gizmo watch too, so I’m also a user. I don’t think we knew that each other used the Gizmo app, but the…

Andy: Well, The WealthChannel Podcast is sponsored by Gizmo. No, I’m kidding. But seriously…

Jimmy: Yeah, Otter Pops dropped us, so we had to pick up a new sponsor this week. But you know, my daughter, the number one text message that my daughter sends me is, “I’m ready to go home.”

Andy: Yep, exactly.

Jimmy: And with that, Andy, let’s move into the meat of our discussion this week.

Story number one that we’re discussing comes from Yahoo Finance. The headline is, “US yield curve hits deepest inversion since 1981. What is it telling us?”

And first of all, even a lot of sophisticated investors might not know what the heck the yield curve is. So I’m gonna do a quick 101 crash course. Essentially the yield curve compares the three month, the two year, the five year, the 10 year, and the 30 year US treasury debt. Normally the yield curve slopes upward, meaning that maturity is positively correlated with yields.

Typically shorter maturity bonds have low yields and longer maturity bonds. have higher yields, but since July of last year, the yield curve has had a downward slope, a negative correlation. Shorter maturity bonds now have higher yields than longer maturity bonds. And this is a sign that investors increasingly expect the Fed to raise its benchmark borrowing rates to keep inflation in check.

Now, investors and economists often focus on the difference between two very specific points on this yield curve. Typically the 10-year treasury. and the two-year treasury yields when they’re analyzing the yield curve in its totality. So this 10-2 or 10-2 yield curve, as I mentioned, it’s been inverted for about 12 months now since July of last year, meaning that the two-year treasury has been yielding higher than the 10-year treasury since that point in time. Now, last week, Andy, this 10-2, it inverted to its lowest point in 42 years.

I think the margin was something like minus 109 and a half basis points roughly. So now the last time that this particular part of the yield curve, the yield curve, the 10 minus two yield curve was this negative, was 1981. And the economy at that point in time was in the early months of a recession that at the time turned into the biggest economic downturn since the Great Depression. Brian Jacobson, Chief Economist at Annex Wealth Management, in this Yahoo Finance article had this to say, quote, “It’s not unusual to get a yield curve inversion, but it is unusual to get one of this magnitude. We haven’t seen one like this in quite a while.”

By the way, the last time the yield curve inverted was during COVID just prior to that little mini recession that we experienced there in 2020, 2021, roughly. The 10 minus two yield curve, by the way, Andy, has inverted about six to 24 months before. every recession since 1955, according to a 2018 report by the San Francisco Fed. And it’s offered a false signal just once in that time period. So I think, Andy, that this yield curve is just another data point that shows that we are likely headed toward a recession. Bull market be damned. I think this is a FOMO bull run that we’re kind of in right now.

Andy: Mm-hmm.

Jimmy: I’m still sticking with my pick. I think the S&P 500 is going to be lower at the end of the year than it was when we started this podcast a few weeks ago. Now, Andy, I think we’re definitely headed toward a recession. This yield curve is starting to look pretty nasty. I mean, if you look even at the last 10, 15 years, it is way lower than it was even during the great recession of 15 years ago. Andy, what do you think though? Is this yet another clear sign that we’re heading toward a recession or do you think fears of a recession might be overblown?

Andy: No, I don’t think they’re overblown. I think this is a pretty loud signal that investors would be crazy to ignore. But investors are consumers. And I think consumers and consumers, anyone in the labor force, they already kind of feel this, right? It’s this case of, you call it Jekyll and Hyde, Jimmy, you’ve mentioned that several times in this program. where you hear good economic news in some headlines, and then on the ground level, you might feel something differently, right? Like you hear like, oh, the labor market’s really tight, but then you talk to someone who’s in the labor market who’s looking for a job, and they’re like, well, it’s actually kind of challenging.

Another point I would make, I’ve talked about this bull market that everybody hates, that I did predict, to take credit, I did predict it, but we can be in a bull market, and in recession at the same time. Those two things don’t automatically, you know, are mutually exclusive. And I mean, I don’t know what else the market could possibly say could scream at the top of its lungs that either we’re already in a recession or that one is coming. Am I wrong, Jimmy? I mean, am I overconfident on this pick? But I just don’t think that the yield curve would invert that far and we’re not in a recession.

Jimmy: Yeah, it could be a false signal, but history tends to show us that it’s likely not. I would say, I don’t think we’ve had any negative GDP growth in any of the last quarters yet, but it does seem to be ticking down closer and closer to zero. And I tend to think it will hit negative before too long. Oftentimes these moves by the Fed do have a pretty big lag, 12, 18 plus months or so. We got some jobs numbers out last week, Andy, which looked like good news for the economy, strong jobs, but the market reacted kind of like it was bad news, because that just means that well, if job growth and wage growth is still pushing ahead, it makes it more likely that the Fed is gonna cramp… hammer down… hammer up, excuse me, those interest rates are gonna they’re gonna come hammering down on the economy.

Andy: Yeah. And, and this is where I have to agree with, with manic Mr. Market, you know, I was referring to the old Ben Graham manic Mr. Market. I got to agree with Mr. Market here. Investors who think that the Fed is going to cut rates. I think they’re crazy. The fed’s not going to cut rates. They need inflation to go lower.

They need it to stay low. They don’t really care if we’re in a mild recession for two, you know, two quarters, whatever. They don’t care compared to. making sure that they have inflation under control, especially in the official CPI numbers. So if you’re waiting around for the Fed to cut rates next month or next quarter, I think you’re gonna be very disappointed.

Jimmy: Well, I don’t know if there’s anybody who seriously expects that. I think I read somewhere that it looked like there’s an 80% chance, according to Futures Markets, that the Fed will increase rates at their next meeting. You mentioned the CPI print. We do have a CPI print for the June inflation numbers coming out later this week, Andy. So I’m sure we’ll be discussing that on next week’s episode of The WealthChannel Podcast.

Andy: But Jimmy, to your point about that predictions market though, I mean, I do hear, you know, anecdotally, I hear people talk about, well, sure, they might increase them one more time or whatever, but then they’re going to come to their senses. We’ll be in a recession and they’re going to begin to cut them once it’s clear runners or whatever. No, like I do follow that logic, but you’ll notice that logic requires us to be in the recession, right? So it’s like, they’re pretty much going to continue to hike them. Uh, even if they just hike them a little bit and like, we can already see what’s happened to the real estate market and other corners of the economy with high interest rates has just been a drastic change, right?

And so sooner or later, when you keep, you know, hiking rates, it’s going to have that effect on GDP growth. It might, you know, there might be a lag. It might be six months, might be nine months. It might be 12 months or whatever. It’s going to happen. It’s almost a foregone conclusion. And really, is it not? I’ll ask you this, Jimmy. Is it not required? Is it not a necessity to go into at least a mild recession to truly get inflation under control in a sustained way?

Jimmy: I absolutely think it is. Yeah, I think you kind of have to hit a mild recession. They want this. There’s been too many new jobs created too much wage growth. But but inflation is still roaring. They want to get that back in check. And I think they need to kind of turn the economy around a little bit. And by that, I mean, they need to crater it a little bit, right? They don’t want to crater it too much. They want to hit that soft landing as we were talking about last week, Andy.

But yeah, I absolutely think that a recession is necessary. if you want to accomplish the Fed’s goals and they just hope it’s as soft and as quick a recession as possible, but it’s easier said than done. It’s more art than science oftentimes. Well, Andy, what do you think investors should do with this news, with this inverted yield curve as deeply inverted as it is? How should investors respond?

Andy: Well, historically you might say sell in May and go away, but it’s a little late for that, seeing as we’re in mid-July now. I would say what we’ve already been saying on this program, you want to make sure that your bond allocation is topped up, so to speak. It doesn’t mean that you need to take a lot of risk up the yield curve with longer data maturity bonds. But if you take a look at your portfolio. And after this bull market, if you’re overweight stocks, absolutely, I think it’s would be time to rebalance it. So not necessarily increasing your bond allocation, but, but certainly making sure it’s at least at target. I mean that to me, that’s, that’s the main actionable.

I know in our next story, we’re going to talk a little bit more about how bullish should investors be on bonds relative to stocks, but in general, I’m always going to beat the drum of don’t do anything too drastic. Right. If you have an IPS, if you have a default portfolio allocation, just take stock of it and if anything, you can always rebalance, right. And it’s sort of, it’s psychologically feels good because it feels like you’re doing something, but you’re not really getting out of whack with your stated long-term goal.

Jimmy: Well, speaking of overweight stocks, Andy, that’s a perfect segue into our next story, story number two. Before we get there, as a reminder, you’re listening to The WealthChannel Podcast. This is the show where we explore the world of wealth, money, and finance. Thanks for listening. Thanks for watching.

Let’s move on now to story number two. Story number two is a piece of analysis written by Cavenagh Research at Seeking Alpha, and the headline is, Time to Dump Dividend Stocks. and pile into Treasuries instead. So this analyst from Cavenagh Research in the Seeking Alpha article points out that the 10-year treasury yield, we were just talking about the treasury yields, it’s now trading above 4%. I think right now, by the way, as of the recording of this episode, it’s just below 4%, but suffice it to say, the 10 years at about 4%, the two years at about 5%, by the way, remember that inverted yield curve. Anyways, the 10-year treasury is about at 4%. which has now surpassed the approximately 3.6% dividend benchmark that investors expect from investing in the Schwab US dividend equity ETF.

By the way, this dividend equity ETF from Schwab, ticker symbol SCHD is one of the three largest ETFs in this dividend ETF space. The other two are both from Vanguard. There’s the Vanguard dividend appreciation ETF, ticker symbol VIG. and the Vanguard’s high yield ETF, ticker symbol VYM, all three of these ETFs are yielding pretty significantly below the 10 year treasury right now.

So this researcher goes on to posit that cyclical businesses, which make up a significant portion of the Schwab ETFs investment strategy may not deserve a typically implied growth premium, especially in a potential recession scenario. If we’re gonna enter a recession, why are you paying this growth premium? for these cyclical stocks that might have a lower dividend yield than Treasuries right now.

So, Cavenagh Research, according to the Seeking Alpha article and some of the comments, the comment section is pretty entertaining as well, suggests a tactical rotation. If you’re overweight in dividend stocks right now, maybe it’s worth taking a look at reallocating into Treasuries, they’re risk-free and they’re yielding higher than dividend stocks. By the way, this whole situation, Andy, is really bizarre. If you zoom out. and look at the last 15 years since the end of the last great recession, so to speak, with the yield curve being inverted according to story number one. And now you’ve got these dividend stocks, these high dividend yielding stocks, yielding lower than Treasuries.

It’s kind of crazy, right? Well, maybe not so fast though. If you zoom out, Andy, and look at the past several decades, go back 50. 60 years, it’s actually pretty common that Treasuries will yield more and in some cases, significantly more than dividend stocks. There’s an article on suredividend.com that actually points out that at some points during the 1980s, the spread between the two was double digits. Sometimes Treasuries yielded 10 points or more higher than dividend darlings, including Procter & Gamble, Johnson & Johnson, and Coca-Cola.

So perhaps… I don’t know, maybe the 2010s are the odd period here where investors kind of got in that sweet spot. They kind of got the best of both worlds where they could get higher yields and growth from dividend stocks compared to bonds and Treasuries. Andy, were bonds really that big of a ripoff during the 2010s, maybe the last 12, 13, 14, 15 years? Maybe they’re coming back now? What do you think, Andy? Is this a return to normalcy?

Andy: Yes, I mean, yes, short answer. Yes, I mean, you mentioned the 1980s and we can go through the 90s and the early 2000s. This was a bond market bull run, a huge bull run. I mean, think about asset managers like PIMCO that just rode that wave and became a massive giant. And then you mentioned this last decade of the 2010s. What was going on in the 2010s? Quantitative easing, right? Where we were buying our own bonds and the price of bonds was being manipulated by a Fed that’s buying its own bonds, whereas now we’re finding the true market price of Treasuries.

I think that’s what you had in the 80s. You had more of a true market price and I think that’s what we’re seeing now with quantitative tightening, that we’re not buying you know, as a country, we’re not buying so many of our own bonds. They’re actually selling on the free market. And so I think now they’re finding their real price and they, you know, bonds never should have been yielding. Treasury has never should have been yielding 2%, 2.5% in the first place. It’s crazy. It was always crazy. So short answer to your question, are we returning to normal?

Yes, we’re returning to normal. I don’t know for how long, by the way, you know, I don’t know how long they’re going to allow bonds to yield as much. Once inflation is under control, then I think the goal will be to get interest rates as low as we possibly can get them.

Jimmy: But Andy, you and I have been talking on and off for the last few years about how bonds are kind of a ripoff, right? Are they no longer a ripoff? Are they actually looking pretty reasonably priced compared to stocks? And I don’t know, how should investors react? Do you agree with the researcher here writing this Seeking Alpha article?

Should investors consider a tactical rotation out of dividend stocks or dividend ETFs in this particular case, and just maybe just plowing a bunch of money instead into two year and 10 year Treasuries and you know, riding those yields risk free.

Andy: I think you could do worse. And I think you’re exactly right. You know, Jimmy, if you look in my mind, your investing careers, um, really almost our entire adult life, our entire investment careers bonds were rip off. Right. On a taxable basis, they barely yield anything after inflation and taxes, right. Trip on a triple net basis, a quality bonds that is, you know, you could always, you know, uh, buy junk bonds and eke out a little bit of a triple net return. Uh, whereas now, you know, to me, bonds are more yielding what they should be yielding that, right? So you can actually on a triple net basis, have some positive return.

And, you know, I think you and I probably both need to deprogram ourselves and really anyone in our kind of generation, just that, uh, bonds just yield very little income. It’s just like, this was decades of our lives where they yielded. almost nothing on it, you know, after inflation. And now, you know, especially if we’re going into a recession, the yields that they’re offering look pretty juicy. And so again, I’m not necessarily suggesting investors revisit their portfolio allocation and say, oh, I’m gonna be 60% bonds or 80% bonds.

I’m not suggesting that, but you know, if your target is 30% bonds and that because of this bull market run, it’s down to, you know, 26% in your portfolio instead of 30, for instance, I’d go ahead and rebalance. Absolutely. That is how I would play it. And I think, um, you know, it’s nice to be back to normal, right? You go back and you read some of Ben Graham’s early books, you know, Ben Graham, the, you know, uh, after Warren Buffett or along with Warren Buffett, you know, one of the most legendary investors in United States history, you go back and read some of his early writings. talking about the 50-50 portfolio of bonds and stocks.

And it’s like, for the past several decades, it’s like, well, that’s crazy. How could you have 50% of a portfolio yielding three or 4% when inflation is 3%? You know, it didn’t make any sense. It’s like, oh, now it finally makes sense again, right? Because if you go back to the 1930s, 1940s, 1950s, like bonds yield more than… than the stock market because the stock market has that growth baked in. So again, I think what we’re seeing is a return to normalcy. Maybe we’re going to be in a mild recession and that’s okay. That’s normal as well.

Jimmy: Yeah, by the way, I don’t even know if it’s necessarily just our generation that needs reminded of that. I would say older generation X baby boomers as well. We have that story a couple weeks ago on this show, Andy, where we talked about a lot of baby boomers are probably way overweight in stocks, a lot of them have zero bonds, they have 100% allocation to stocks. And maybe now it’s time to take a serious look at that with bonds suddenly not being as big of a ripoff as they used to be, right? And, and reallocating away from stocks, especially if we might be headed into a bear market, into a recession, and into risk-free Treasuries. I think it’s probably a very wise strategy. So what does this mean for dividend stocks then?

Andy: So Jimmy, I was going to say, you know, one issue I maybe took with the article, if I could have a bone to pick…

Jimmy: Yeah, go.

Andy: … is why are we picking on dividend stocks specifically versus just equities, you know, versus the S&P? Because if you look at dividend or value stocks versus growth stocks since 2006, growth has outperformed. you know, wildly this year, especially, you know, I believe the status, something like seven stocks are essentially responsible for virtually all of the S&P’s positive return, which has been substantial with our S&P bull market.

So I would also say, you know, specifically with value in dividend, anytime a sector strategy like that has underperformed, especially for like a decade or more, if it’s in my portfolio, I’m sort of. I’m hesitant to sort of sell or to say, oh yeah, you know, value is dead after a decade or two of underperformance. It’s usually when it’s, you know, if you can be patient, it’s going to have its time in the sun again. So I might say the point is true with, you know, bonds specifically, much more attractive of an asset class, but we don’t need to go picking on dividend stocks.

Let’s just pick on like SPY or the total stock market. Um, because I think if you, if you, if you continue on that thread, while growth is where it’s at, Dividend stocks are dead. That’s going to be true until it isn’t. And then the way this thing tends to work is there’ll be a decade or two where growth outperforms and then a decade or two where value outperforms. Right. And so we’ve had a decade or two of growth outperforming. So I think dividend stocks might be due, might be on the other side of the next recession when they truly begin that run, but I think they’re due.

Jimmy: Well, the S&P 500 is no longer even a broad based index, right? It’s a mega cap tech growth index, basically, based on just the performance of those seven tech stocks over the last several months here, a year and a half or so. I jest somewhat, but no, Andy, I think you’re absolutely right. I think dividends, and I would say this, by the way, if you’re a very hands-on investor and you buy and sell out of positions pretty frequently, Maybe you consider this tactical rotation.

I think if you’re a long-term buy and hold investor, I don’t know that I would necessarily lose any sleep over your weighting and dividend stocks versus Treasuries. I would look more high level, just your overall allocation, bonds versus equities versus real estate versus other alternatives and make sure that that’s still in line like you normally would every year or so when you’re doing your rebalancing. But for most people, I would say a tactical rotation might not be super necessary here. And if it is for someone who’s more hands-on, really just consider it to be a short-term tactical rotation, not a huge change for the long-term. What do you say there, Andy?

Andy: Totally agreed. Totally agreed. And man, that comment you made about what the S&P is now, just, you know, like seven mega cap growth stocks, along with some other riff raff on there. Boy, that’s a good segue to our last story, isn’t it?

Jimmy: I think it absolutely is. So, well, let’s talk another tech stock. Let’s talk Meta, which is one of those big seven stocks in the S&P 500. This story comes from Barron’s. The headline is, it’s all about Threads. What the heck is Threads? So Threads hits 100 million users faster than chat GPT. Now it needs them to stay. This is according to Barron’s. Andy? I think this is round one of that cage fight between Elon Musk and Mark Zuckerberg. Am I wrong? Well, okay, maybe I’m kind of kidding, but not really, because the punches have been thrown a little bit this week.

So last week, Instagram launched Threads, which is a new microblogging app, or in other words, it’s a Twitter clone, essentially. The app didn’t even exist a week ago when we recorded last week’s episode, Andy, and now it has a hundred million users already. 100 million users in just five days makes it the fastest growing consumer app in history. Twitter has already threatened legal action against Meta in a letter to Mark Zuckerberg. Twitter’s lawyer accuses Meta of engaging in quote, systematic, willful and unlawful misappropriation of Twitter’s trade secrets and other intellectual property.

Now, according to Barron’s, this Threads versus Twitter. is likely to be much more than a winner takes all contest than chat, GBT and Bing versus Google. The writer of this article says that users will naturally gravitate toward whichever social media network is more active. I don’t know if I agree with that there, though. I think that what’s happening early on here, at least, Andy, I’m curious to get your thoughts in a minute, but first of all, Twitter has this enormous first mover advantage, right? They have…

Andy: Mm-hmm.

Jimmy: …hundreds of millions of users currently. And I think it’s gonna be a big, it’s gonna need some really big effort by Threads to pull alongside Twitter and to overtake them. But I don’t know if they’ll ever be able to fully overtake Twitter, but I also don’t know if it’ll be a winner takes all type of thing. I can envision a scenario in which Twitter leans one way politically and Threads leans another way politically. And you just kind of segment your users. based on politics, a lot like the rest of the country is going, a lot like how network TV and cable news shows go these days.

I wouldn’t be surprised if a year from now, maybe Threads was the left leaning microblogging app and Twitter was the right leaning microblogging app. I can be totally wrong about that, but I do think Threads is gonna get the backing of big media and they’ll probably attract a lot of advertisers. They have a huge boost from their current user base of. Facebook and Instagram users. But Andy, what do you think? What do you think about my take that we could end up getting a split, maybe not a winner take all? And is Twitter in trouble here?

Andy: Uh, yes and yes. And I do want to full disclosure to our audience. I hadn’t used Threads, but Jimmy, while you were giving us the summary of that story and then asking me that question, I had time to download Threads from the app store, sign up. It already like preloaded my Instagram handle, imported all the people I followed on Instagram, and then I was already scrolling through all your time. I was listening, but I was already scrolling through it. So that’s just a little…

Jimmy: And you’re the 100 million and first user now.

Andy: Yeah, it’s a little testimonial though of how easy and fast it was to onboard. You know, you don’t, you don’t even have to enter your email on a password. I mean, it was fast. It was seamless from the old app store. And I think you hit the nail on the head. If you go back all of these sites, but especially Twitter, all of these sites, number one, celebrities are a big part of making their platform, you know, when big name celebrities, uh, you know, whether in music or sports or whatever use a platform. tends to build buzz and bring a lot of consumers in.

The other thing with Twitter specifically was journalists, right? It was like the platform of choice for journalists, whether for niche media or for just, uh, you know, mainstream media and take, take celebrities, you know, uh, what, what percentage of celebrities are left leaning, you know, probably the majority take journalists, what percentage of journalists are left leaning. probably what, 98, 99, 99.5%, some just obscenely high proportion. So I think instantly, I think there was this whole cohort of people still using Twitter because there was no viable alternative who were left leaning. But as soon as there was an alternative that had viable mass that was credible, and that’s kind of a big point, right? I think they are already on Threads.

Whether it lasts, I don’t know. But I would certainly be worried if I were Elon Musk, if I were Twitter, I do think this is a serious competitor. And I think, you know, a lot of journalists were continuing to use Twitter just because there was nothing else. Well, now there’s something else. It has critical mass. It’s easy to sign up, it has 100 million users. So yeah, they’re in trouble, Jimmy. Twitter’s in trouble.

Jimmy: Yeah, the Barron’s article points out that it looked like for a while, maybe Google would be in trouble because ChatGPT and Bing might overtake it and that just never really came to fruition. The user base of ChatGPT has dropped off over the past couple of months. I guess maybe the appeal of the shiny new toy has kind of worn off for it. I wonder if that might happen with Threads as well.

Maybe, I don’t know though. It’s really early to tell still, but I guess, I’ll go out on a limb and I’ll predict, I do think Threads is here to stay. We’re five days in, by the way, I did log in very briefly, Andy. I think the day it came out or the day after it came out, I downloaded it and checked it out just for a couple minutes. I haven’t posted there yet. I just wanted to see what it was all about. I’ll probably log in again after this episode and dive in a little bit more. But getting the backing of Facebook, Instagram, the whole meta machine.

I think this is going to have a lot more success than say Meta’s previous endeavors into the virtual world, whatever that was called. That never ended up going anywhere. I think they’ll have a lot more luck with this one though. And if they put the right investment behind it, I think Twitter’s in trouble as well, Andy. I totally agree with you. Any last thoughts on that, Andy? And where are you going to gravitate toward? Given your two minutes on Threads, do you think you’re going to leave Twitter forever and go to Threads now?

Andy: I don’t know. I just kind of have to laugh at the whole situation because rewinding with Twitter, you know, thinking back two years ago or whatever, the heyday of the Twitter trust and safety council, like they had built up Twitter into this like heavily censored environment where right-leaning viewpoints, right-leaning accounts, like the Babylon B I think, a parody, like a humor site that it was parody that was right-leaning was banned or shadow banned. I mean, it just became absurdly left leaning and censorious. And then, you know, obviously Elon Musk took over and they’ve been more…

Jimmy: And I think before that wasn’t the leader of the free world banned from the app as well?

Andy: Yeah, yeah, you know what? Yeah, good point. And then right and then must took over and basically said it’s going to be the free speech platform. Certainly, it’s not totally free speech. You know, there’s still rules, but it’s a lot more free than…

Jimmy: And there’s some downside to free speech, if you ask some people, right?

Andy: Right. And honestly, I think in some ways, the user experience has gone downhill, if I’m giving it an honest appraisal. But in other ways, the lack of censorship makes it, for me, makes Twitter more fun. But isn’t it, I just, I don’t know if irony is the right word, but it’s funny that Twitter was used as this kind of ideological battleground, where the left had created this sort of censorship regime, where they were enforcing through the trust and safety council or whatever, and with the COVID narratives and all this stuff.

And then Elon Musk did this takeover and became kind of a hero to the libertarians or the right or whatever. It would be kind of humorous then if the left now has its own version of Twitter. And then now there’s just these two giant echo chambers. Right, that just that idea that might possibly happen. It just kind of sums up where we are as a culture and, you know, with this kind of tribal ideological camps, it seems like it would be very fitting, Jimmy. It would somehow be very fitting.

Jimmy: I agree with you. And I think that is where we’re headed as long as Threads doesn’t collapse. It’s brand new. If the shiny toy syndrome doesn’t wear off and people get sick of it and just end up all going back to Twitter, I could potentially see that happening. I don’t think everybody’s gonna leave Twitter to go to Threads, but I do think it’s possible that Threads is the new kid on the block. People could lose interest in it and just return to Twitter or not return anywhere.

But I tend to think we are gonna get that. I think we’re gonna get. two echo chambers. I think we’ll have plenty of people who are on both platforms, but I do think one will skew one way more politically than the others. I think you and I see eye to eye on that, Andy, and very amusing how that would end up being if that all does come to fruition.

But Andy, we’re kind of running out of time here, so let’s hit the home stretch. It’s time once again for this week’s edition of the Bull Of The Week. And this one we’re gonna take a little bit different twist on it with Major League Baseball’s All-Star game taking place on Tuesday night. Our bulls this week are baseball. So we’re gonna have two baseball-themed Bulls Of The Week. Andy, you’re wearing your Angels hat there. Go Halos, I guess. What’s your Bull Of The Week this week?

Andy: Yeah, I could have worn the Tigers hat, but you know, I want to show that I appreciate the entirety of the American league, right? So obviously the AL is going to win. How many years straight has it been? Eight or nine? Um, and really Jimmy comes down to two words. Show. Hey, Oh, Tony, right. He’s the starting DH his first step bad. I predict he’s going to hit a bomb, the left field, and then he might even come out like he did in the world baseball classic. He’ll come out in the ninth inning as the closer to close out the game. I’m picking American league 10 to one with a big victory.

Jimmy: Wow, huge. I don’t know if you bring in your closer when you’ve got a nine run lead. And also I believe Shohei

Jimmy: Ohtani is still nursing a blister on his finger. He will not be pitching, it has been announced. But he is expected to get a couple of at-bats at least.

Andy: Ugh.

Jimmy: So I don’t know. By the way, your other big Angels guy, Mike Trout, he is out with an injury. So I don’t know about the Angels hat there, Andy. I’m gonna go with the Nationals… the National League, I should say. Go ahead.

Andy: He can still bat with the blister, right? You’re telling me you just kind of took the wind out of my sail.

Jimmy: He can bat. He’s going to bat, but I think he’s not going to pitch for probably a couple more weeks.

Andy: Okay. Fair enough.

Jimmy: So I don’t know about your bull pick there, Andy. I’m going with the National League, as I mentioned. We’ve kind of grown up in my family being National League fans. I grew up in Los Angeles. We were Dodgers fans. I lived in Chicago for a while and adopted the Cubs. My son is a big Mookie Betts fan for the National League and the Dodgers. So we’re pulling for the National League over here.

And I got to say. I know the designated hitter rule has now been adopted by the National League as of what I think it was last year. This is the second year that it’s been in place. But I always remember my grandfather complaining about the American League when they adopted the designated hitter rule before I was born and saying that the AL teams played by what he termed as girls rules. So that always kind of stuck with me.

So I’ve always been a National League fan since then. So I do think the National League will pull it out. By the way, this is despite the fact that My local Texas Rangers team, they have five starters on the AL. Maybe that’s a bear sign if nothing else. But fun fact about the Rangers, just to get in the plug for my hometown team, despite them being an AL team, they’re gonna be the first team in 47 years to start five position players in the All-Star game. How about that, Andy?

Andy: Yeah, Jimmy, that’s on the same league with the Tampa Bay Rays, by the way. So, I mean, it’s even crazier that they have so many starters on this team because there’s some strong talent in the American League.

Jimmy: Yeah, it sounds like there aren’t a lot of good teams in the AL. They gotta just allocate all the players from just two or three teams there, right Andy?

Andy: Well, if there are good teams, they’re not in the AL Central. So I’ll just leave it with that.

Jimmy: That’s true. Well, Andy, this has been fun. We’re out of time for today. We’ll see what happens in the Midsummer Classic this week and we’ll come back next week to do it all over again. What do you say?

Andy: Sounds great.

Jimmy: Thanks for listening to today’s episode of The WealthChannel Podcast, the show where we explore the world of wealth, money, and finance. As a reminder, you can find us online at wealthchannel.com/podcast. The WealthChannel Podcast is available on YouTube, Apple, Spotify, and all other podcast listening platforms. Just hit that subscribe button so you get our new episodes every Tuesday morning, and we’ll see you next week.

Andy Hagans
Andy Hagans

Andy is co-founder and co-CEO at WealthChannel.