We’re back baby! But normal might not look the same going forward. It’s possible that the pandemic has changed certain behaviours. That will be good for some industries, bad for others, and just generally change the rules for many more. Maxx Chatsko joins Dan Kline to break down how this might work for investors. We’ll also check in on Intellia Therapeutics and take your questions.

Companies Mentioned

Moderna, Inc (NASDAQ: MRNA)

Crispr Therapeutics AG (NASDAQ: CRSP)

Intellia Therapeutics Inc (NASDAQ: NTLA)

Southwest Airlines Co (NASDAQ: LUV)

Walt Disney Co (NYSE: DIS)

BJ’s Restaurants, Inc (NASDAQ: BJRI)

Restaurant Brands International Inc (NYSE: QSR)

Comcast Corporation (NASDAQ: CMCSA)

Netflix Inc (NASDAQ: NFLX)

AMC Entertainment Holdings Inc (NYSE: AMC)

Dave & Buster’s Entertainment Inc (NASDAQ: PLAY)

Apple Inc (NYSE: AAPL)

Transcript

Sam Bailey  

Welcome to 7investing Now, a show that teaches you how to take a long term view on investing by better understanding what’s happening in the market now.

Dan Kline  

Good afternoon 7investors and welcome to the Monday edition of 7investing Now. My name, of course, is Daniel Brooks Klein, I’m the host of the program, I will just say for me it is t-minus four days to my first time back on a cruise ship in 16 months, something like that – a year ago, February for the Super Bowl. I’m being joined today by Maxx Chatzco. Maxx, I want to talk about a couple of things at the top of the show. First, we were talking about dental work before the show and when you get a tooth implant and I asked the question, do you get the option like a spy to have that little pack put in so if you’re captured, you can opt to off yourself so you don’t you know get tortured to reveal the secrets. That’s not my question. My question is, why do we not have more accidentally dead spies? It seems to me like you’d have that in your mouth. Like I bite my tongue all the time. It feels like I wouldn’t go a week without accidentally biting my my anti capture pill or whatever you call it there.

Maxx Chatsko  

Well, Dan, that’s why they’re spies. And you’re not. It’s pretty simple.

Dan Kline  

That probably makes sense. Maxx, did you have fun this weekend? I I had fun at the end of the week. Last week, I went to Hollywood studio. So it was kind of a working slash exercising weekend for me. Did you get to do something fun?

Maxx Chatsko  

I did. I went out some friends. I’m really enjoying everyone being vaccinated. And just having fun again, like last last summer was kind of brutal. You know, you’re way more social than me. And I’m sure it was painful, painful for you, Dan.

Dan Kline  

Yeah, it’s I don’t even like to think about it. Because as you know, I am someone that likes to be in front of people. I spent a lot of my time traveling, I would visit the office back when I worked someplace that had an office, which was not a requirement of my job. But I like doing podcasts in person. I like scheduling 12 different coffees a day. And sometimes the coffee was so good, I would drink eight or nine different coffees a day, which is something I no longer do. That being said, I want to ask a question about vaccines. You brought up people are vaccinated, I think you should take a little bit of a victory lap here, because you have been the first person I’ve seen very publicly in media saying, we will almost certainly not need a booster shot anytime soon. And right now you’re seeing more and more doctors say that. You’re seeing more and more tests show that we’re likely to have years of immunity. And the only people calling for booster shots are the CEOs of companies that make vaccines This is a little bit like the CEO of McDonald’s coming out and saying if you don’t have a Big Mac a week, you’re gonna die. So it’s probably the opposite. But Maxx, your thoughts here?

Maxx Chatsko  

Yeah, I mean, early on, you know, the focus initially in the media, maybe around, you know, the general population was on antibodies, right? Do you have antibodies? Before the vaccines came out? Everybody’s focused on do you have antibodies if you’re infected, how long do they last, and the thing with, you know, if you get infected with the virus, or you get the vaccine, antibodies are only part of your immunity. So, you know, B cells are more important. T cells, certain types of T cells are more important. And it stood to reason that, you know, even though we couldn’t detect antibodies in your blood, to neutralize virus particles, you would still have, you know, B cell memory and T cell memory. So, like years from now, if you get sick with something similar, that would ramp back up, and you’d produce antibodies again. So, you know, it’s like you said, when CEOs are talking about we need boosters, and they’re already investing in new facilities, and and I think Moderna (NASDAQ:MRNA), even as I already have a contract with the US government, I hope it’s optional so we’re not wasting more money, but it’ll be interesting to see how that how that goes. If you don’t need it, then you know, why should we be paying for it?

Dan Kline  

I pity the fool who don’t have T cells. To take us back to the 80s. A little bit there. That is not our main topic for the show. Today, our main topic was going to be investing in the recovery, we’re absolutely going to talk investing in the recovery. But Maxx, the internet is a kablooey. All of Twitter is filled up with talk about CRISPR. And by the way, it’s very weird to see people who don’t have any sort of medical background, talking about CRISPR  (NASDAQ:CRSP) and how much money they’re making. But we did actually have some monumental news over the weekend. Can you put it into perspective, and maybe the word monumental is is to0 big a reach, but can you give us some perspective on what we saw this weekend?

Maxx Chatsko  

Yeah, so we actually talked about this on Wednesday show I think it was. So we kind of set it up, right. We knew that on Saturday, it would be a data readout. This is the first time we have data from a CRISPR gene editing tool that’s been used inside of the body. So a company Intellia Therapeutics  (NASDAQ:NTLA), as everyone in the world now knows, released data over the weekend and the first six patients in a rare disease called hATTR. So this was a CRISPR gene editing knockout, meaning they were trying to silence a certain gene. So in this disease, a protein called TTR misfolds. It’s mutated, and it accumulates in certain organs in the body. And it causes disease, it can be fatal if it’s not treated.

So their idea is, hey, we’ll does knock out this gene, so you’ll never make that protein. So in the first six patients that were tested, and this is an ongoing phase one clinical trial, so it’s still very, very early. But it appeared to work very, very well. In the lowest dose tested, we saw the average protein reduction was about 53%. So that’s not optimal. That’s not even better than treatments on the market today. But in the middle dose tested those three patients on average protein reduction, about 87%. So that’s exactly very competitive with what’s on the market today. And then there’s a higher dose, they want to test because they didn’t see any worrisome safety issues from those first two doses, they’re going to test an even higher dose, and even get even higher levels of protein reduction.

Dan Kline  

So we welcome your questions and comments, we appreciate the comments that have come in a few of them are a little off color, so we are not going to share them. But we do appreciate them. We would love – Say hello. Ask us a question about about intelligent therapeutics ask us about CRISPR. I’m not gonna answer those questions, Maxwell. So Maxx – testing on six people? How far from testing on six people to clinical trials? Or? Or is this even treating something that’s broad enough that you’re going to be able to have all those steps?

Maxx Chatsko  

Yeah, so I think, right, this is still very early, we have to say that, right. But it’s also different from other therapeutic modalities. You know, if I gave you a pill for like asthma, or cancer or something, and it’s an oral medication, it’s a small molecule. And it’s relatively sloppy, it’s not very precise. So that’s why we have to test it in like hundreds of patients, before you have a good idea of is this safe, is this effective? How effective, how safe? But with genetic medicines, they’re a lot cleaner, they’re a lot more precise, we’re going as far upstream as we can, you know, we’re treating the root causes of diseases. So this was a pretty big data readout, because again, it’s the first time we have this for in the body – inside the body for CRISPR tool. And the platform that Intellia Therapeutics has for knockouts, it’s one of its three pipelines. You know, there’s no reason to think that this won’t work for other genes that we might want to target within the liver.

So the markets rightfully excited to assign higher probabilities of success for the company’s drug candidates. And that’s how we value early stage drug developers, you don’t have revenue, we don’t have earnings, you don’t have cash flow. So the net present value calculation is looking at trying to estimate what’s the probability this reaches the market and generate some money? So these enormous increases – all six publicly traded CRISPR stocks are up about 10% or so – some of the font a little bit below that. But you know, it’s like, everyone’s really excited about CRISPR. Because we’re saying, Oh, this is gonna work like gangbusters, right? So again, it’s like tempting to think, well, this is only six patients, we have to be careful. And we do. But we have to ask different questions than traditional drug development.

So we need to look at you know, longer term safety issues. The thing with CRISPR, that’s great. Any gene editing modality is that it’s, you know, one and done, we’ll give it to you once we get into the genome. And that’s it, get out of my office, right. But if something goes wrong later, well, there’s no undo button, we can’t stop treatment, you’ve already been treated. So these long tail safety risks are something that might, you know, catch up later to CRISPR something that investors have to keep in mind. So it’s tough, it’s, it’s a totally new territory, we have to we have to value these things properly. But if something goes wrong later, it’s gonna be really hard for them to come back from that.

Dan Kline  

So Maxx, are we more likely to see this technology used to treat things that are deadly or seriously debilitating, because in theory, if you have a cancer that’s going to kill you in the next 18 months, you’re not that concerned about whether 10 years from now your eyes are gonna fall out, they might be able to find a treatment for that in the interim. Is, is this technology may be going to first be used in just preservation of life to, to, you know, help you limp along to the next day?

Maxx Chatsko  

Yeah, so it’s important to point out the the limitations of what we’re doing now. So this data was in for a CRISPR knockout in the liver. So we can’t target other organs yet. And you want to do things that are way more precise than a knockout. A knockout is relatively sloppy. So we will use it in other diseases and other organ systems to silence gene expression and other parts of the body or to alter gene expression, I should say. So yeah, I mean, it’s going to make its way into more prevalent diseases and all genetic medicines will, so like today we’re treating rare diseases sometimes there’s only 10s of 1000s of patients or fewer globally in the US that have these diseases, but eventually we’re going to start treating things like you know, cardiovascular risk reduction, or alcohol use disorder, which is alcoholism. Other things that are way more prevalent. Certain types of cancers could eventually be used directly, you know, with CRISPR RNAi or something like that. So, yes, you’re right, but it’s still like ways away right now, Dan,

Dan Kline  

Are we talking years? Are we talking decades?

Maxx Chatsko  

Ah, sometime this decade, we should start to see those enter clinical trials. I don’t know, again, the success rates of those. But, again, if we could just talk about maybe the long tail risks a little bit.

Dan Kline  

Yeah, that was gonna be my next question. Investors are kind of getting ahead of themselves here. That doesn’t mean these aren’t good stocks to own. But there’s there’s long tail risks. And you’re also you’re not gonna see actual revenue for quite a while, right?

Maxx Chatsko  

Yeah, so there’s a couple different risks. One is commercial risks. So there are treatments available for these things – for gene silencing, that comes from RNAi, they might not always be better, but they do offer very similar benefits to patients. The caveat is you have to take them more than once, right. But there’s simple shots, so subcutaneous dosing, and they’re working on spacing out the dosing more than current treatments. So right now, everyone’s comparing what the Intellia drug candidate NTLA-2001, which is the thing over the weekend that had data to a treatment called Onpattro. And this is you have to get an IV every three weeks, it’s very inconvenient for patients, there’s actually another RNA treatment, in developments actually probably going to get approved in April 2022, or sooner. It’s called Vutrisiran. And that’s a sample shot, and you get it once every three months. And then that company is actually looking at maybe dosing and once every six months, and then as a newer technology platform, that’s not going to enter clinical trials until the end have 2022. But it might be as simple shot once every 12 months, so that it kind of starts to look very convenient for patients, right. And if there are long term safety risks from permanent edits to the genome, then maybe that simple shot – this reversible treatment starts to look a little bit more attractive.

Now we’re looking at the long term safety risks or the long tail safety risks. So that’s just the way that CRISPR works, right? Everyone’s familiar with like DNA, right? Double stranded helix, right? Everybody knows the shape, so the two strands wrapped around each other. Now CRISPR gene editing works by cutting both strands of DNA, so we call it a double stranded break. So we get in, and it can precisely target a gene on the genome. So when we say it’s precise, that’s what we mean, we can precisely target that. However, we rely on natural repair mechanisms to stitch the genome back together, if we cut your genome in half down, that’s not very good, you’re not gonna make it very far. So a double stranded break is actually one of the most traumatic events in biology. And that’s where some of the long tail risks come in. So we’ve already observed in the lab that using CRISPR, gene editing, and then waiting on those natural repair mechanisms to come in and stitch the genome back together, we’ve observed that there’s random insertions of genetic material, random deletions of genetic material, and also something called chromosomal translocations, which is larger parts of your genome are just kind of randomly swapped in and out for one another. Each three of those things, insertions, deletions, and translocations, are all hallmarks of cancer. So you know, there’s this long tail safety risk that yes, initially, the data look great. And in clinical trials, these looks amazing. It’s one and done.

But maybe years later, maybe even after clinical testings done, or after these things are already on the market, a higher number of patients start to develop cancers, because they were treated with CRISPR gene editing. So there’s this long term risk like and there’s nothing that CRISPR gene editing can do to fix that. It works by making a double stranded cut. So if that becomes a problem, then this therapeutic modality is kind of dead in the water. So that’s where there’s a little bit more excitement for things like CRISPR based editing, it doesn’t use a double stranded break. And there’s other gene editing systems that don’t rely on double stranded breaks. So there’s a lot more nuance to this, it’s not like you know, CRISPR is going to, you know, cure all the diseases, and we never have to develop another medicine again. So we do have to be careful. But at the same time, you can see why there’s excitement and why there’s a steep adjustment higher to a lot of these market valuations. It does make sense, it’s also early, so you have to kind of acknowledge both things.

Dan Kline  

Chromosomal translocation is on my list of fantasy football team names That is absolutely going on the list. Maxx, let’s have the last word here. When you invest in a stock like this, there is significantly more risk than when you invest in an established stock, you know, yes, like, tomorrow, I’ll pick a random company, target CEO could come out and say something terrifically bad, and that could really hurt the company, but you can fire him and move on and it’s going to be fine. This could end up having some of these companies fail, some of this technology fail, or alternate paths be developed that make this type of – I don’t want to say risk, but right now, experimental technology might make less sense. So as an investor, how do you look at this?

Maxx Chatsko  

Yeah, well, this is kind of new territory. You know, I think what we can say is a lot of, you know, genetic medicine, therapeutic modalities, right? They do seem to have very high probability of success. So we can design them to be pretty simple and rationally design them to work. And then when we observe that they work in the body, we know we can translate that to other diseases. So this is new territory, and it requires new thinking new models, new questions to be asked. So yeah, I, I don’t know.

Dan Kline  

Beware the person selling you a CRISPR gene editing kit on Facebook. That is something to be careful. I want to take the comment from Chris B., it’s going to be a good way to segue into a little bit of a promo here: “as a healthy skeptic, what proof or milestone would it take for you that would be Maxx, to recommend a CRISPR company for 7investing? Now, if you are a member of 7investing, you would know whether Maxx has ever recommended a CRISPR company. Has he? Maybe he has, he hasn’t. It is hard to know, because you’re not a member, you don’t have access to our picks, if you would like access to our picks, up until July 7, that is perilously close to now – less than two weeks away, you can join 7investing for $49 a month or $399 a year. If you do that before July 7, I’m saying it in the be wary voice because it changes on July 8. If you do that you lock in that pricing forever. As long as you continually stay a member.

If you wait till July 8, our prices are gonna go up to $49 a month, or $399 a year. Why? Because our service is worth more than that we’ve expanded exponentially. We’ve gone from a handful of advisors to 7 advisors, we’ve added our member only calls, which is a 90 minute Ask Us Anything about our picks. We do a new member onboarding call, I did a one on one call with a member this week, because after exhausting all of those options, he still had some questions about the market. We are a high service company. We don’t promise to do that with everyone but there are cases where that makes sense where a person has really put in their work and still has the questions. So if you’d like to become a member, join us at 7investing.com/subscribe.

We’re going to pivot a little bit here we’re going to we’re going to play what I call a bit of a game, I’m going to throw out a bunch of sectors/investable areas. And we’re going to discuss how we think those areas will do as the country slowly puts the pandemic behind it. It is very strange that we’re like sort of post pandemic, like I mentioned at the top, I’m going on a cruise this week. But I don’t legally have to show I’m vaccinated. But if I don’t show I’m vaccinated, I can’t go to the casino. I can’t go to my the piano bar or the pub or two of my favorite places on board. There’s all sorts of rules. And this is sort of the endless battle with the state of Florida, because they would like to actually be able to require it. But you don’t know every place you go, I have the mask in my pocket or in my hand because some places are still requiring it. It is confusing, but the world is opening up. So let’s look first at airlines. Now. airlines are really weird – have you tried to book a flight anytime recently, Max?x.

Maxx Chatsko  

No, not yet.

Dan Kline  

So I have a flight to North Carolina in a couple of weeks. And then to Birmingham, Alabama for a wedding. And my flights have been changed like 15 times my connecting city has changed. And it’s because the airlines are dealing with capacity things. But as an investor, I know this isn’t your space. Do you think travel goes back to normal and airlines will get back to growth at some point?

Maxx Chatsko  

Man, I know nothing about airlines as far as the businesses but I do think is gonna be healthy this year. Right? There’s a lot of like pent up demand people want to get out. Maybe by 2022, it starts to go back to normal. But I don’t see any reason why, like travel will be permanently dented. I think people are still going to go on vacations and fly around the country and all that.

Dan Kline  

Yeah, I think that’s the answer. It’s largely same as it ever was. But it’s going to be reported as an increase this year. Why is it going to be reported as an increase is every airline except Southwest  (NASDAQ:LUV), or every major airline except Southwest laid off or furloughed workers. And even in the case of Southwest, they I don’t want to say encouraged early retirements. But you know, they certainly worked with their union to get some people who wanted to retire early to retire early. There is a shortage of personnel, there is a shortage of planes. So in a lot of cases, routes I used to fly regularly, just aren’t there. So you’re not gonna have trouble getting from, you know, LaGuardia to Orlando, but I’m having a lot of trouble getting from West Palm or Fort Lauderdale to Charlotte and Birmingham and home and all the different things to the point that at some point, I was like, how long a drive is this? Like I know it’s about 10 hours to North Carolina. You know, and then Birmingham is about five hours from there, but then the ride home would be pretty, pretty brutal.

So yeah, and I think everything we said there, these weren’t investable In my opinion, before the pandemic. Some people will make a case for Southwest – I like Southwest as a business. I don’t like the endless cycle of investment. I don’t like that fuel prices are very volatile and part of their business, I don’t like that there’s a lot of low cost competitors coming in. And I think everything I just said about airlines largely applies to hotels, we are going to see a big bounce back in the hotel space, because some hotels are still closed, I was just at Disney World. And I don’t know the number, but like half the Disney  (NASDAQ:DIS), properties, including some very major ones are still closed. They used a lot of this time, you know, to go back and revamp some hotels, to re-theme some hotels,to do some work that’s very hard to do when you’re at capacity.

But Maxx, I know you’ve been in some bars and restaurants in recent months. And, you know, there’s obviously a fair amount of public companies in the restaurant space, I’ll give you one that I like is a business but not as an investment. And that would be BJs  (NASDAQ:BJRI),, the restaurant chain, they they’re sort of in my opinion, the best of the Chili’s, Fridays Applebee’s, all of which are part of publicly traded companies. That being said, I see demand coming back, I see it as high. I think you’ve got to be best in class in restaurants to be investable. And that is a a very short list. You know, you could you could give me Chipotle? I’m not sure even though I like BJ’s, I’m not so sure that I see that as as a good long term business, even as people do go back out to eat. But back to your thoughts. Are people going to eat at home more? Or are they going to flood the restaurants?

Maxx Chatsko  

They’re going to go into restaurants and be pigs for sure. At least it’s like where I live, though. You know, I live in a city. And it’s like, you know, the cool hip thing to go to like the local scenes, not the big chains necessarily? Is that a big impact to you?

Dan Kline  

So yes, and no, West Palm Beach has a mix of both. There’s definitely there’s not a lot of like one-off local restaurants, except for very nice ones. There’s a lot of like, let’s call them regional chains, where they have maybe like six or eight or even like 20 or 30. And I do think there’s some preference for people to go to those. But there’s also a lot of tourism here. There’s a lot of you know, there’s a lot of people that yeah, it’s like I could go to the hip downtown restaurant, but it’s Tuesday night – I’m just gonna I’m just gonna get you know Buffalo Wild Wings and eat in. Orlando where we have our second place, or Davenport, Florida to be technical. bordering on Kissimmee, it’s hard to find a local restaurant, it is a land of chains, and hotel restaurants. And you can find some good hotel restaurants, which is, which is actually pretty rare. But again, I think there’s going to be a comeback.

I don’t think you can make any investing decisions based on the next 12 months of data. Because the pent up demand, the pent up savings, all the stimulus money, an awful lot of people want to go out and and I’ve told this story on air, my son and I went to an On the Border, which I don’t think is part of a publicly traded chain, but I’m not sure. And the restaurant was empty. And they told us it was 20 minutes to sit. And that’s because they didn’t have enough waitresses, or waiters or servers or whatever you’re supposed to call them these days. That I think is going to make it look like – there’s going to be a lot of factors making these industries look more successful than they are. So if you weren’t going to buy shares in you know, Restaurant Brands International (NYSE:QSR) or dine equity or whatever it is, before the pandemic I’d be very wary of buying them now.

We’d love your questions, your comments your thoughts about the reopening It is a very quiet audience out there. Maxx, I’ll  throw out this one and I can have the answer: theme parks. I think theme parks are going to be incredibly resurgent because on a local level say a Six Flags is very very affordable. And on a national level, which really means your  Walt Disney worlds, your Disneyland, SeaWorld (NYSE:SEAS) and Universal Studios. I think the pent up vacation demand is very high. But again, I was at Disney and it was crowded, but it’s not at full capacity. They are selling out their Halloween extra ticket event at Disney. I’m sure Halloween Horror Nights at Universal Studios will do well. But we don’t know what the capacities look like. We don’t know when they get back to full. Legally they could be at full. The reason they’re not at full is if you went to Disney World and all of the big ticket theatrical productions and sing alongs and other things and stunt shows and other things that just eat up crowds. If those aren’t happening, you can’t – the park won’t operate. It would be like a four hour line for everything.

I mean, I waited 45 minutes, a 45 minute line at Starbucks. So that is a problem. I wish someone had just told me there was a coffee kiosk like two minutes away that had no line. So I think theme parks are going to have a huge bounce back year. But the actual revenue being better is probably going to be starting the holiday season when we’re fully open, when the flights are in place. The other big barrier we have – I don’t think this hurts Disney as much but it definitely hurts Universal Studios and SeaWorld – rental cars are crazy expensive for reasons we’ve talked about – there’s a shortage of them. So you know, are there investable plays here? Like, yeah, I think I’ve made it no secret that Disney is one of my favorite companies. And Comcast  (NASDAQ:CMCSA), is one of my least favorite. Comcast owns Universal Studios. Both Six Flags and SeaWorld are publicly traded companies. I’d be very, very wary those were not well run. I don’t want to say not well run companies – the actual business of those places was not well run, like maybe their corporate is great. But they’re in park experience is not magic.

Maxx Chatsko  

Do they still have have like higher expenses for any health mitigation things? Or no?

Dan Kline  

My guess is that’s almost entirely gone away. I don’t know. They might be providing masks for staff that can’t be that significant of an expense at a place that already provides uniforms. There’s extra cleaning. So there’s  definitely that but there’s also less  cleaning. I stayed in the hotel for a few days. And they don’t do maid service unless you specifically request – I think if you stay a certain length, they come in. I know in other places I’ve stayed during the pandemic, they bring you like a new bundle of towels. But they don’t come in and take the old ones. I guess you could leave the old ones outside. So yeah, the results are going to be hinky. And I think that’s going to be true for the next one here. Maxx, what was the last time you were to a movie in a theater?

Maxx Chatsko  

It’s been a while, obviously. But I don’t know, I couldn’t even tell you the last movie I saw maybe… Honestly, I think it was like Godzilla like six years ago.

Dan Kline  

So Maxx not a big movie guy. Before this. I am a big movie guy. And I’m gonna go Black Widow will be my first movie back in a theater, I’ll go see it with my son in a couple of weeks, my wife has gone to see – they went to see A Quiet Place 2 – I am afraid of things. So I didn’t see that. Movie theaters aren’t coming back. For people who worry about this as an investment. This isn’t an investment. Why? Because small movies play better at home. Netflix  (NASDAQ:NFLX), is paying big money for certain movies. And those movies might play on two or three screens for Oscar eligibility. But just a lot of the movies we used to go see in theaters simply aren’t going to come out in theaters, if you’re making a you know a movie that you’re going to make for $10-$20 million. And Netflix will guarantee you a profit on it. And an audience that makes a lot more sense than these expensive slow releases. So for the most part, I think the art house is dead.

I think we’re going to have a lot more movies, but we’re probably also gonna have a lot more bad movies, a lot more very expensive prestige movies that, you know, I didn’t watch the Irishman because I can’t imagine sitting through it. But I think you are going to have some of these otters get, you know, get paid money to make things that that maybe just aren’t that good. And I’m not commenting on that specific movie, I didn’t see it. But you know, I don’t think there’s a path back for movie theaters and separating AMC  (NASDAQ:AMC), out as a meme stock, I get all the things you could do Sure, you can show UFC fights, you can rent out space to colleges, you can have stand up comedy, or you know, or live events or whatever it is, those are going to be very niche things. If I if I was investing in the movie space, I don’t think –  there is no publicly traded company. But I’d be looking at some of the eat in theaters and some of the the experiential theaters, especially if their experience is good enough that you’d go to them without a movie.

That’s an argument I make about Dave and Busters  (NASDAQ:PLAY) all the time. This should be good enough that I want to eat here, when I’m not going to play video games or there’s not a football game I want to watch and I challenge any person to say that the food there is it is not, you know, not passable, which is a problem. So, Maxx, let’s jump ahead here, healthcare alternatives. When I say that, that’s a pretty broad thing. But I think we’ve all become pretty comfortable with everything from delivered prescriptions to telemedicine to remote monitoring of some of our health, whether it be via app or via other things. Where do you think that’s going to go is an investable space?

Maxx Chatsko  

It’s interesting. It’s not a space I follow very closely. But I feel like some of that still relatively limited. You’re much more of a fan or like more optimistic on the outlook of telemedicine, I think than I am. I just feel like there’s there’s only so much you can do. You can’t like take someone’s blood pressure or anything.

Dan Kline  

So I think a hybrid telemedicine model is going to be where we’re going. But honestly, if you ask me where to invest? I’d probably tell you, Apple  (NASDAQ:AAPL), because look, there’s a lot of things we’ve talked about on shows that it’s not plausible for your Apple Watch to be a medical device. It’s absolutely plausible for there to be a blood pressure cuff or for your watch to take your blood pressure at some point. But I don’t think – look, you can’t have a pure telemedicine appointment. I could tell my doctor I weigh 170 now I’m 5’10” you know, neither of those things are true and he wouldn’t necessarily be able to verify. But I do think you’re going to see more of the model of your appointment with the doctor is after you’ve had blood work run at a at a neighborhood lab. That’s how it works for our doctors here. You don’t get your blood drawn at your physical. You get your blood drawn a few days before or a few days after, you know, they take your height and weight, but it’s not the doctor who takes your height and weight, it’s a nurse.

So I think you are going to see more like dispatched nurses that come and you know, for now maybe take your blood pressure and things like that. But going forward, when everyone who owns an Apple Watch can can track their blood pressure for six months, that’s going to be a much more meaningful device than Dan going to the doctor having white coat syndrome and having his blood pressure be high, and then having to go you know, sit in the CVS afterwards to calm themselves down. And, and and show readings that it isn’t. You know, and doctors are aware of that. And there’s things they can check for and techniques they can use. But there’s, there’s a lot. So yeah, I am confident in that space. I am not necessarily confident that any of the pure medical companies in that space are necessarily going to make it worth that. We’re going to take a couple of comments here. We will take the second comment from Kevin Ekmark, if you want to share that one. “Wasn’t a big believer in telehealth until I bought my first Apple watch two weeks ago”. Maxx, you don’t wear any sort of fitness device, do you?

Maxx Chatsko  

Nope, no fitness devices for me.

Dan Kline  

So I do. I’m older than you. I use my fitness device as an accountability device. And my goal is to move enough every day to close up the rings. I haven’t done any of that today. But I but I will this afternoon, you know, take a two or three mile walk and a pretty aggressive pace. And I will show my trainer when I meet with my trainer two or three times a week. Yep, here’s what I did it. The only days I don’t do that is the days I see my trainer because I will say the one thing Apple is really bad at is keeping track of actual weightlifting exercise. So I do an hour of lifting weights and a pretty high cardio pace with my trainer. And it might credit me 180 calories. And I’m dripping sweat because the air conditioning is right now broken at half of our gym. So on those days, I know I put a hard hour in I’m not worried necessarily about it.

But I use this to know and i’ll go Okay, I’m gonna be in the car all day today, is there a time I can fit in a walk in the morning or, you know, am I going to have to double down and hit the gym The next day, instead of just doing something cardiovascular, I think it’s an amazing thing for that. I think there can also be some paralysis by analysis, in that I know my blood pressure at all times. And until I realized that like eating causes, you’re not your blood pressure, your heart, your heartbeat, that eating just causes you to go up 10-20 points, I had to look that up to know that that was normal, you know, to see these things. Or if you see something shocking or surprising, or sometimes just turn too fast, you might go from 65 beats a minute to 95 beats a minute, until I got used to that rhythm. I maybe spent a little bit more time worried about it than I should have. So, Maxx, go ahead.

Maxx Chatsko  

Yeah, that’s, that’s interesting. Um, first, you said, you know, it’s like more of an accountability device. And that’s actually really interesting insight. And there actually are studies that you know, people who track their weight, or their workouts or their run or whatever it may be have a spreadsheet, maybe have an app, they are more consistent, so that can form healthier habits over time. So just that it’s kind of more of like a tangent. But that’s a pretty big opportunity, I would think. And that would be good.

Dan Kline  

So I think there’s something I’ve learned from let’s call it productivity training. A friend of mine, Mike Shaw just put out a book called Not Today – it’s a productivity book. It’s also about the very tragic passing of his son and how sort of being in the hospital forced him to sort of figure out how to be as productive as possible because he had to keep his business afloat, because he needed health insurance because his son was going through some some terrible things. Search that book out, I’ll share the link on on Amazon, very proud to be a small part of it, and to have been part of their story. But when I worked on some of the editing of that book, I went, wait, I do these things at work. I have, these are my tasks for the day, I’m going to do the one I least want to do first. These are the deadlines I have. These are the things that if I clear them off my plate, I don’t have to work Friday afternoon. Like that’s how I always worked.

It wasn’t how I approached fitness, I always approached fitness as sort of this is what you’re supposed to do. And it’s really easy to make excuses to not do them. So now I sort of act like my watch is my boss and my you know, and if I don’t take that off Now look, are there days where you’re just not going to do it? Sure. The day I drove 12 hours to to North Carolina, I couldn’t do it. You know, I but most of the time, I’d say six days out of seven, seven days out of seven. I’m accountable and it makes you think about every choice you make. I was talking to my trainer, because I am going on this cruise and this works for investing too by the way, like having a diligent like Yep, every two weeks I’m putting money in. I’m going to buy you know my highest conviction or I’m going to take a 7investing recommended – whatever it is – having a method to your madness makes sense.

And then you can make exception. So with investing, I might make an exception if a stock I really love gets cut in half for some dumb reason and I still really believe in the stock. I might take some money out of my account and speed up my investments. The same happens with exercise like, you know, I might say, Okay, I know tomorrow is gonna be bad – the third Friday of every month, we are on camera from like 10 in the morning until like six o’clock at night. And at six o’clock at night, all I want to do is like eat comfort food, I don’t want to go work. So I make sure that that Saturday’s a trainer day for me that that Thursday before was a heavy workout for me. I think that there’s a lot of things you can do there. And yeah, I think tools like this help. You know, I don’t use my Apple Watch for anything else. I don’t I don’t play music. I use it to pay at a couple of places you can pull up a barcode. I want to take one last comment from Mike Fee. Maxx, if you could read this one. This is a little bit much for me to read.

Maxx Chatsko  

You’re giving me a whole paragraph here. What is this? “In a contrary sort of way higher inflation was seen as a tailwind for the travel industry. However, the 10 year Treasury is currently at 1.47% down from a high of over 1.7%. Three months ago, the reopening trade might still be alive and well. We will have a strong 2021. But profitability expectations might be muted. What do you think?

Dan Kline  

I don’t worry about inflation at all at the moment, because I don’t think we know what inflation is. The fact that I used to be able to fly from here to Baltimore for 140 bucks round trip. And now it’s 220 isn’t inflation. It’s not having enough pilots and not enough people working and not sure what the demand is and when to rollback out. The fact that certain items cost more isn’t inflation. And there might be some actual inflation. But right now, we’re living in a demand based economy. And basically within a few months, we all went from Hey, I’m at home and I’m ordering food to Oh my God, I want to go out to eat, I want to go to the movies, I want to go do this and get me to the theme park, get me to the waterpark. The waterpark near our place in Davenport was never busy during the week, even during the height of tourist season, it’s a smaller Park, there’s certainly better water parks in the area. And now it’s busy every day because I’m guessing even locals are just hungry to do things and they can’t get reservations at Disney and other places.

So I, I essentially say throw out 2021. And this is going to be the year that you really have to evaluate companies on a long term basis. Now that’s what we do anyway. We don’t go Oh, hey, the price of gas might be high. So you know, that’s going to cause fewer people to go to restaurants. So we’re not going to invest in restaurants like we look at the much longer trends, but the news media and again, I am a 20-29 year professional journalist – you know, so I’ve been doing this in some fashion since I was 18-19 years old. Professional Journalists, for the most part don’t know how to cover the market. They don’t know how to cover earnings reports they don’t know what to look for. So you’re going to get a lot of people who are just talking about comps and same store sales, when maybe those same store sales were through the roof this quarter this year, because all of a sudden everybody needed new tennis rackets or new whatever to go out and play. You really have to look at profitability next year and customer counts and average revenue per user and things that aren’t in the press release on the first page.

So as investors think long term we appreciate so many of you playing along we we know that it was a bit of a Helter Skelter show there was not a ton of news worth talking about today. On Friday, we are going to do five steps to financial freedom in honor of the Fourth of July, Anirban Mahanti from Australia will be of course be wearing his American flag outfits. And Sam Bailey, there will be fireworks. I’m not sure how we’re going to pull that off. But start talking to Simon Erickson about budgets -with that it is time to hit our finisher: Which form of entertainment will have the strongest post pandemic comeback? About 30% said concerts. Most of you agree with me on movies and said nope. 14.1% said theme parks. 49.9% said sporting events. Maxx, I’m confident in three of these. I think the demand for concerts is going to be incredible. I think the number of A-list artists that will be out over the next two years is going to be intense and there simply aren’t enough venues like you’re going to have multiple stadium artists touring in the same year.

Sporting events I think were struggling a little before this. And I think aside, it’s very market based – I don’t think all of a sudden the Miami Marlins are going to be selling out, whereas like of course the Pittsburgh Steelers will sell out but the Pirates – what do the pirates sell 200 tickets a game? I’m kidding a little bit but like it’s like the Marlins,   they’re not good. They don’t have an active fan base. But I think the one where people are missing here is theme parks. I think families were stuck home for a very long time.

There were a lot of canceled planned vacations where people already have money in. I think one of the you’re seeing this in the cruise industry that a lot of the cruise lines allowed you to take 125% credit doesn’t work out to that because prices are generally higher heading into next year. But they’re taking that credit. Well, a lot of people had cancelled airline tickets and canceled Disney vacations. In my case, I don’t know, like 30 canceled business trips. And all that money is sitting in my various accounts, my Southwest account, you know, and I think that is going to be a major boon for theme parks. And I also think this is lining up really nicely with a lot of new things opening, you know, it’s the 50th anniversary at Disney, you’re going to see new rides open at every Park, you still have a very new Star Wars land, both here in Florida and in California. So I actually think that’s the sneaky one here. Maxx, I know this isn’t your area. But any thoughts you want to weigh in on?

Maxx Chatsko  

Yeah, so I voted for sporting events, I agree with you. It’s gonna be region based, or maybe even, like, based on the sport leagues, you know, but like this fall and winter for the NFL, I think it’s gonna be really, really something pretty incredible. What else are you going to do in the winter in the fall like right now you have options in the summer right, they would dwindle away a little bit. And as an aside the joke here in Pittsburgh, you know, in the very beginning, when the Pirates were opening up the stadium again, for the first time, they came out and said, Hey, we’re gonna have 25% capacity to start opening the stadium. And everyone said, Oh, okay, so they’re a full capacity. Because they don’t sell – you’re right they might only have 200 tickets a game. And then so after sporting events, I said, concerts, I think that’s gonna be big, and I’m younger.

Dan Kline  

Here’s the I’m a big concert guy. I’ve sought out live music wherever possible during the pandemic. And I am very eager that one of the first things canceled in March I had Gaslight Anthem tickets, a show that I was actually going to DC to see it at a very famous venue that I’d never been in. A lot of the bands I’m big fans of are smaller, they don’t necessarily work full time. It’s going to be really exciting to see them hit the road for me. So I’m going to a live Kwazii sporting event in a couple weeks, my son wanted to go see the AEW wrestling show. And I am a wrestling fan. I was at the first AEW show with our with our friend Nick Sciple. And it’s in Miami. It’s in a 4500 seat venue. And they’re coming up against the problem of that when they put tickets on sale. This is their first on the road show. When they put tickets on sale, it was set up for 50% capacity. It’s now full capacity. But people sort of don’t realize tickets are still on sale.

So I think you’re gonna see a lot of kinkiness a lot of like the rules change as we go along. In some of these places. I was shocked that there were ever rules in Florida but I’m guessing that was maybe a city of Miami thing and not a not a state of Florida. But as much as a 47 year old man, it’s not that often I’m going to go out to see pro wrestling. I’m kind of excited for things I wouldn’t be excited for. Like, I want to see people sing along to entrance music and chant and, and just be normal. Like I 100% guarantee you that next year when I fly to New York to see a Rangers game that I will cry. That is 100% possibility. My college roommates had season tickets since college, I’ve sat with the same people I’m very, very eager to get to see that. But I do think it’s going to be a whole new world.

But I do wonder if the live sporting experience is something that some of us are over. I know that in the year my brother was in Miami with the Dolphins when I basically had to go to every game of a team I didn’t care about because he had four tickets and no friends who didn’t work for the team because he was new to the city. But I didn’t have to go but the first few games I absolutely did. The experience of parking and getting to my car and getting home I mean I’ll tell you, I’m not going to Monday Night Football ever again if you were playing. Like they could give me a prize and I wouldn’t be going because I got home at like 3:30 in the morning but with that being said we are very excited for the new world. I will shoot some footage while I am away in the Bahamas this weekend and we will certainly be doing some live shows for some very strange locations . Not strange but very different locations in the in the coming six months, Maxx and I will be six days all over the world in February and we’ll be at various islands which which basically means we’ll be doing shows from from coffee shops or Margaritaville’s but that being said, because there isn’t Wi Fi in like picturesque waterfalls and other places we can be with that. If you’d like to get in touch with us. That is info@investing.com. That’s for questions about your membership questions about pricing questions about how it works. Don’t ask us to work up an individual stock but if there’s a stock we’ve talked about or you are a member and you have a question, feel free, and if you’d like to interact with us on social media, we are @7investing. It’s a holiday week. We appreciate you watching. For Maxx Chatsko, for Sam Bailey. I am Dan Kline. We will see you Wednesday.