Tax the Billionaires | Animal Spirits 446

Watch on YouTube ↗  |  January 07, 2026 at 14:00  |  1:16:14  |  The Compound News
Speakers
Michael Batnick — Managing Partner, Ritholtz Wealth Management
Ben Carlson — Director of Institutional Asset Management, Ritholtz Wealth Management

Summary

In this episode, Michael Batnick and Ben Carlson discuss their 2026 market predictions, including no recession, rangebound rates, a frozen housing market, and continued strength in the Magnificent Seven and AI. They debate whether structurally higher profit margins justify elevated U.S. equity valuations and review international stocks' 2025 outperformance. Later, they analyze Disney's long-term underperformance, the potential for self-driving cars, California's billionaire tax proposal, and streaming viewership trends. The episode ends with personal anecdotes and movie recommendations.

  • Ben and Michael make 2026 predictions: no recession, rates rangebound, housing frozen, Mag 7 and AI remain supported.
  • Michael sees another up year for the S&P 500 and argues higher margins justify higher valuations.
  • International stocks and European banks outperformed, but the discussion is mostly retrospective.
  • Disney is discussed as a structurally underperforming stock despite its iconic brand.
  • Ben is bullish on Waymo and self-driving cars after using them in Phoenix.
  • California's billionaire tax proposal is criticized as ineffective and likely to drive wealthy residents away.
  • Streaming data shows Netflix dominance and Disney's flat share of TV viewing.
  • The hosts close with personal stories and movie recommendations.
Ideas
Ben Carlson Director of Institutional Asset Management, Ritholtz Wealth Management 6:49
AI bubble will not pop.
Ben predicts the AI bubble does not pop in 2026, implying continued support for AI-related equities as part of a no-change baseline.
AIQ MED
Ben Carlson Director of Institutional Asset Management, Ritholtz Wealth Management 6:52
Mag 7 will do good, not great.
Ben's 2026 prediction is that the Magnificent Seven will do 'good, not great' as part of a continuation of current market conditions, with no major regime change.
MAGS MED
Michael Batnick Managing Partner, Ritholtz Wealth Management 20:21
Expects another up year for stocks.
Michael argues valuations should be higher because profit margins are structurally elevated and rising, driven by the Mag 7's expanded moats and efficiency gains from AI and robotics. He points to profit margins up from 7% in 2005 to an estimated ~16% in 2027, record revenue per worker, and the fact that valuation bears have been wrong for 15 years, supporting a long-term bullish case for U.S. equities despite high multiples.
SPY HIGH
Michael Batnick Managing Partner, Ritholtz Wealth Management 48:35
Disney stock is structurally unattractive.
Disney's EPS has been flat for a decade, and the stock has underperformed the S&P 500 on every time frame over the last 30 years. The parks business is phenomenally profitable but doesn't scale, while Disney+ has been an anchor rather than a growth driver. Despite the iconic brand, the market doesn't reward the company, making the stock unattractive to own.
DIS HIGH
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This The Compound News video, published January 07, 2026, features Ben Carlson, Michael Batnick discussing AIQ, MAGS, SPY, DIS. 4 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Ben Carlson, Michael Batnick  · Tickers: AIQ, MAGS, SPY, DIS