Video · 2026-08-14 · 1h 4m · 6 moments

It's a bull market and nobody drinks anymore. | TCAF 255

✦ AI generated

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Mechanism◆

The record pace of ETF launches is driven by collapsed launch costs, making it trivial to create funds and abandon failures without consequence.

Todd explains that 2026 is on pace to surpass last year's ~1,100 new ETF launches because launch and maintenance costs have dropped dramatically, creating a low-barrier environment where failed funds are simply moved on from.

transcript

Todd: I don't know that this is temporary cuz it the cost of launching is is much lower, right? Yeah. Oh, yeah. It's like a It's like and the cost of maintaining a fund that doesn't catch on. ETFs have turned into Napster or just like, 'Hey, come to my shed where I have a recording studio and we'll lay down the tracks and do it for you, everything else for you.' ... I was involved in two ETF launches this year in in the same week. In the same week? Yes. I didn't promote either one of them. You don't have to promote. I don't need to promote them. You can do whatever you want.

gives example · 1

Claim◆

Exploding professional sports franchise valuations are a direct reflection of stock market wealth, not traditional business fundamentals.

Todd argues that the run-up in sports team prices — the Lakers at $12.5B, potential $20B for the Cowboys and Yankees — is fueled by the top 1% of the 1% getting enormously rich from stock market gains and tech equity, not by traditional wealth.

transcript

Todd: You know what this is? It's the stock market. ... Where do you think Josh Kushner's wealth is coming from? It's AI. It's open AI, right? He has a $15 billion position on Open AI. Now, I know I know that's not his money, but whatever. Like all of this all of this upward trajectory, it's the top 1% of the 1% getting soing rich. ... I agree with that 100%. It's this is not people that make made their money in shipping like the Steinbrers. This is straight up like shareholders in the 100 largest companies in the world.

provides context · 1

Example

New low-cost ETF entrants like Corgi are disrupting established issuers by copying popular themes at half the price, using a high-volume Hollywood box office strategy.

Todd describes Corgi, a Y Combinator-backed startup, launching 30+ thematic ETFs at roughly half the fees of incumbents. Their strategy is to release many products cheaply and let the少数 winners cover the costs of the many flops.

transcript

Todd: They are a Y Combinator-backed company. ... the folks there are basically saying we still think fees in certain segments are too high, levered ETFs and thematic ETFs. So they are going to launch everything under the sun and they're just going to try and scale it up. So they're they did 30 different thematic ETFs ... they're copying the most popular funds but for a lower price, for half the cost about 35 basis points. ... it's kind of the Hollywood box office approach. I release 10 films in a year. Seven are flops, three are hits. And the hits will pay for the flops.

Claim

Prediction markets exhibit a structural long-shot bias that makes heavy favorites slightly underpriced, creating an exploitable edge for an ETF that exclusively bets on favorites.

Todd proposes an ETF thesis based on academic research showing that heavy favorites (e.g., -850 or shorter odds) are slightly undervalued because bettors overpay for long shots. A systematic basket of only heavy favorites across sports and events could generate structural alpha.

transcript

Todd: There's something called the long shot bias, which means that people are more structurally people are more likely to bet at a long shot that will not win. So, the long shots are over are overpriced, but the heavy favorites are slightly underpriced. ... If there is a market, a basket, an index, an ETF that only buys the heavy favorites and set the line where it's an 85% chance to win. ... that is a structural impairment product. ... It's already been filed.

provides context · 1

Mechanism

Goldman Sachs' acquisition of Innovator and NEOS targets aging demographics' demand for yield and downside protection, creating sticky AUM that is resistant to competitive displacement.

Todd explains that Goldman acquired buffer ETF firm Innovator and income ETF firm NEOS for roughly $4B combined. These products cater to aging Americans wanting yield and downside protection, producing sticky assets that won't rotate out like hot thematic money.

transcript

Todd: So, Innovator and Neos were both bought by Goldman. ... they are catering to the what I believe is the aging demographics of America. You get they want yield, buffer or downside protection. ... These products have legs and and it's sticky. The AUM is sticky. Nobody's selling these products. It's not hot theme money.

Prediction

$3 trillion in retail money market funds is stuck and will not rotate into equities despite a bull market, requiring either sub-3% Fed funds rates or a massive stock market correction to move.

Todd argues that the $3 trillion sitting in retail money market funds — double the pre-pandemic level — is effectively trapped. It won't chase the bull market, and the only catalysts to release it would be Fed funds dropping below 3% or a 30%+ market crash that paradoxically drives money INTO stocks.

transcript

Todd: I said early on when interest rates went all the way up and all the money went into cash that this money was stuck. Not literally stuck, but it was going to stay put. that it was not going to come out in the event of of of a stock market boom. ... it this is $3 trillion in total retail money market funds. And for retail for context, it was $1.5 trillion the day before the pandemic started ... I do think that this generation of investors will not run out of the stock market.

Highlight slides

ETF Launch Boom: The Cost Collapse✦ from: The record pace of ETF launches is driven by collapsed launch costs, making it trivial to create funds and abandon failures without consequence.Why Costs Don't Matter Anymore✦ from: The record pace of ETF launches is driven by collapsed launch costs, making it trivial to create funds and abandon failures without consequence.Todd's Personal Example✦ from: The record pace of ETF launches is driven by collapsed launch costs, making it trivial to create funds and abandon failures without consequence.Sports Franchise Valuations Driven by Stock Market Wealth✦ from: Exploding professional sports franchise valuations are a direct reflection of stock market wealth, not traditional business fundamentals.Wealth Source: Tech Equity, Not Shipping✦ from: Exploding professional sports franchise valuations are a direct reflection of stock market wealth, not traditional business fundamentals.

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The record pace of ETF launches is driven by collapsed launch costs, making it trivial to create funds and abandon failures without consequence.

Exploding professional sports franchise valuations are a direct reflection of stock market wealth, not traditional business fundamentals.

New low-cost ETF entrants like Corgi are disrupting established issuers by copying popular themes at half the price, using a high-volume Hollywood box office strategy.

Prediction markets exhibit a structural long-shot bias that makes heavy favorites slightly underpriced, creating an exploitable edge for an ETF that exclusively bets on favorites.

Goldman Sachs' acquisition of Innovator and NEOS targets aging demographics' demand for yield and downside protection, creating sticky AUM that is resistant to competitive displacement.

$3 trillion in retail money market funds is stuck and will not rotate into equities despite a bull market, requiring either sub-3% Fed funds rates or a massive stock market correction to move.

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