He Used His House as Collateral to Bet on a Company That Builds Houses.

In his most recent interview with The Economist, Elon Musk said that because of AI "money will be irrelevant by the year 2036."

I can see that happening too.

AI is already displacing millions of jobs.

One report says 40% of all jobs could be automated within the next decade.

When that happens, the government will have no choice but to pay people some sort of Universal Basic Income.

But this could take 20 years to materialize

So while Musk tweets and Congress holds hearings, what are you supposed to do? Wait?

I don't think so.

But you don't have to. Universal Income already exists.

It's not funded by robots or AI. It's funded by America's oil and gas infrastructure, and it pays 10% a year, 42 times a year, to everyone who holds units.

It's called the Patriot Income Plan, or P.I.P. for short.

And this year it's expected to pay a record $53 billion in distributions.

Think of it as your own personal sovereign wealth fund, backed by the biggest energy producer on planet earth.

Enroll in P.I.P. before the next payout

P.S. Since 2020, the average partnership in P.I.P. has produced 20% avg. annual gains. That's in addition to the 10% yield. One investor already collects $4,800 a month. Another hasn't worked in years. Show me something better. I'll wait. [Enroll in P.I.P. →]

LOSS OF THE DAY 🏆

Every day we crown one person who made the worst financial decision on the internet.

Today's winner made a bet so perfectly ironic it belongs in a museum.

Here's the setup. A guy on r/investing found KB Home, the homebuilder, trading at $76 and change.

His thesis was four words long. Housing always comes back.

He took out a home equity line of credit - $254,000 at 8.5% APR - and used the equity in his house to bet on a company that builds houses.

He bought 3,337 shares of KBH at an average price of $76.12.

Then the earnings started coming in. Q1: EPS down 65%. Revenue dropped 23%. He held.

Q2: EPS down 71%. Revenue down 27%. Missed consensus. He held again.

The stock ground from $76 to $52.52. Slowly. Over eight months.

For context: he's also paying 8.5% interest on the HELOC. That's another $21,590 a year on top of the $78,741 in unrealized losses.

Total damage: $100,331 and counting. The stock reports Q3 earnings today after the close. Analysts expect another 45% decline in EPS.

Brother. Housing doesn't always come back. Sometimes it just keeps filing earnings reports, and the earnings reports keep getting worse.

Not everybody can be Loss of the Day. But these two gave it a real shot.

Let's run through the tape.

There are certain phrases in DeFi that sound smart until you understand what they actually mean. "Impermanent loss" is one of them.

Here's the thing. It's not impermanent. Not when the token drops 78%.

u/yield_hacker_88 deposited $94,400 into a liquidity pool. The pair was ETH and a protocol token called $PRISM.

The pitch was 340% APY. The pool had $2.1 million in total liquidity. It looked legitimate.

One problem: $PRISM's team announced a protocol pivot. They were abandoning the original roadmap. The token dropped 78% in six days.

The APY was still showing 340% on the dashboard when his position was worth half of what he put in.

Translation: the interest rate on a burning building is technically still positive.

u/value_deep_42 believed in General Mills. Not as a company that makes Cheerios. As a trade.

His thesis: consumer staples hold up in downturns. People always buy cereal.

He bought 80 GIS $42 call contracts expiring in October. Total premium: $28,640.

One problem: people do buy cereal. But Wall Street was looking at the margins. Organic sales down 3%. Adjusted EPS down 37% year over year.

GIS has been sliding for nine months. The calls needed a reversal in six weeks. It did not reverse.

The stock is at $35.90. His $42 calls are worth approximately nothing.

Nobody lost money betting on cereal before. That's what makes this one special.

Every newsletter needs a meme section. Ours just hits different when you're reading it from a HELOC payment you can't make.

If you laughed, you're coping. If you didn't laugh, you're probably providing liquidity somewhere right now.

See you tomorrow. Same losses. Different people. Exact same mistakes.