Episode summary
Paid in Eggs | Money Stuff: The Podcast
Money Stuff The Podcast
· · Hosts: Matt Levine, Katie Greifeld
Summary
The host and a guest spent much of the episode on two examples of markets being turned into odd little products: “No Elon” ETFs and egg pricing. On the ETF side, they argued that investor anger at Elon Musk and SpaceX joining major indexes has become so intense that there is now a plausible niche product in buying the NASDAQ 100 or S&P 500 without Elon-related companies. The guest framed these ETFs less as pure portfolio construction than as a consumer offering or even performance art, a way to package a view that some investors simply do not want Elon exposure.
They then dug into index rebalancing, describing it as a liquidity-provision trade that helps index funds avoid paying up all at once when they need to buy huge blocks at the close. The host and guest discussed how hedge funds can make large, cyclical profits by anticipating index demand, but also take meaningful risk if the stocks move against them. They also speculated about future supply from SpaceX lockups expiring and whether that might offset forced demand from index funds.
The second half turned to eggs, bird flu, and a settled lawsuit alleging price manipulation. The guest explained how egg producers allegedly used a clearinghouse price to influence broader wholesale pricing, and noted the settlement was paid in 50 million eggs, which will go to food banks.
Key takeaways
- The guest says “No Elon” ETFs are basically a consumer product for investors who want index exposure without SpaceX or Tesla.
- The host and guest argue that index rebalancing is really a liquidity-provision trade that helps index funds avoid a huge closing-auction price spike.
- They note that the trade can be wildly cyclical: one team reportedly made $3.7 billion in June after earlier suffering a large loss.
- The guest says the egg case centers on allegedly manipulating a benchmark clearinghouse price that fed into broader egg contracts.
- The settlement was unusual because it was paid in 50 million eggs, with 5 million earmarked for New York food banks and the rest going elsewhere.
Notable quotes
“this is the most the general public has ever cared about index methodology”
“Fund marketing not a real investment thesis”
“index funds need to buy so much stock all at once, and that's terrible”
“What I'm saying is like the thing we'll know in six months, we I guess we'll know how much money it took in, which is important”
“the settlement was paid in eggs”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. — Kitty, I met your mom yesterday. — Yeah, you did. That's so crazy. — I went to your work baby shower. — Yeah, it was supposed to be a surprise, but — Yes, you were unsurprised. — I figured it out.
You have methods of information. — I do. I love knowing things, so I try to just accumulate knowledge, so I did unfortunately spoil the surprise for myself. But they brought in my mom, which was really nice. She met Matt, which was really exciting for her. You keep like circling around me who aren't my dad. And my dad is dying to meet you.
Okay. Okay. Maybe maybe I'll meet him at your other baby shower. — Are you actually going? — No, it's too far. I have too many children. — God, that was that was a cruel — A cruelties. — Yeah, that — I know that my mom complimented your voice. Yes, she did to me. And I said to her, the reason this podcast exists is because enough people are like, you were great for a podcast.
Yeah. — I was like, well, then I better do a podcast. And now here we are years later doing a podcast. — I know. God, it's such a full circle moment. — Anyway, — I'm having a real like supply chain day like,
Oh, — Where if one — Welcome to Hot — Like if if one thing goes wrong, then everything — Oh, I see. I see. — Everything else goes wrong. Not like not like — No, I'm not like thinking deeply about — Transporting goods from through the straight straight form.
I mean, actually that I should think about a little bit.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- etf investing
- index rebalancing
- liquidity provision
- averaging into the index
- securities fraud lawsuits
Watch the episode
Watch “Paid in Eggs | Money Stuff: The Podcast” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Money Stuff The Podcast, this episode and its artwork belong to Bloomberg. Octagon is not affiliated with the show; this page is an independent summary.
