Ep. 1400: Steve Burns Interview with Michael Covel on Trend Following Radio

My guest today is Steve Burns. He is the founder of New Trader U in 2011. He started investing in 1993, and trading his own accounts in 1995. It was love at first trade. A natural teacher with a gift for cutting through the bull and making complex ideas simple. He offers an extensive blog resource with thousands of original articles, as well as online courses and best-selling books covering a variety of topics. The topics are AI and trading. In this episode of Trend Following Radio we discuss: AI as a business and productivity multiplier AI tools for writing, research, coding, and content creation Trend following and reactive price action trading Brand building through consistency and social media Market psychology, parabolic moves, and risk management Jump in! --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel https://twitter.com/covel Facebook: @trendfollowing https://www.facebook.com/trendfollowing/ LinkedIn: @covel https://linkedin.com/in/covel/ Instagram: @mikecovel https://www.instagram.com/mikecovel/ Hope you enjoy my never-ending podcast conversation!

• 0:00Speaker 00

  One of my favorite ongoing guests, Steve Burns, author, trader, and social media expert. Steve and I cover wide territory today, a lot of focus on AI and trading. And I hope you find this conversation consistent with all of my conversations with Steve. It's always fun and I plan to keep these up every damn year. Without any further delay, please enjoy this conversation with Steve Burns.

• 0:48Speaker 00

  Before we get into the markets, and I guess we probably talked about this last time, but my understanding and my use of it has gone up dramatically because as a content person, podcasts, audio, video, and I'm not even using it in the audio and video yet, but I plan on it because it's just free leverage. It's crazy not to. Where do you see right now? It's a two-fold question, I'll bounce you around, but where do you see AI in terms of you, Steve? Because a lot of people are listening and they look out there, maybe they see your world, they see my world. See, these guys seem to have figured out how to manage this world of being a brand or an authority or a voice.

• 1:31Speaker 00

  And people want to learn, they want to know steps. And of course, you and I are only going to tell so much of how the soufflés are made. But how do you see AI as a tool today? Like, you know, when you wake up in the morning and you say to yourself, you know, you really think about what is this going to be for you on the rest of your life? How do you see it?

• 1:49Speaker 01

  And I feel like it's a real equalizer. We've seen the platforms like YouTube and Twitter and even Facebook equalize what the means of productions where the platform's now available to everybody, not just radio stations or televisions. I feel like AI now, you can create a business or trade or invest or whatever you want to do now. And you have access to the most powerful tools that, what was it, 15, 20 years ago? Only accessible to Jim Simmons and some of the top quant funds and some of the top companies, tech companies. We all have that now for pennies on the dollar that we can use every tool, technical tool that they had that we couldn't get to because it's too expensive and cost prohibitive just 10 or 20 years ago. I mean, I feel like you could be a millionaire now thinking building a one man business with just using AI tools for what used to cost pennies and if you find the right path.

• 2:34Speaker 00

  I mean, I'll verify that status long before AI. It's been possible for a very long time, but I think your point is the speed on which one can get there has changed. And my question wasn't necessarily only to the trading applications and you're kind of hinting at the ability to code and strategize and whatnot is completely off the hook. I don't know how the third party trading apps are going to navigate this, the trade stations of the world, et cetera. I mean, right now they've got kind of a closed environment. It's well tested. It's robust. Some of the AI stuff can have errors, so to speak, and working with data is an entirely different ballgame. But clearly, if you want to go in there and code up your ideas and stuff, you can get from point A

• 3:19Speaker 00

  to point B in what, five seconds?

• 3:21Speaker 01

  The speed, the velocity of movement. You used to have to go grind away and figure things out and go do research and dig through Google and go through YouTube and study and learn, go to college. And I feel like all that stuff's been sped up now. You can do anything. If you can have a good idea, the speed of what you can do going through AI now is mind boggling. Like you have an access to the ultimate database and mentor and you can go down a pathway. You can ask AI to give you the prompt. You don't even have to do the prompt. You can say, hey, AI, I want to do this. Give me a prompt that will allow me to do this. And it can have a better prompt than you would even have. So the exponential nature of speed is what I think, like you said, like if you want to write a book, it could take you a year to write a really big, great book with

• 4:03Speaker 01

  the AI research tools and writing tools and double checking tools and all the tools you can use in AI. You can write a book in a month. It used to take a year. So I don't want to say the speed of that is one twelfth. I mean, all the work you used to do can now be done for you.

• 4:15Speaker 00

  You know, you brought up college, just in general, and I keep seeing. Reports of professors figuring out how much cheating is going on and it's all AI. And so I'm sitting here and I'm thinking about this dog and pony pretend show that we've created, where kids all know how to use AI off the charts, but we're forcing them to sit into a classroom and fill in tests that they're all cheating on because their brain has already moved ahead. Look, I'm not excusing their cheating, but I'm saying if you ask them to do, quote, "these old school things" where they have these new school tools,

• 4:57Speaker 00

  they've already moved ahead. They're saying, "Hold on, why do I need to memorize XYZ when I've got it in my pocket?" So that's one issue. The second issue is kind of like, what the hell is college for? With AI, what the hell is college for? I really don't know. Even you and I, if we have something that goes wrong physically, and I've got some Achilles tendonitis, and it's like, I'm going to a doctor, but before that, I had figured it out before I met the doctor.

• 5:24Speaker 01

  I had the same experience. I had a severe case of GERD, and I went to the emergency room and I went to doctors, and they couldn't figure out what to do. They gave me all the wrong things to do even, which was astounding to me, and I had no choice. I had to figure this out because the doctors were useless. They just gave me medication that, you know, worked on and off. I went through a process of chat GPT and just went down to all my symptoms and grinded, said, "Act like a medical dictionary," and I just kept grinding away at it. And then it gave me the solution to my problem. I thought, "This is crazy." And that was well over a year ago. They cared something the doctors could care. What the hell are the doctors for? That's crazy. I didn't even believe it myself. I had no choice, though.

• 5:58Speaker 00

  And back to our one-man setup, so to speak. How can educated people, when they fully realize what these tools are, not want anything except being a, quote, "one-man shop"? Who really wants to work for the man? Especially in this day and age where AI is making it such that if you even start to just do a small bit imagination, your, quote, "job" could be gone soon enough. It's just amazing opportunity, and I don't know what the hell school's for now, other than people looking to put on their resume, which is another anachronism. Which I can't understand. I put on my LinkedIn profile that I went to such and such university. Who gives a shit?

• 6:36Speaker 01

  I'm always of the value of college was the networking. If you want to be an employee and get your foot in some big corporate door. I think the only values you went to Ivy League and then your fraternity brother's father is a partner at a kind of, I know people like that. You know, they know somebody that knows somebody. It's like you're a made man. You know, you have connections and then you use those connections, not the diploma. If you get the colleges, the degrees, you have no connections. They're useless. You're one of a thousand applications to the last silly white collar jobs that are left. That aren't specialized enough. And I think it's the connections and that's I think I felt that way for the last 30 something years. Now it's even more pronounced. When they're fighting for jobs that AI is already doing, it's almost like a scam.

• 7:16Speaker 00

  Yeah, look, I'm not being cocky about it. It's just that when one fully sees what, and I'm not even saying I've fully seen it yet. I've seen a lot of it, but when one grasps what's going on with these AI tools, Claude, Gemini, Grok, whatever. You can't go backwards. That game is over. It's not there anymore. That's the part that strikes me. It's just not there anymore. Like you said, the people are fixated on these networks and stuff. We all want to make friends. We all want to have a network, so to speak, but you know, it's an amazingly confusing time for a lot of people, but I'm so damn excited. I gotta make sure I figure out ways to make me fall asleep.

• 7:56Speaker 01

  Yeah. So like my wife is with AI with her fable adventure in Claude. She's a vibe coding. She's loving.

• 8:03Speaker 00

  She would hold on. She was one of the first ones. I had to go back and listen to that episode because I was probably a touch naive. That was over two years ago, I think. She was one of the first ones that came on this podcast to actually talk about AI.

• 8:14Speaker 01

  Yeah. She's the first one I ever heard about it. She was deep into all of these tools, like early 2022. She was deep in the road and all the tools of AI. And what the hell was even going on? And she was already deep into it. I think what's astounding to me is like we've talked about is how do you hear all these pundits like these jobs? We gotta have universal basic income and people saying, you know, and even both sides of the political spectrum demanding like, what are we gonna do about jobs? We can't let AI replace jobs. And like, I do not understand that because historically forming what the term. The century nineteen hundred, what was it, over ninety percent of people worked on farms or had farms and ninety percent of farming went to machinery and equipment? Is that and nobody ever says we're going to divide what you'd have corporations making hundreds of beans or trillions. We're going to divide that up and everybody doing their own thing. And they now have the capability through AI or technology and platforms to do their own thing.

• 8:58Speaker 01

  But nobody ever says that you define your own thing to do. Even if it's blue collar service work, a lawn care service, whatever little service, that's where the real blue collar billionaires, you know, using AI to help them build a blue collar business even or whatever books, music, videos. You can make a movie and you can do write songs. It's just the an online platform is all monetized now. It's like, what in the world are people doing looking for jobs? It's almost like I hope twenty years from now, we look back and go grandchildren and great grandchildren go. You people used to show up somewhere and work for somebody else and now they understand what we're talking about. We get weekly paid for doing what by hour? Doesn't make any sense. AI can do all that. Why would we be doing that? Go move on. Let's just all, you know, make YouTube videos for each other or have podcasts with each other.

• 9:42Speaker 01

  Move on from all this silly job stuff and find something more fun to do for money.

• 9:46Speaker 00

  I could play devil's advocate to the response of being like, hey, you, Steve and you, Mike. You like this entrepreneurial risk taking life where, you know, you're willing to do things that other people don't want to do. And most people just want some security and they want to just go to a job and not think about all this other stuff. Hey man, that world's gone. That world's gone. It's not there anymore. Sorry. Don't give me that stupid argument anymore.

• 10:16Speaker 01

  The one good news for them is you're probably about thirty three percent to fifty percent of people probably have to be told what to do and have to have jobs in our employee mindset and a fixed mindset. They probably have that. The good news is if all these other people leave the workforce to do their own AI thing, their own business, their own platform and their own brand, if they leave it, that'll bring up wages because there'll be less and less people willing to do the work. So that could be positive economically for the employees that still want to do that. So it could be a supply and demand curve and help them if they stay, everybody else leaves.

• 10:46Speaker 00

  You make a great point though, too, that you said earlier before everyone thinks. We're sitting here only talking about the digital world. If you're a really good plumber, if you're really good at fixing household appliances, if you're a good carpenter, the opportunities are endless. You make a great point. It's not just if they want to compete with a bunch of tech nerds like me and you. The opportunities are endless and the AI can help those businesses too. 100%.

• 11:12Speaker 01

  Something is astounding is I see so many blue collar millionaires making a great living off of doing like their carpenters or HVAC or plumbers doing YouTube channels. And getting millions and millions of hits doing things that like not even doing their millionaires in their business and then they pivot to YouTube. Just like because people go to search YouTube to find out how to do things. So that's a whole nother cash flow stream, even if you're doing that. So you can still coat tell off the platform and you can use AI to help you write your research and write your scripts and what you want to do. The research and the data now is amazing.

• 11:43Speaker 00

  Just some quick specifics here. So for me, I don't really play around with chat GPT. I think I just dislike the owner so much, but I do find myself using Claude and Gemini and Grok. And they're all very different.

• 11:57Speaker 01

  He's at least four or five every day for all those different specific purposes that I found they all excel at. So that's very specific.

• 12:04Speaker 00

  Without giving away your trade secrets, lay out a normal use case for assorted AIs for you.

• 12:11Speaker 01

  If I want to write a book and I want to do chapter ideas, chat GPT for whatever reason has the best chapter ideas. If I give it a book idea, I give it the basis of what it's going to be about and say, give me some chapter ideas. It gives me the best and I'll do it on all the platforms and chat GPT just kills it. And they're great. They're clever. They're it fits together well, but the other ones are gobbledygook and you know, AI slump. But then I go to like Claude, you know, this is what the chapter is going to be about. Give me an outline for this chapter. And Claude does a great job of writing, like the outline and the specifics and the writing style. But I have to use chat GPT's ideas to get the quality of writing. The fact check and research, Google Gemini seems to be the most accurate for fact checks and quickest to do it.

• 12:52Speaker 01

  Because Google Gemini is trained on Google. There's another thing I would say is like, if you want to research X, Twitter, Grok is the best one. Research X and Twitter is with Claude because it's trained on Twitter's information platform. If you wanted to research things online or Google, I don't know, Google YouTube or Google Keyword or some, Google Gemini is the best because Google's trained on Google's data. The training they did on each one of these platforms, I think, really influences which one they do best at. Of course, ChatGPT is the best for images now. It's crazy now. I can just put a copy and paste article that I wrote years ago into ChatGPT and say, give me a better cheat sheet or a better image. ChatGPT makes amazing images. But Claude can't make images. So if I write something with Claude, I can use ChatGPT to create the image to use

• 13:36Speaker 01

  as a comparison of people. I mean, I don't think a graphic artist would take hours to build the things that ChatGPT can build instantly. And I'm going back and fixing my old stuff. Now I'll put it back in ChatGPT and update it and make it so much better than it ever was before. It's better than a graphic artist. Like, that's nuts.

• 13:51Speaker 00

  Hold on, you're looking pretty young right now. Are you telling me you're AI now too? I don't know who I'm gonna be talking to in the future, right? Is anyone gonna know who's who? Even though I don't have a fondness for all, then I guess I'll have to look into ChatGPT after you've explained your use cases. I have found, is it kind of a small, minor hack on AI writing? Or we should call it more AI copy editing or advanced thesaurus work. I find, unlogged in Gemini, giving it a paragraph or a sentence and asking for a slight copy edit or to change this word or change that word. I find Gemini gives me the best writing. Claude gives me crap, ultimately. Claude can't do that.

• 14:32Speaker 01

  Sonnet is a better writer. The Opus is not terrible writer. Claude Opus is terrible. Claude Sonnet can write. Yeah, it's useless to have Claude Opus. So much editing, it's not even worth the using.

• 14:44Speaker 00

  The tools are just amazing. I think also in terms of the coding for trading ideas. It doesn't make a difference what your platform is. This gets to a bigger issue too, where I think AI is going to marginalize what I'm about to say, which is so many people are caught up with. Look, I remember back in the day bumping into trend followers early on. They're coding in Lotus 123 and Fortran and Excel.

• 15:10Speaker 00

  It doesn't matter anymore. It just doesn't matter. Yeah, okay, yeah, you gotta have your data straight. Everything's gotta be copacetic, whatever. But ultimately, these debates about the source of code and the platform and all this stuff, it's just gonna be inconsequential.

• 15:25Speaker 01

  Technology edge is just gone. Remember, what, Etsy Code had an edge? Wasn't Etsy gonna even punch cards to back test like exponential moving average crossover trend following systems in what, the late 60s or 70s? The edge he had, nobody else had the data he had on just simple moving average crossover systems, and he was killing it. He was just completely reacting to the market, but nobody else even knowing what his signals were back then. And now, it's nothing.

• 15:48Speaker 00

  You bring up an interesting point, too, just to take it into the market space. I look around these days, and the parabolic moves, or the collapses, and I just jotted some of these things down, from Oracle to the Korean stock market, the yen, Bitcoin, SpaceX, the movement.

• 16:06Speaker 01

  Silver.

• 16:06Speaker 00

  Silver. The movements we're seeing, this is not a Homer take for trend following. There's other strategies that could take advantage of these parabolic type moves. But these parabolic type moves, this was the 70s and the 80s, these kinds of moves, or at least for the time being, while there's no more zero interest rate policy, all bets are off, but it sure looks like that it's organized, parabolic runs and pump and dumps being created globally, everywhere. You know, you don't have to like pump and dumps. You don't have to like my phrasing of it, and I think everyone knows what I mean. But look, if we're facing a situation

• 16:45Speaker 00

  where there's gonna continually be parabolic moves, collapses, in futures, commodities, crypto, there's no other way to trade this stuff, except from a trading strategy.

• 16:57Speaker 01

  Jack Swager's newest Market Wizard book, The Next Generation, all the young traders, and most of them on Twitter, like, that was a lot of their strategies, were like what you were saying, for the last several years, that's what they did to make the money. They had huge wins and huge losses through the parabolic moves, because either they made an absolute fortune, or they got crushed, even with very moderate position sizing, these moves are so big. So that's very interesting that he had that in his book, like what You're saying exactly what almost every market wizard, the newest generation talked about with the parabolic moves. And then, you know, both the profit and loss in it.

• 17:27Speaker 00

  I don't know the exact numbers off the top of my head. Maybe the high was around 300 and it's around 120 now. I think that's right. But I mean, Oracle is supposedly one of these tech bellwethers, been around forever. Everybody at the corporate levels has to use it. They're all embedded. There are service contracts and all this other kind of stuff. And I look at the chart and I look at the market cap going up and there's nothing about it to me that says, oh, this is normal. Oh, this is legit. So I say to myself, if this is the new normal and if something appears to be not legit, who knows? What's your strategy for trading that? That's what I would say to the individual out there.

• 18:08Speaker 00

  If you're looking at these assortment of markets that I'm rattling off, Korean, Oracle, yen, BTC, SpaceX, whatever. If you're looking at these moves, how the hell do you think you can trade these things? Without an entry strategy, without an exit strategy, without some form of risk management. I don't know how a remotely thinking person with an IQ above room temperature can trade these without a strategy.

• 18:34Speaker 01

  Now the bondholders selling off the Oracle private debt and they're worried about the debt levels Oracle has. Fundamentals are no help because it ran up when those debt levels were absurd. It ran all the way up on those crazy debt levels and it crashed because of the debt levels. So like you said, you could only do a price action trading system. There's no other way you could have traded at with price action.

• 18:53Speaker 00

  Let's keep it at that point for a second, you making the point that the fundamentals were the same, essentially. And so that gets back to my point, which is what the hell's going on? And I think people have to realize that just like with crypto, there are pockets of capital sitting around with a lot more than you have. And those pockets of capital, not unlike OPEC, are probably an oligopoly. It's probably coordinated. Look, if you happen to be buddies with six or seven other guys and you control 50% of some market and you've got a collegial relationship, they probably will work together. But guess what? You don't know who those people. You don't know what their decision making is. You don't know what Bilderberg room they're meeting in.

• 19:37Speaker 00

  What can you do if you're not part of the squad or the team? And I think you and I have taught a lot of people about this. If you're not part of the team, you've still got great opportunities.

• 19:48Speaker 01

  You don't have to predict the well or know the well. You just have to ride the well. Wherever the well's swimming, that's where you have to go. And generally, its price action shows you. Like you said, it's so wild and volatile, but you can still safely trade it with a good price action trading system that goes in the path of least resistance. That still works over time. Like you said, you will be on the side of parabolic runups, or you'll be short or out on the side of parabolic moves down. There's a only solution still after all these years. Like what Nicholas Darviss even talked about in the 60s. Same exact thing you're talking about. Nicholas Darviss didn't know who the hell was taking over a company, or who was loading up, or insider buying, any of that. He just knew it was going up, so he was long until it quit going up.

• 20:25Speaker 00

  I put my first website up 30 years ago.

• 20:27Speaker 01

  That's incredible.

• 20:28Speaker 00

  And what's changed? What's changed? What has changed about the markets and strategy in that time period? You tell me. It's still the same.

• 20:37Speaker 01

  Jesse Livermore quote where he said, only the pockets change, the names change, the human behavior stays the same. The same human behavior causes the same action.

• 20:44Speaker 00

  When you say price action, to even kind of dig into that term, you're really just saying people. Because who's the price action? The price action is the people. So you're really just saying, I'm saying the same thing, which is, hey, man, I want to trade the direction of the crowd. I want to be with the crowd, and I want to trade the direction of the crowd. And I don't necessarily know when the crowd's going to start running on any one market. How can I do this?

• 21:12Speaker 01

  It goes back to one of the best articles, my favorite article of your site, I think of all time, was when you had a reactive technical analysis versus predictive technical analysis. I think that was one of the most master classes. I think, I don't know anyone else has ever coined that, but you. You have a signal, whether breakout or momentum, to get you in. Then you have a trailing stop. So if it reverses, you have a way to get out without having a huge loss. And you let your trailing stop make your decisions on how far it goes. That's reactive technical analysis. Everyone else, what percentage of people are still lost in predictive technical analysis? Ninety something percent still want to predict what's gonna happen, wants to overthink everything and ponder everything and listen to people's opinions that are absolutely meaningless. No one has any idea what all the millions and millions of people are gonna do Monday morning. Nobody has any idea or Sunday night in the future.

• 21:57Speaker 01

  Nobody has any idea what they're gonna do. Anything could even change by then. It's just like the ultimate fallacy is the prediction.

• 22:02Speaker 00

  Predictive technical analysis, which is in many ways is just more fundamentals. It's just, I've got an opinion about something might happen. Whereas what you're talking about, what I'm talking about is kind of like, I don't really know what's gonna happen. No one knows what's gonna happen. So if that's the case, what can we do if no one knows what's gonna happen? Except, it sure looks like these parabolic moves come and go quite often. I mean, look, I look at the Korean stock market right now. This chart is absolutely insane. Apparently it's two markets, right? I'm sure some people, when it's all said and done, will escape with a bloody fortune. And you know what? Maybe these dramatic all-time moves in these Samsung and the chipmaker are gonna go on forever.

• 22:45Speaker 00

  And Korea's gonna be the next bigger than Japan. Who knows what? But what kind of plan is that, man? What happens if it crashes? I think people just don't ask that question enough, which is amazing to me.

• 22:57Speaker 01

  I think the biggest benefit of this, like you talked about with zero interest rate world, is fiat currency flooding into all the world's financial markets is probably what's driving all this crazy bubble trends and parabolic moves. To think, what is it now with the US where the US is now paying, what, a trillion in short, in interest rates to bondholders, what, every sixty to ninety days? So they're creating a trillion more in debt within three months to give US bondholders another trillion in cash. Like, where does all this cash go? The money markets are at all-time highs. The stock market was near all-time highs. The debt's at all-time highs, fiat currency. What happens if they, like you said, they actually raise the interest rates? They do a Volcker-style, have to get inflation under control. And then nobody's following the trend. Everybody just long all this stuff.

• 23:41Speaker 01

  It's like the 2008 nightmare begins.

• 23:43Speaker 00

  There's an interesting psychological thing going on here, which is, obviously, don't fight the tape. Okay, I get it. Feel bad for the mass of the population where when you go to McDonald's and two people getting their so-called adult Happy Meal. And it's costing them 30 or 40 bucks for two people. And then they have to look at their retirement account and say, no matter what, we are going to stay in every AI stock. So it's kind of like people are being bribed in a way, or not bribed, they're kind of being forced into staying with whatever the system tells them to do. Just to go to McDonald's.

• 24:21Speaker 01

  The cost of living is astounding to me is nobody at the economic illiteracy now where people don't even understand what causes inflation. And they want to blame people or blame the rich or blame capitalists or being capitalism and have no understanding of the current monetary policy and the Federal Reserve system and the federal government debt issuance. And what they've done with the, was it Trump, the PPP loan and the COVID bailout, well, that's six trillion, seven trillion. And then the inflation reduction is six trillion of more debt printed and have any idea you put that much currency in a system chasing fewer goods and stocks and real estate. That causes inflation, just supply and demand on currency and nobody knows that or understands that they blame other places and things.

• 25:04Speaker 00

  We've got a situation, I don't know if there will ever be a reset or trying to find some sense of fairness again. But the numbers of Americans, for example, that are on some form of here is your check, do nothing. Then the numbers of Americans on that kind of assistance, which means you and I are paying for it, is probably at least half the population.

• 25:32Speaker 01

  And some form, some level.

• 25:34Speaker 00

  If that ever snaps, it just seems like America's situation is quite precarious. Somebody could say, well, Mike, you're kind of talking at a both sides of your mouth. You're kind of making a prediction for economic end times. Look, I can walk and chew gum at the same time. I can look around at the system and say, hey, this looks like shit. But if I'm going to trade shit, then Trinfalling is the best way to trade it. Or some price action type strategy is the best way to trade the unpredictable, unknown. Unexpected shit.

• 26:01Speaker 01

  Well, there's nothing else to do. You can't have predictions. The opinions are meaningless. You have to follow the trends, whatever the trends are in anything. I thought it's fascinating. The more I dig into Charlie Munger and Warren Buffett is if you really look at Warren Buffett's entire career, he was a trend follower of fundamentals. That's all. He was a pred- looked at probabilities math and he trend followed fundamentals. In real time, and he would change his opinion if the fundamentals changed. I thought that was astounding to me. After all these years, I started thinking, a clique for me, because I never really thought of it that way. I always thought it was just fundamentalist and investor.

• 26:31Speaker 00

  You're spot on about that. And I would have to say that as a young guy, first understanding Buffett, I probably just thought, yeah, he's just a fundamental guy. No, there was a lot of math there, a lot of math. And look, there's first mover advantage. He's the first guy. He gets the biggest cash pile. That creates a lot of interesting opportunities for him. But still, there's lessons to be had there with those two men for sure, right? You and I can go find right now, Munger speeches that are just, you put them on, you start listening and it's like, okay, again, why are you going to college? Munger's for free.

• 27:02Speaker 01

  Yep, and better.

• 27:03Speaker 00

  I'm curious how you might advise people, and maybe this is going to be a lot of AI. But you are a brand, I'm a brand, and then you have a company brand, I have a company brand too. Then there are book brands, so to speak. In many ways, we're running similar, but not similar, but similar, parallel lives, so to speak. Speak to me about brand building. If I had to observe you, I would say your brand building was doing something that I definitely was not doing early on, like you were doing it. But you seem to be very well aware of getting a head start in social media consistency. I think that's what you do is consistency.

• 27:44Speaker 00

  If I had to define it, I'd be like, Steve is like a social media, ongoing, trading aphorism. I don't know how you feel about that, but speak to me about your strategy over these many years. Whether it's evolved or whatnot, or you found your way into something you didn't expect. Speak to this idea of building a brand as you have done, because we were talking early on in this conversation about the one man shop and all that kind of stuff. Speak to the Inspiration you can give people about brand building as a one man shop?

• 28:14Speaker 01

  Think it's a natural, it's a lot of the doers say this, you know, natural flow of who you are. Whoever you are, that is your one hedge because nobody else can be you. So whoever you are, you start out, whatever you're deeply passionate about, interested in, like my Twitter feed was like a stream of consciousness. You know, for years and years and years where I just shared what I found interesting, I thought other people would find interesting. I knew the opportunity of building an audience so early was like, I think I started 2010. I thought it was like this opportunity to build an audience for free was astounding to me because that's what celebrities and other people have done the last 70 years. Like you can now do this and you can beat somebody and I enjoyed the like a game to me. So I started like just flow conscious sharing because I really, I was started the top book reviewer on Amazon.

• 28:57Speaker 01

  I got to like 150th top book reviewer of all books on Amazon for helpfulness. And then I'm writing the reviews helped me conceptualize all the books I read and it was all hundreds and hundreds and hundreds and hundreds of trading books, probably several hundred trading books, several hundred investing books, financials. I did the book reviews to really solidify my thoughts and that's where everything else came from. I met you through that. I met Swager, Alexander Elder, a bunch of other trading authors that I admired through that. You were one of my first inspirations because whatever you were sharing on Facebook back then, I don't know, 2009, 2010. And you were sharing that, that's interesting and I enjoyed what you shared on Facebook. So then I thought I'm going to do that. I started sharing on Facebook and on Twitter. And I sort of saw what you were doing. I thought that's really interesting. I like that. Now I'll enjoy doing it because I enjoy the interactions and learning from other people.

• 29:42Speaker 01

  The very beginning, I was still in the learning stages, uh, what 15, was it 16, 17 years ago, I was still learning and studying. So really it started 20 years ago on, it was starting on Amazon. So I was just using it really to learn as much as I was sharing what I learned and what I knew. And then I started amplifying what people enjoyed, the topics they enjoyed. I started optimizing for what people wanted to hear. So people would be interested in what I had to say. So I would see what people, the topics and things that were interesting. Like I found that moving averages and trend following is fascinating people. So I wrote a book about moving averages because of the interest in using moving averages and trend trading. So I wrote a book about it because I saw the interest and I enjoyed it and that was my first really successful. Book after a new trader is trader. So sort of like me sharing who I am, what I'm interested

• 30:25Speaker 01

  in, what I've learned and what I think I can share with other people to learn. And then people, like you said, the consistency, people know what to expect with me. They know I'm going to tweet something. They know what my topics are going to be about. They know what I branch into with financial independence and success, consistency and knowing what they're going to get and you care what your audience. That's so many people make the mistake, especially in writing books. They write a book that nobody gives a shit about. Nobody's going to read. Nobody cares about. I write books about what I see people are interested in, want to read. I'm not doing it into a, what do you call it? Echo chamber. I'm giving my audience what they have shown me they want. And I expand on that in all the other areas of my business. If I just do whatever I want to do, it'd be, it'd be nothing. Nobody care.

• 31:01Speaker 00

  It's an interesting point. We actually probably had slightly different ways to get to the same place. Because I guess for me, it was like, when I got into these topics, say trend following and the turtle story, it was, me personally, these things are fascinating. They seem to be buried. There doesn't seem to be a lot of people that know about it. I guess because it was like really at the infancy of the internet, I didn't have the data to say, well, these people are interested. I just kind of had to make the jump, the leap of faith that like, oh, I'm interested in this. So I will then put it out there. And I think this also is a negative in a way because starting with that mind frame, it then becomes like, this is what I'm thinking. This is what interests me.

• 31:43Speaker 00

  And even though I got started on some social media early, I never stayed as consistent with it as you did. And I branched more towards the books and the podcast. In hindsight, that's definitely an error because the consistency of social media, even if sometimes it could be considered boring, the consistency of social media is goal.

• 32:05Speaker 01

  It's like you built your own little platform and audience. The opportunities would always stagger me for free from the very beginning. Like it costs nothing. It used to cost to have a broadcasting license or a radio station or TV was the means of productions was you could never get. Now we have it.

• 32:19Speaker 00

  I think it's going to get more interesting in the future. And I keep telling this to friends and family and stuff. I'm like, brand is all there is. Whether it's going to be your personal brand and/or a corporate brand that you create, brand is it.

• 32:33Speaker 00

  Because right now, if people go online or go into AI or whatever, and they start poking around in the trading world, it's only a couple of degrees of separation from their initial searches, finding something from my world or your world. That's tough to compete with if you're new, because you've got to jump ahead. But it's also an opportunity, because then you say to yourself, wow, I can build a brand outside of these other people's brands. I can't copy their brand. It's kind of silly to try to copy Charlie Munger or Warren Buffett's brand, even though Munger's no longer with us. His brand will go on forever. Is Charlie Munger ever going to die? Is he ever going to die? Huh?

• 33:14Speaker 01

  Our books will live on probably 100 years after we're gone. That's what I thought, too.

• 33:17Speaker 00

  Yeah, Munger's never going to die. Look, a lot of people might not know he's even dead. He is dead, right?

• 33:23Speaker 01

  99, almost 100.

• 33:24Speaker 00

  I think we talked about this before. I've told family and friends, like, look, if I go in an accident, don't tell anybody, because there's no way to know. You disappeared tomorrow and went into the jungle of South America, and a bunch of cannibals ate you. I hope like hell your wife would keep you going. She's probably got enough content. Seriously, do you agree that there's probably enough Steve content that your wife could keep you going if somehow or another the cannibals in Uruguay, or Paraguay, or Peru, or Bolivia ate you? Do you think she could keep you going?

• 33:55Speaker 01

  Absolutely. She could probably publish new books, like, off of my content. I think she's created a platform, ChatGPT, and she fed all the books that I've written into, and it knows who I am. Like, there's an AI me that, yeah, like you said, she could keep going and just use my content in new ways, and even tell the AI to create, connect new dots, and make new books in my name, posthumously, if she wanted to. So I think you're right. We might be AI algorithms ourself after we pass.

• 34:21Speaker 00

  Seriously, you know, one thing I've not done yet, I've got a couple folders that I've put aside, that I've had assistants work on over the years. And these folders are filled with nested folders upon folders of research content, PDF content, white papers, all in the trading world. I know stuff that is just back a little bit younger and a little more manic, where I was just saving everything. You know, I kept thinking to myself, let me get this information organized. I'll be able to use it in some way at some time. I didn't know how. I wasn't thinking ahead, just saying to myself, well, I'm going to have 500 folders, multiple folders deep, white papers going back 100 pages, whatever, all this stuff. And essentially, I was building a second brain before it was really in vogue. And I've not yet deployed it.

• 35:06Speaker 00

  I'm really curious to see some of this earlier work that I've done. What will happen when I deploy it as the second brain, so to speak?

• 35:14Speaker 01

  Take that and drop it in the most powerful tool that is deployed, Fable, and drop it in there and say, hey, Fable, what's enough content in this to write five different books? Give me the five book titles I could write from this content and white papers and see what it said would be fascinating.

• 35:28Speaker 00

  I'll tell you one that's really fascinating. The Turtle Trader book I put out was, by and large, the complete story. Even though I hate that word, "complete," that was put on the book by the publisher, not me. I never would have used a word like that. But I have a folder of turtle content that no one has. It's filled with interviews that have never been made public. It's filled with audio, some video, every article that you could ever possibly imagine that surely be impossible to find today. It would not change the story that I wrote in my book, but the level of depth is off the hook.

• 36:08Speaker 00

  The story, I think, would be even crazier when you get into the level of detail. Some of the backgrounds, I mean, for example, all the resumes of all the positions that all the turtles had before they ever started, in their own handwriting, where they were working at, like what bar they were working at, what restaurant they were working at. You know, these kinds of crazy things, I'm gonna have to figure out a way to deploy it.

• 36:33Speaker 01

  Complete Turtle will be as big as the newest black-covered trend following book.

• 36:37Speaker 00

  I'm working at number six of that, by the way, so sixth edition. The publisher initially said something about, well, stream it down to something. I said, the current book is 220,000 words. If you don't want to read it, you can kill your dog with it, you can kill yourself with it, you can use it as a weapon, whatever. I can't give an audience, whose the last edition was 220,000 words, I can't give them a book that's smaller. It doesn't work that way.

• 37:02Speaker 01

  That is the trading bible. That's as close to the trading bibles as anyone will ever have.

• 37:05Speaker 00

  A last kind of topic area I want to go with you. How do you stay motivated?

• 37:09Speaker 01

  My wife's love of spending money keeps me motivated to keep grinding even harder.

• 37:14Speaker 00

  It's funny, she works too.

• 37:16Speaker 01

  Yeah, oh yeah, she's right there. I wish I could think of more things for her to do. If she has all the capabilities and she's like, she'll buy a coke perhaps for hobby.

• 37:23Speaker 00

  There's some kind of internal drive. Nobody can do this kind of small shop, brand building stuff, brand expansion, creating content. No one can do this as long as you've done it or as I've done it, unless you just really enjoy spreading a message. So, I know you enjoy spreading a message.

• 37:41Speaker 01

  Yeah, serious answer. It's like a game to me. I guess my autistic spectrum level I'm at is like, that's my game. That's my game. I mean, and I'll watch like sports documentaries and I love the path of people playing sports. And I watch occasionally the best movies, but I don't really do a lot of fiction. I don't do TV. I do reading mainly. So like, this is my game. Other people might get up and watch the ball game and go to the beach and do whatever humans do and mess around, but like, this is my game. That's what I do. Like other people play video games for four or five hours. I'll go do social media for a couple of hours. I'll go look at on the week and look at all this data. I'll look at data and quantitative analysis on the weekend as like what I'm doing for fun. But seriously, this is my game and what I've always enjoyed. Like you said, no one could ever do what I've done because you'd have to enjoy the journey, what you're doing.

• 38:26Speaker 01

  And if people would not find enjoyable, thinking of like all the tweets every single day and doing that. So, I think that just I enjoy the process of what I do. Like a video game to me.

• 38:36Speaker 00

  Yeah, I'll share with you one last point about AI. I'll take me back to my chat GPT criticism, just so it doesn't sound like I'm completely just being out there. But I'm working on a autofiction novel. I didn't even know this term when I got started. But essentially, it's a fictionalized autobiography, which I'm sure actually some people will be curious about. How does the quote, "all American guy" end up somewhere in Southeast Asia? And what happens when he ends up there? And what does he learn when he's there? And what does he learn about history when he's there? And so anyways, I started to learn some things about a president that was before my time. Lyndon Johnson. And I started to realize, wow, this guy had a mouth on him that was like no other. He said things that were just off the hook.

• 39:19Speaker 00

  Grok had given me a lot of stuff that he had said. Some of it might have been not 100% verified, but most of it was. So I went to some of the other AIs just to verify. And I said something kind of innocuous to ChatGPT. I said, hey, can you tell me like the top 25 most lewd things Lyndon Johnson said? And it said, I cannot do that, I'm sorry. I said, excuse me, these are known facts from a president of the United States. What do you mean you can't give that to me? And so in one of the appendices of this novel that I'm working on, I include this entire conversation with ChatGPT, where it explains to me, chapter and verse, why it can't tell me facts that are known facts. That's not something that would probably come up for most people.

• 40:04Speaker 00

  But I think it is worth noting that some of these AIs, you've got to have your wits about you because if you do find yourself into any controversial topics, these AIs are definitely programmed by their owners to have points of view. Now, I think for things like price-based trading systems, I don't think there's any bias there. Some of these other issues, you're going to find bias.

• 40:26Speaker 01

  It's like garbage in, garbage out. So that's the thing I've seen in modern times, is false information and no critical thinking skills. Where somebody says something is fact. All right, well, this is all fact. I won't even go on any of those topics. Somebody will say something and then that's a fact and nobody looks into it. Nobody questions the incentives of who's saying it. Nobody questions the political incentives and they just accept this fact. And then you have half of the American people believe in one thing and 100% know it's true and the other half believe another thing and know it to be true. And the AI models are just trained on the majority of what the online people say. So if there's 20 media sites saying the wrong thing, even Grok will have the wrong thing. So that's one thing. You've still got, critical thinking skills are still critical. And like you said, a lot of times I'll double, triple check AI against itself, against each other before I believe it.

• 41:09Speaker 01

  Like if I don't think it's quite right, I'll check it against the other one, the other polar political AI.

• 41:14Speaker 00

  But then again, you and I are of a generation where, okay, Gen X, a little more skeptical. We've got half of our life outside of the internet, half of our life inside the internet. And, you know, young people, they don't have that. They don't have that perspective. How are they gonna know? Like, look, I've had many long conversations with Claude about controversial topics. And Claude will read something that I've written, will immediately be like, oh, that's wrong, this, that, blah, blah, blah. And then painstakingly go through and show the proof. And eventually it comes around to being like, oh, yeah, I was programmed to say that. And it's actually incorrect. Young people are not gonna know to press that button about, hey, hold on, AI, you're actually lying to me.

• 41:59Speaker 01

  I've seen that too, where I, like, I go down some deep rabbit hole, whether it be politics, religion, academics, some controversial stuff, the Federal Reserve even. You have to go, like you said, you have to prompt this, and what about this? Where do you come from? What year? Who owns it? What's actually going on? How many academics say this? Or, okay, give me a counter theory. What would be a counter theory to what all these people believe? Like factually, or even which one? It's anything is Grok, where I'll say, only use critical thinking skills and the facts and information, not people's opinions. I tell it to remove people's opinions and focus on the actual factual data. And it'll give you a completely different response. I've done that, but it blew my mind across many different topic areas. I thought, wow, that's different.

• 42:39Speaker 00

  Without that kind of prompting, I have seen Grok give some extremely woke responses, which then crack me up. Cause then I look at Elon's posting on X, and it's like, there's nothing woke there. But it's like, these models, I think the training was done in such a way to where it's very hard to. In fact, I asked Claude this question about like getting some of the, quote, the woke bias that's inherent in these models out. And Claude told me that it thought it could be five to 10 years before it's worked out.

• 43:11Speaker 01

  Cause it's this training on bad information. And once there's corrupted information of a source, even like academics, like through all of human history, most scientists have been wrong about things. So AI models would have been trained on what the scientists believed at that time, and AI model The Civil War wouldn't have known what germ theory even was. It no, people don't, germs don't exist. People don't die of germs because they wouldn't have known any better.

• 43:31Speaker 00

  We'll end it on that, though, in the sense that what's great about it is, okay, we could put the controversial social topics over here. But when it comes to trading, there is no tool. It is a once in a lifetime, change the world tool. And as long as we keep having parabolic moves, the things that we talked about price action today, it's an exciting time to be alive, to say the least.

• 43:54Speaker 01

  You've got to spend so many thousands of hours of your life doing what we did manually, you're going to be doing through AI, but trading.

• 44:00Speaker 00

  Steve, where can we send people? Where would you like them to go? They could find you on X, easy, Steve Burns. I'm going to guess, and you can tell me if I'm wrong, even if I just go do a simple Google search, if I type in Steve Burns, am I finding you, essentially?

• 44:13Speaker 01

  I think I'm starting to take over the Blues Clues actor Steve Burns, who also had an album. So it's me and him are the only two well-known Steve Burnses in the world.

• 44:20Speaker 00

  I'll be sure your content dwarfs his. So maybe there's some random Steve Burns who's doing something over here, you know, singing country music. But then Steve Burns, the trading guy, is probably everywhere else and dominating the screen.

• 44:32Speaker 01

  Yes, I finally climbed up to all those Google rankings over the years, and my picture now shows up and not his.

• 44:37Speaker 00

  You're welcome to tell people where to go, or we could just leave it as if you can't find Steve Burns, doesn't want to know you. I'm not being cocky, I'm just saying, it's like a litmus test, it's the filter. If you are listening and you can't find Steve Burns, you don't deserve to know Steve Burns.

• 44:52Speaker 01

  That's hilarious. Yeah, just make sure I have a blue check mark on X, because there's a lot of imposters. The S. Joseph Burns Twitter X with the blue check mark, not the imposters. You know you're big when you have thousands of imposters.

• 45:04Speaker 00

  I don't know if I've really got any, I think, because partly it's my last name is funky, so it's like, it really wouldn't make much sense to try and copy that last name.

• 45:12Speaker 01

  Didn't one of my imposters follow you on Blue Sky?

• 45:14Speaker 00

  I think I was on that momentarily. I don't know if I'm still have an account there. It's not on my phone, and I must have deleted it. I could still have an account there.

• 45:21Speaker 01

  I was never on that. My imposters were over there, pretending to be me. I wasn't even on the platform. So that was, I think they contacted you, I think, if I remember right.

• 45:29Speaker 00

  I did momentarily go on Threads, but I don't know, maybe I've got an assistant that posts some content there, I'm not sure. I've actually got a channel, like your channel in a way, more of these aphorism type stuff. My assistant's been running that one. I kind of turned her loose and let her go play. It's like an experiment, but. Steve, listen, we got to catch up every year. Appreciate it, man.

• 45:47Speaker 01

  Always enjoy it.

• 45:53Speaker 02

  I see a time when those awake will understand how to make money in up, down, and surprise markets. Whether new trader or experienced, college student or financial advisor, protecting against a crash or just trying to make a lot of money, trend following offers everyone an answer in uncertain times. To get started immediately, send me an email, [email protected]. I will send you the right trend following steps to take along with my free video. But if you want to buy and hold, trust the government and trust Law Street, this is absolutely not for you.