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Money Monday with Brian James · Brian Thomas

0:00
Speaker 1: Happy Monday always made extra special, extra happy and good
0:04
Speaker 1: morning to the uh covert group of ladies who wait
0:08
Speaker 1: patiently for this moment in time every Monday for Brian James,
0:10
Speaker 1: small or financial to join the program and talk about well,
0:13
Speaker 1: money Monday, Money Monday matters, and we've got some cool
0:15
Speaker 1: topic to talk about. Welcome back, Brian James.
0:17
Speaker 2: Thank you. You love our ladies' support group out there.
0:20
Speaker 2: I haven't heard from them since.
0:21
Speaker 3: I'm gonna go ahead and assume that we nailed their
0:23
Speaker 3: questions there a few weeks.
0:24
Speaker 1: Well, I like to think, I like, you can just
0:26
Speaker 1: stop it, you know, you like ladies period, don't matter
0:29
Speaker 1: whether they're a sport group listening to you, Brian James.
0:31
Speaker 1: But uh yeah, I'm pretty much full on record with
0:35
Speaker 1: the concept anyway, Brian James, Scott to ask you about
0:38
Speaker 1: that gang yesterday.
0:40
Speaker 2: I was there.
0:41
Speaker 3: I was there, you were there, Yeah, Yeah, I thought,
0:45
Speaker 3: let's give him a chance.
0:46
Speaker 2: We'll see how this codes of the offense is amazing.
0:48
Speaker 3: It's like they haven't missed a meat without burrow, which
0:50
Speaker 3: just sounds like sacrilege to say. But oh my gosh,
0:53
Speaker 3: the defend on defense on the other end of the spectrum, completely.
0:56
Speaker 1: Absolutely. It's funny you mentioned Burrow. My wife brought that
0:59
Speaker 1: up a couple of times. I wonder if Burrow's sweat
1:01
Speaker 1: and bullets about his job. So I don't think they're
1:03
Speaker 1: gonna get rid of Joe anytime soon, but glass Jaw
1:05
Speaker 1: he is, and if he gets injured one more time,
1:08
Speaker 1: I think the writing's on the wall. Of course, we've
1:10
Speaker 1: been well taken care of on an offense perspective, but wow,
1:13
Speaker 1: that defense was just a total letdown. Maybe we'll get
1:16
Speaker 1: some personnel changes coming out of that one.
1:18
Speaker 3: You know, we look at this that we spend Monday
1:20
Speaker 3: and Tuesday every week just looking for those headlines and
1:22
Speaker 3: they just never come. So apparently it is acceptable down
1:25
Speaker 3: there on the river for this kind of performance.
1:27
Speaker 1: Nice segue, because the headlines we're going to talk about
1:30
Speaker 1: starting out of the gate here on Money Matters is
1:32
Speaker 1: our money Monday issues, the latest on the shutdown and
1:34
Speaker 1: it's varying impacts on stock markets and benefits and social security.
1:38
Speaker 1: And I observe something this morning. One of the you know,
1:41
Speaker 1: the ringing of hands and the nashing of teeth brought
1:44
Speaker 1: about by the end of snap benefits, and there were
1:46
Speaker 1: two court rulings on Friday, which said the trumpetman or
1:49
Speaker 1: the Trump administration must use emergency reserve funds during the shutdown.
1:54
Speaker 1: So there's five billion dollars in funds that are sitting
1:57
Speaker 1: behind the scenes. The USDA had originally plan to use
2:00
Speaker 1: those in the event of as shutdown. The Trump administration
2:03
Speaker 1: said no, it's not allowed to use them. But now
2:05
Speaker 1: they have illegal too legal opinions saying you have to
2:09
Speaker 1: do it. And they haven't said they're going to appeal yet,
2:11
Speaker 1: and they just said something along the lines of when
2:13
Speaker 1: we need more clarity first, if we're given an appropriate
2:15
Speaker 1: legal direction by the court, it will be my honor
2:18
Speaker 1: to provide the funding. Now, I think politically speaking, and
2:21
Speaker 1: I know we normally don't dwell dwell on politics, but
2:24
Speaker 1: snap shut down bad and people are going to start
2:27
Speaker 1: looking for folks to blame. And while I do not
2:29
Speaker 1: believe the Republicans are to be blamed for this shutdown,
2:32
Speaker 1: given that they want to keep funding at the original
2:34
Speaker 1: last year Biden level funding, which includes all the programs
2:36
Speaker 1: that Democrats love. Democrats wanted to use this to increase
2:40
Speaker 1: the government spending and include a lot of folks in
2:42
Speaker 1: regard to these supplements that they've been getting to make
2:46
Speaker 1: Obamacare appear palatable. But these two rulings would allow the
2:53
Speaker 1: Trump administration to go ahead and continue to pay at
2:56
Speaker 1: least for the never next several weeks without the snap
2:59
Speaker 1: folks feeling the pinch of the shutdown that buys the time.
3:02
Speaker 2: I would think, well.
3:04
Speaker 3: You would think, but I think the fact that the
3:07
Speaker 3: federal judges came out we've now had two legal rulings
3:09
Speaker 3: saying that yes, you must use these dollars for this purpose, Well,
3:12
Speaker 3: that has nothing to do with what's gonna what.
3:13
Speaker 2: The reality is going to be that the.
3:16
Speaker 3: Trump administration generally ignores those kinds of rules anyway, and
3:19
Speaker 3: those kinds of ultimatum.
3:20
Speaker 1: So no, but it's suggested it would follow them. I mean,
3:22
Speaker 1: I'm I trust me, I understand where you're coming from
3:25
Speaker 1: from generally speaking, that's what we might expect an appeal
3:28
Speaker 1: A no, no, Moss, I'm not going to do it.
3:30
Speaker 1: But he did say I'm happy to follow the court order.
3:33
Speaker 1: Just show me the guidance. I'll be I'll do it.
3:35
Speaker 1: But like I said, I think that will be politically
3:37
Speaker 1: advantageous for Trump because the government remains shut down, but
3:41
Speaker 1: they are using the funds that are parked in the
3:43
Speaker 1: back somewhere to pay the snap folks.
3:45
Speaker 2: Yeah, that's right.
3:46
Speaker 3: And there are forty two million people out there, about
3:48
Speaker 3: one in eight people a golden snap, and they're looking
3:50
Speaker 3: at that's who is of course looking at disruptions.
3:52
Speaker 2: To their families.
3:53
Speaker 3: And when are we gonna see You know that we've
3:55
Speaker 3: already seen the headlines of the lines outside the food
3:57
Speaker 3: pantries and all that kind of thing.
3:59
Speaker 2: Right, when are those place is going to run out
4:01
Speaker 2: of food?
4:01
Speaker 3: If they're not already so there will literally be no
4:03
Speaker 3: option where How close are we to that? And you
4:06
Speaker 3: got to think that some good chunk of these forty
4:08
Speaker 3: two million people did actually vote for Trump a year ago,
4:11
Speaker 3: so I would I think it would be politically expedient
4:14
Speaker 3: for him to do so. He just seems to be
4:16
Speaker 3: waiting for more and more information or more. I'm not
4:19
Speaker 3: sure what the different outcome is going to be other
4:21
Speaker 3: than making it a much much louder when it actually does.
4:24
Speaker 1: Happen, Well, we'll wait and see. But again, I think
4:27
Speaker 1: they're trying to just just wait it out. See how
4:30
Speaker 1: many if there is pain out there, we're all going
4:32
Speaker 1: to experience? Who ultimately gets blamed for this. We go
4:34
Speaker 1: back to that ridiculous blame game when I think the
4:37
Speaker 1: answer to that question is pretty obvious anyway. What about
4:40
Speaker 1: its impact on the stock market, what about its impact
4:43
Speaker 1: on social security? I mean, because the market still seems
4:45
Speaker 1: to be plowing along doing quite nicely, hasn't really reacted
4:49
Speaker 1: to this shutdown much? Is that going to happen soon?
4:51
Speaker 3: Brian James, Well, I mean, I don't see it happening
4:53
Speaker 3: anytime soon, because the end of the day here, all
4:56
Speaker 3: we really care about in the stock market is profit
4:58
Speaker 3: margin period, end of story. That's all we've cared about that.
5:00
Speaker 3: I think that's all we will care about. So these
5:02
Speaker 3: kinds of things, and I don't mean to be little
5:04
Speaker 3: for the people who are stuck in it, but as
5:06
Speaker 3: far as the stock market goes, this is a sideshow.
5:09
Speaker 3: And at the end of the day, there's still an
5:11
Speaker 3: awful lot of catalysts and things out there that are
5:13
Speaker 3: moving the market in a positive direction. We are seeing
5:15
Speaker 3: a lot of earnings reports. We're in earning season now,
5:18
Speaker 3: so we're seeing earnings come out very positively, and there
5:21
Speaker 3: just doesn't seem to be much signed, as you said,
5:23
Speaker 3: of any real pullback.
5:25
Speaker 2: So we've talked before about.
5:27
Speaker 3: The impact of a shutdown on the overall stock market,
5:29
Speaker 3: and it generally doesn't seem to be all that impactful.
5:32
Speaker 3: We are at the point of, depending on who you
5:35
Speaker 3: talk to, this may be the longest shutdown or it
5:38
Speaker 3: will be shortly, depending on whose list of days that
5:41
Speaker 3: you're looking at. There's a bit of a question as
5:44
Speaker 3: to how long the last one was. But the thirty
5:47
Speaker 3: four days is the number I'm sticking to. We're about
5:49
Speaker 3: at that now, and there doesn't appear to be any
5:52
Speaker 3: on the horizon, any end to it. So we'll see
5:55
Speaker 3: if we can make one long enough that it actually
5:56
Speaker 3: has an impact on the stock market. But I'm not
5:58
Speaker 3: holding my breath too much. Should be too impactful for
6:01
Speaker 3: people as far as their investments go. Obviously, that's one tiny.
6:04
Speaker 1: Part of all of this stuff, right, is that to
6:06
Speaker 1: say that the folks that would be most impacted by
6:09
Speaker 1: a protracted government shutdown, let's say SNAP is impacted, or
6:13
Speaker 1: some other social welfare program might get impacted, or some
6:17
Speaker 1: other peripheral form of the twenty five percent, you know,
6:20
Speaker 1: discretionary expenditures of government. Is it that they don't impact
6:24
Speaker 1: the economy much by way of their buying decisions, or
6:27
Speaker 1: is there something that I'm missing.
6:28
Speaker 3: Well, yeah, I mean this is this is a group
6:31
Speaker 3: of people who are benefiting from the ability to get
6:36
Speaker 3: food and sustenance from the federal government, and that's not
6:40
Speaker 3: going to surface very much in our companies making money
6:44
Speaker 3: or not quite frankly, because there's not a lot of
6:46
Speaker 3: money left over in those households to do the kinds
6:48
Speaker 3: of things that drive the economy. So that's not pulling
6:51
Speaker 3: a significant amount of dollars out of the economy. That's
6:54
Speaker 3: why it's not really having an impact. If it was,
6:56
Speaker 3: the market always likes to anticipate these things, market would
6:59
Speaker 3: have come down weeks ago in anticipation of some kind
7:01
Speaker 3: of massive change in consumer spending.
7:03
Speaker 1: Yeah, and that's exactly what I would have expected. Doesn't
7:04
Speaker 1: take a real rocket science to come to that conclusion.
7:07
Speaker 1: But I guess prior shutdowns have had a comparable lack
7:10
Speaker 1: of market impacts. So you saw that kind of as
7:12
Speaker 1: a prior guide, right.
7:13
Speaker 3: And frankly, I think that's what this administration is relying on.
7:16
Speaker 3: That these things that that we have that have been
7:19
Speaker 3: kind of laid into bedrock by the Democrats are not
7:22
Speaker 3: as impactful to the overall health of the country versus
7:26
Speaker 3: obviously they're extremely impactful to the groups of people that
7:28
Speaker 3: they benefit. But in terms of the overall health and
7:31
Speaker 3: success of the company of the country, I think the
7:32
Speaker 3: Republican side just says, look, this isn't going to hurt
7:35
Speaker 3: the country in the long run. Let's go ahead and
7:37
Speaker 3: fight it and see if we can't change things around
7:40
Speaker 3: kind of more fundamentally than we have.
7:41
Speaker 2: In the past.
7:42
Speaker 1: All right now, insofar as so security is concerned, without
7:44
Speaker 1: diving into the loophole, we're going to talk about to
7:46
Speaker 1: next talk about next. I know it's been an odd
7:49
Speaker 1: revelation for a lot of folks that the government shutdowns
7:52
Speaker 1: means that there are certain areas of government that aren't
7:55
Speaker 1: there to do the work they do. For example, numbers crunchers.
7:58
Speaker 1: You know, we can't do this without out the CBO
8:01
Speaker 1: doing their job, or we can't do this because such
8:04
Speaker 1: and so bureau behind the scenes is not doing its
8:06
Speaker 1: number crunching job.
8:08
Speaker 2: Anything.
8:08
Speaker 1: In so far as social security is concerned, I have
8:10
Speaker 1: many listeners out there who are receiving Social Security or
8:13
Speaker 1: anticipating receiving it soon. Is that is the government showed
8:16
Speaker 1: shutdown impacting them. I know, we just recently got the
8:19
Speaker 1: cost of living adjustment. That was everybody who's waiting for.
8:22
Speaker 2: Yeah, no, I am not hearing anything. Obviously.
8:24
Speaker 3: I've got a lot of clients that are utting from
8:26
Speaker 3: Social Security and we're not hearing a single word about
8:29
Speaker 3: that now. I do think that the Republicans that are
8:32
Speaker 3: pushing this, that are wanting to hold onto the shutdown, well,
8:35
Speaker 3: frankly the Democrats too. Nobody's really talking about Social Security.
8:38
Speaker 3: I think everybody knows that that is the third rail
8:40
Speaker 3: because that is the largest group of people we have
8:43
Speaker 3: in this country. They all vote and they have time
8:45
Speaker 3: to pay attention to the headlines. So if you affect
8:47
Speaker 3: those checks, that the backlash from that is going to
8:51
Speaker 3: be swift and fierce. So I have not heard anything
8:53
Speaker 3: about changes coming to Social Security program impacted by the
8:57
Speaker 3: shutdown itself, other than it's always a little bit tougher
9:01
Speaker 3: to get any information out of the government that wasn't
9:04
Speaker 3: quick and efficient anyway. So I don't know that that's
9:07
Speaker 3: going to have all that much of an impact on
9:09
Speaker 3: the general day to day operations.
9:10
Speaker 1: So scary, and I know a lot of the shutdown
9:13
Speaker 1: is based in premise upon the Democrats wanting to continue
9:16
Speaker 1: these extensions of the Obamacare supplements that are scheduled to
9:18
Speaker 1: end at the end of the year. So the new
9:20
Speaker 1: Obamacare premium numbers are rolling out, which if none of
9:25
Speaker 1: this shutdown happened and there was no legislative change, this
9:28
Speaker 1: would have happened as a matter of logic and reason,
9:31
Speaker 1: because they were set to shut down at the end
9:33
Speaker 1: of the year. So what we're seeing now is the
9:36
Speaker 1: reality of the cutoff date. People are angry, I suppose
9:40
Speaker 1: about not getting the supplements anymore, but I don't see
9:43
Speaker 1: that as being this like Snap benefits being cut off,
9:46
Speaker 1: having the same sort of outcome in terms of rage.
9:49
Speaker 1: Where are we on that one, Brian Well, I.
9:51
Speaker 3: Think it's going to take longer for it to sink
9:53
Speaker 3: in what that actually means to people versus, you know,
9:55
Speaker 3: the Snap benefits that means I can't get food this
9:57
Speaker 3: week from right right now. That's going to get my
9:58
Speaker 3: attention right away, versus as these premiums that I ever
10:01
Speaker 3: really understood to begin with.
10:02
Speaker 2: It's going to be a while down.
10:03
Speaker 3: The road that they actually filter through and help people
10:08
Speaker 3: and people realize exactly what that impact is of those
10:11
Speaker 3: costs going up out of pocket.
10:13
Speaker 2: But it's going to be the same reaction at the
10:14
Speaker 2: end of the day if the ends don't meet. The
10:16
Speaker 2: ends don't meet.
10:16
Speaker 3: We started it with food and we're going to move
10:18
Speaker 3: into healthcare, and eventually there's going to be a pretty
10:20
Speaker 3: loud hue and.
10:21
Speaker 2: Cry over that from somewhere hasn't happened yet. Though it
10:24
Speaker 2: hasn't happened yet.
10:25
Speaker 1: Don't put your heart, in your faith, in your future
10:27
Speaker 1: in the hands of a politician. It will never work out,
10:28
Speaker 1: regardless of who you're relying on. Eight sixty more with
10:31
Speaker 1: Brian James going to it's eight nineteen here in fifty
10:35
Speaker 1: five Karasini Talk station, Brian Thomas with money Mondays Brian
10:38
Speaker 1: James or or financial loans them out for a few
10:41
Speaker 1: segments every week at this time, and diving on and
10:43
Speaker 1: Sosa's Security. I've never heard that children could get Sosa's
10:47
Speaker 1: Security benefits. And I suppose there's a couple of hoops
10:49
Speaker 1: you have to jump through on this, but some big
10:52
Speaker 1: ones if you're sixty two years or older, I'm thinking
10:56
Speaker 1: there's not a lot of them that have minor age
10:59
Speaker 1: children or children that will be eligible for some slice
11:02
Speaker 1: of the pie again. Break this down for my listeners
11:05
Speaker 1: and me.
11:05
Speaker 3: Brian, So, yeah, so you called this a loophole a
11:08
Speaker 3: couple times this morning. I'm not sure i'd go there.
11:10
Speaker 3: Somebody heard that and said, oh cool, here's something I
11:12
Speaker 3: can go do.
11:13
Speaker 2: Okay, okay, okay, free money.
11:15
Speaker 1: Since you brought that up, you know, as a lawyer,
11:17
Speaker 1: and my first dog, I named him loophole because there's
11:20
Speaker 1: a joke that behind that. But these loopholes don't exist.
11:24
Speaker 1: If it's in there, they intended it to be there.
11:27
Speaker 1: I'm thoroughly convinced that the people who write the tax
11:29
Speaker 1: code are writing in what you and I might proceed
11:32
Speaker 1: to be loopholes for the intended benefit of some person
11:35
Speaker 1: that's well connected with the tax law writers. Just me
11:38
Speaker 1: being jaded and cinical. Brian James, Fair enough, fair, thank you.
11:41
Speaker 3: So yeah, I just did want somebody to think, oh, hey,
11:44
Speaker 3: here's a new thing, a trick I can play and
11:45
Speaker 3: get myself some free money. Does that pretty big hoop
11:48
Speaker 3: you got to jump through for this? So really, this
11:50
Speaker 3: information is for people who may already be in this
11:52
Speaker 3: situation and weren't aware of this benefit. What we're talking
11:54
Speaker 3: about is social security benefits for dependent children of people
11:58
Speaker 3: who are social security age and are actually drawing on
12:02
Speaker 3: Social Security. Now you might think, do the quick math
12:04
Speaker 3: on that, that might be you know, that's somebody who
12:06
Speaker 3: had kids in their mid to late forties, if not fifties.
12:09
Speaker 2: Yes, that's true. But we're also the.
12:11
Speaker 3: Other benefit here, or the other group of people we're
12:13
Speaker 3: talking about it is people who you know, maybe grandparents
12:15
Speaker 3: who adopted a child from their own adult children because
12:18
Speaker 3: the men.
12:18
Speaker 1: Well, okay, fair enough, fair enough on that one. I know,
12:23
Speaker 1: I personally know some quote unquote grandparents who are now
12:26
Speaker 1: raising their children's children because of well, drug issues and
12:30
Speaker 1: some of them passed away. So there's always that possibility.
12:33
Speaker 2: Absolutely, and that's why this is out there.
12:34
Speaker 3: So I wouldn't call it a loophole, just kind of
12:36
Speaker 3: a safety net for these situations to be particularly challenging.
12:39
Speaker 3: So right now, only about one percent of soci security
12:41
Speaker 3: beneficiaries or children, so that's not this is not a
12:44
Speaker 3: huge amount of people that we're seeing here. However, now,
12:47
Speaker 3: with with economic situations kind of dictating, current generations are having.
12:51
Speaker 2: Kids later and later and later.
12:52
Speaker 3: So we'll see how this pans out over the next
12:54
Speaker 3: fifteen twenty years. There may be that percentage may go up,
12:58
Speaker 3: so the checks can be good size Brian about eight
13:01
Speaker 3: hundred bucks to one thousand dollars per child per month,
13:04
Speaker 3: and which oftentimes that that the income gets used to,
13:07
Speaker 3: you know, boost college savings or offset childcare costs. That's
13:10
Speaker 3: kind of the whole point of making sure that these
13:12
Speaker 3: older families can get benefits for or can get the
13:15
Speaker 3: lifestyles they need for their children. This can start as
13:18
Speaker 3: early as age sixty two, same as Social Security. But
13:21
Speaker 3: that also because remember the whole trigger of this is
13:23
Speaker 3: that you have to file yourself right, so that means
13:26
Speaker 3: you're filing earlier to tap into these benefits that are
13:29
Speaker 3: available for you and your dependent children. That means you're
13:32
Speaker 3: not waiting till seventy anymore. You're gonna go ahead and
13:35
Speaker 3: you know, and get that going. And then if you
13:37
Speaker 3: file it's so sixty two, that's going to knock down
13:39
Speaker 3: your benefit brought probably twenty five to thirty percent less
13:41
Speaker 3: for life. Right, it's just the math behind it, that's
13:44
Speaker 3: not you know, sometimes it can make sense to do that,
13:46
Speaker 3: sometimes it doesn't. It's the whole purpose of financial planning, right.
13:49
Speaker 1: You break the numbers down and you do the math
13:51
Speaker 1: and you figure out whether it's better to take it
13:53
Speaker 1: at sixty two or to wait off because you can't.
13:55
Speaker 1: I suppose it's unlikely the older you get, moving towards
13:59
Speaker 1: seventy two. I suppose that you're going to have a
14:01
Speaker 1: minor age child. I'm living in your home, right, yes, yeah.
14:05
Speaker 2: That's the something is.
14:07
Speaker 3: Then you've got challenges anyway if that's happening, So don't
14:09
Speaker 3: rush out and have a kid.
14:12
Speaker 2: Whatever.
14:13
Speaker 1: There's a bunch of multi multi millionaire geriatrics, you know,
14:16
Speaker 1: octogenarians that are marrying twenty something, so don't say it
14:19
Speaker 1: can't happen.
14:20
Speaker 3: They good very well. And that's why this benefit exists.
14:23
Speaker 3: So if you're having trouble making ends meet, you are
14:25
Speaker 3: in this situation. And this is not new by the way,
14:27
Speaker 3: this has been around since like the thirties. But just
14:30
Speaker 3: be aware that that benefit is out there for you
14:32
Speaker 3: to help you out well.
14:33
Speaker 1: And I understand this money is tax free for the
14:35
Speaker 1: children because you know they probably aren't making enough to
14:38
Speaker 1: pay federal taxes in any way, right.
14:40
Speaker 3: Correct, Yeah, And and you can still claim them as
14:43
Speaker 3: dependents as you would have anyway, and then you can
14:45
Speaker 3: turn around if if you don't need the money to
14:47
Speaker 3: kind of fill the gaps. Then you can invest it
14:49
Speaker 3: in a five twenty nine or some kind of custodial
14:51
Speaker 3: account and use it for college benefits down the road.
14:54
Speaker 3: But you have to just make sure that that money
14:56
Speaker 3: stays in the child's name to avoid Social Security repayment
14:59
Speaker 3: issues that we're custodial is very important with that topic.
15:03
Speaker 1: A little opportunity to maybe put the money away for
15:05
Speaker 1: the kid for the future if you don't need to
15:07
Speaker 1: spend real time.
15:08
Speaker 2: Yeah, it could be.
15:09
Speaker 3: And remember there's there are new rules over the last
15:11
Speaker 3: couple of years with five twenty nine plans where they
15:13
Speaker 3: can actually you can actually turn it into wroth IRA contributions.
15:18
Speaker 2: Way down the road, there's moving parts to that.
15:20
Speaker 3: But yeah, if you put money in a five twenty nine,
15:22
Speaker 3: now this came out in twenty four, if you've got
15:24
Speaker 3: money left over, then for that same beneficiary, it can
15:27
Speaker 3: become up to currently about five years worth of roth
15:30
Speaker 3: IRA complitions. Yeah, that five twenty nine has to be
15:33
Speaker 3: in place for fifteen years though, so if it's invested
15:36
Speaker 3: and I actually I just had a conversation at the
15:38
Speaker 3: Bengals game yesterday with a friend of mine about this.
15:40
Speaker 3: Who's gonna he's in a situation where he's got money
15:42
Speaker 3: left over in his five twenty nine. Yeah, and I
15:44
Speaker 3: said just leave it alone, but make sure it's not
15:46
Speaker 3: in the graduate fund, because that's an extremely conservative fund,
15:50
Speaker 3: because the plan is assuming you need it right now
15:53
Speaker 3: for college. If it's gonna sit and grow for that
15:55
Speaker 3: roth ira game later. Get it reinvested in something that's
15:57
Speaker 3: gonna grow and has a little bit of risk attached
15:59
Speaker 3: to it.
16:00
Speaker 1: Always say I learned something every day. Sadly it's a
16:02
Speaker 1: little too late for me to take advantage of that.
16:04
Speaker 1: I love the concept of being able to convert that
16:06
Speaker 1: leftover money because we did have some money left over
16:09
Speaker 1: in the five twenty nine for my daughter's account. Brian
16:12
Speaker 1: James will continue Price of oil. Peace of God passes
16:15
Speaker 1: all human understanding. How does one calculate the price of oil?
16:18
Speaker 1: How does one understand what OPEC does and does not do.
16:21
Speaker 1: We'll continue on that topic one more with all our financials.
16:24
Speaker 1: Brian James. It's say twenty five right now, fifty nine
16:26
Speaker 1: to fifty five KERCD Talks Nation Brian James. Money Monday,
16:29
Speaker 1: doing that money Mond Day thing from all Worth Financial
16:32
Speaker 1: and over to something that's always puzzled me, and I
16:34
Speaker 1: guess obviously OPEK mean different countries coordinating together to determine
16:40
Speaker 1: how much oil is going to cost. So if that
16:42
Speaker 1: happened among a coordinated group of domestic companies, they would
16:45
Speaker 1: be sued under the Sherman Anti Trust Act. So they're
16:47
Speaker 1: constantly and have always been manipulating the price of oil.
16:50
Speaker 1: We can go back to the seventies, remember how bad
16:51
Speaker 1: things were back then when we didn't produce our own
16:53
Speaker 1: But fast forward to today, we are the largest exporter
16:56
Speaker 1: of oil on the planet. I think we're out producing
16:58
Speaker 1: everybody because of modern tech defracking, drilling, and permitting. So
17:03
Speaker 1: I don't know whether we're impacted by OPEC's decision to
17:05
Speaker 1: the extent we used to be. But they decided they're
17:09
Speaker 1: gonna quit this. I guess they boosted production one hundred
17:13
Speaker 1: and some odd thousand barrels per day up until the
17:16
Speaker 1: end of the year, but they said first quarter next year,
17:18
Speaker 1: we're gonna pair that back. What's behind all this, Brian James, Well,
17:22
Speaker 1: same thing.
17:22
Speaker 3: They're always looking at, which is supply and demand. Just
17:24
Speaker 3: like every other country, every other company out there that's
17:27
Speaker 3: trying to make a profit. They're always going to try
17:28
Speaker 3: to predict supply and demand so they know what to
17:31
Speaker 3: have on the shelves so that it can be demanded.
17:34
Speaker 3: So the news headline here is that eight member countries
17:37
Speaker 3: of OPEC plus are going to raise oil production by
17:39
Speaker 3: about one hundred and thirty seven thousand barrels per day.
17:42
Speaker 2: So that sounds like the opposite, right, We're.
17:43
Speaker 3: Gonna push supply, right, But afterwards, and here's the really
17:47
Speaker 3: big part of the headline, the media part, they're gonna
17:49
Speaker 3: pause any further output hikes for Q one twenty twenty six,
17:53
Speaker 3: so they're going to back off on all of it
17:55
Speaker 3: between January and March and next year. So this, of course,
17:58
Speaker 3: any hint that we're going to reduce supply will of
18:00
Speaker 3: course push prices up. Brent crude moved up to about
18:03
Speaker 3: sixty five bucks a barrel, and then the West Texas
18:05
Speaker 3: flavor sixty one nineteen or thereabouts. So now that concern
18:10
Speaker 3: is that the new market may face a supply surplus
18:13
Speaker 3: here and by weaker demand expectations for twenty twenty six.
18:17
Speaker 3: So that's why are they doing this again, trying to
18:20
Speaker 3: match up supply and demand and so just just something
18:23
Speaker 3: to pay attention to in the background of otherwise a
18:26
Speaker 3: relatively healthy economy.
18:27
Speaker 2: But that's certainly going to have an impact somewhere along
18:28
Speaker 2: the way.
18:29
Speaker 1: Well, I know we've been messing around with sanctions on Russia.
18:32
Speaker 1: They are still a big supplier of global oil notwithstanding
18:35
Speaker 1: our sanctions. Obviously there are other countries out there that
18:37
Speaker 1: are willing to gobble up rushes like it may perhaps
18:39
Speaker 1: cheaper oil, but are they wrestling at all with our
18:44
Speaker 1: sanctions on Russia or Russia's supply on the open market.
18:48
Speaker 1: Is that something that's been factored into this decision making Brian, Everything.
18:52
Speaker 2: Especially with oil.
18:53
Speaker 3: Oil is the same no matter where you dig it
18:54
Speaker 3: out of the grounds, so wherever you get it from,
18:57
Speaker 3: and that's why everything's so connected. You mentioned earlier oil
19:00
Speaker 3: US market. We pump about thirteen million barrels a day
19:03
Speaker 3: and that's historically high. But those just because we pump
19:06
Speaker 3: it at home does not mean that our oil prices
19:08
Speaker 3: are not impacted by what is being paid elsewhere, because again,
19:12
Speaker 3: it's all the same product that comes out of the ground.
19:14
Speaker 3: So if other large entities change the prices, that's of
19:17
Speaker 3: course going to ripple through and the Brint prices. That's
19:20
Speaker 3: basically out of the UK West Texas of course is here.
19:23
Speaker 3: All that stuff moves in tandem. So whenever OPEC signals
19:26
Speaker 3: it's going to tighten or loosen supply, those traders react
19:29
Speaker 3: instantly and they move the price accordingly.
19:31
Speaker 2: Doesn't matter where it came out of the ground.
19:33
Speaker 1: All right, real quick, I don't know how much could
19:37
Speaker 1: possibly exist at sea, but I've seen quite a few
19:40
Speaker 1: articles about these tankers that are just floating around out
19:43
Speaker 1: there in the world that are just filled with oil
19:45
Speaker 1: and there's just idly sitting by. Are they waiting for
19:48
Speaker 1: the price to go up before they bring that in
19:49
Speaker 1: or what's the story? And is that really have a
19:52
Speaker 1: global impact given the finite amount of tankers that could
19:54
Speaker 1: possibly be filled.
19:55
Speaker 2: Oh yeah, And that's why, you know, we think about it.
19:57
Speaker 3: Oil is priced every single minute of every sing day,
20:00
Speaker 3: just like the stock market, you know, So therefore there
20:03
Speaker 3: are there's a reason to make it, bring to bring
20:05
Speaker 3: it into port today versus tomorrow, And so absolutely they'll
20:08
Speaker 3: they'll kind of change their routes or slow things down
20:11
Speaker 3: a little bit if they think that if they bring
20:12
Speaker 3: it on Tuesday versus Monday, it'll squeez.
20:15
Speaker 2: Out a little more income. So absolutely that has an impact.
20:18
Speaker 1: One more question I got for you, Brian James, because
20:20
Speaker 1: you know, I've been waiting patiently and hopefully for the
20:23
Speaker 1: future when we finally wake up that given our energy
20:25
Speaker 1: demand needs, that we finally will start building what they
20:28
Speaker 1: call small modular reactors, which are safe and only you
20:30
Speaker 1: need five percent of rich uranium, which don't have any ways,
20:34
Speaker 1: military has been running on these things for a long time. Anyway,
20:36
Speaker 1: more and more people talking about it. Once you get
20:38
Speaker 1: the AI facilities and the multi billionaires who own them
20:41
Speaker 1: to step up and start demanding that we want our
20:43
Speaker 1: own miniature nuclear plants, it sounds to me like OPEC's
20:46
Speaker 1: future maybe on the rocks a little bit. And I'm
20:48
Speaker 1: sure they think about this. But if you can get
20:51
Speaker 1: nuclear power as opposed to see gas power or goil
20:54
Speaker 1: power or any other form of power, it's efficient and
20:57
Speaker 1: it's abundant. This is going to impact the oil market
21:00
Speaker 1: down the road.
21:01
Speaker 2: Absolutely it will.
21:02
Speaker 3: And so that's why you know you commonly hear you
21:05
Speaker 3: know the oil companies.
21:08
Speaker 2: I go back to the who killed the original electric car?
21:10
Speaker 3: This thirty years ago when this story came out and
21:12
Speaker 3: it actually happened earlier than that. But yeah, of course
21:15
Speaker 3: they're going to defend their needs there, and I don't
21:19
Speaker 3: think we're going to see.
21:20
Speaker 2: A lot of public outrage or public.
21:22
Speaker 3: Demand for it until, as you mentioned, all these data
21:24
Speaker 3: centers and things are going to start sucking energy that
21:27
Speaker 3: is going to filter through.
21:28
Speaker 2: So they're building.
21:29
Speaker 3: Somebody's building a big data center up in Trenton, and
21:31
Speaker 3: that's going to have a pretty significant impact on the
21:33
Speaker 3: local power grid up there, and it's probably going to
21:35
Speaker 3: have an impact on the prices people are paying in
21:37
Speaker 3: that area. And that's happening all over the country as
21:39
Speaker 3: these data centers are becoming more and more important, with
21:41
Speaker 3: AI becoming more prevalent. So I think when that starts
21:45
Speaker 3: hitting electric bills, you're going to start to see more
21:47
Speaker 3: and more demand for you know, maybe let's worry less
21:49
Speaker 3: about what nuclear stuff has meant in the past and
21:52
Speaker 3: worry about the future because in the benefits that it
21:55
Speaker 3: can provide for us. Right now, I don't think we're
21:56
Speaker 3: there yet. It's too easy politically to just say let's
21:59
Speaker 3: keep pulling oil out.
22:00
Speaker 1: Yeah, people will wake up to the reality we're not
22:02
Speaker 1: building three mile island type plants anymore. The concerns and
22:06
Speaker 1: challenges faced by those are no longer existent with modern
22:10
Speaker 1: technology anyway, Brian James, always great having you on. Appreciate
22:13
Speaker 1: your willingness to talk about these great topics with my
22:15
Speaker 1: listeners me and how they might impact the retirement in future.
22:18
Speaker 1: And always recommend, right Brian, get a financial planner sitting
22:21
Speaker 1: on your side of the table so you get sound
22:22
Speaker 1: advice with a fiduciary obligation.
22:25
Speaker 3: Yep, absolutely, that's what we say every day. And keep
22:27
Speaker 3: an eye on those Bengals headlines and we'll check in next.
22:29
Speaker 1: Week, Yes we will. Thanks Brian, take care of a
22:32
Speaker 1: great week. Eight thirty five fifty five care se Detok
22:34
Speaker 1: station phone lines well, they will be open if you want.