Latest / The Financial Exchange Show / Is Baby Boomer spending the only thing keeping up the economy?

Transcript

Is Baby Boomer spending the only thing keeping up the economy? · The Financial Exchange Show

• 0:00
  Speaker 1: The Financial Exchange is produced by Money Matters Radio and
• 0:02
  Speaker 1: is hosted by employees of the Armstrong Advisory Group, a
• 0:05
  Speaker 1: registered investment advisor. All opinions expressed are solely those of
• 0:08
  Speaker 1: the hosts. Do not reflect the opinions of Armstrong Advisory
• 0:11
  Speaker 1: or anyone else. Investments can lose money. This program does
• 0:14
  Speaker 1: not offer any specific financial or investment advice. Please consult
• 0:17
  Speaker 1: your own financial, tax, and estate planning advisors before making
• 0:20
  Speaker 1: any investment decisions. Armstrong Advisory and the advertisers heard on
• 0:23
  Speaker 1: this program do not endorse each other or their services.
• 0:26
  Speaker 1: Armstrong and Money Matters Radio do not compensate each other
• 0:28
  Speaker 1: for referrals and are not affiliated. This is the Financial
• 0:34
  Speaker 1: Exchange with Chuck Zada and Mike Armstrong, your exclusive look
• 0:39
  Speaker 1: at business and financial news affecting your day, your city,
• 0:42
  Speaker 1: your world. Stay informed and up to date about economic
• 0:46
  Speaker 1: and market trends plus breaking business news every day. The
• 0:50
  Speaker 1: Financial Exchange is a proud partner of the Disabled American
• 0:53
  Speaker 1: Veterans Department of Massachusetts. Help us support our great American
• 0:57
  Speaker 1: heroes by visiting DAV five k J Boston and making
• 1:01
  Speaker 1: a donation today. This is the Financial Exchange with Chuck
• 1:05
  Speaker 1: Zada and Mike Armstrong.
• 1:09
  Speaker 2: Chuck, Mike and Soccer with you. And our top story
• 1:13
  Speaker 2: today is the US jobs market and what exactly are
• 1:19
  Speaker 2: we seeing there? Well, we talked yesterday. Look, we're not
• 1:21
  Speaker 2: going to get a jobs report tomorrow, that much.
• 1:24
  Speaker 3: We know.
• 1:25
  Speaker 2: Hopefully we're able to get one in early November, but
• 1:28
  Speaker 2: you never know how long the federal government's going to
• 1:31
  Speaker 2: be shut down for the last one that we saw
• 1:33
  Speaker 2: in twenty eighteen was thirty five days, which if we
• 1:36
  Speaker 2: end up going that route, means we're not going to
• 1:38
  Speaker 2: be getting an October jobs report either.
• 1:41
  Speaker 4: And was that twenty twelve the longest in history at
• 1:43
  Speaker 4: sixty some odd days.
• 1:45
  Speaker 3: I don't remember if it's the longest in history or
• 1:47
  Speaker 3: longest in modern history, but certainly the longest I.
• 1:49
  Speaker 2: Recall, I don't think we've reached that long.
• 1:51
  Speaker 4: We didn't in twenty twelve.
• 1:52
  Speaker 2: No, I could be wrong. The data I was looking
• 1:55
  Speaker 2: at yesterday, we didn't have one in twenty twelve. We
• 1:59
  Speaker 2: had a twenty third teen one that was sixteen days,
• 2:01
  Speaker 2: and a ninety five one that was twenty one days.
• 2:03
  Speaker 2: There's the only other ones aside from seventy eight to
• 2:05
  Speaker 2: seventeen days that was that long, but the thirty four
• 2:09
  Speaker 2: day one at the end of twenty eighteen and early
• 2:11
  Speaker 2: twenty nineteen is the longest that I see on record.
• 2:15
  Speaker 2: I'm happy to be corrected if that's wrong, but this
• 2:19
  Speaker 2: is what I've seen to this point. So there's the
• 2:23
  Speaker 2: possibility that we might go two months without a jobs report,
• 2:27
  Speaker 2: in which case we have to start to rely more
• 2:30
  Speaker 2: heavily on other sources, private sources that are not government based,
• 2:36
  Speaker 2: and what we've been seeing from those in the last
• 2:39
  Speaker 2: couple of weeks has not been encouraging. Whether you look
• 2:43
  Speaker 2: at the ADP numbers yesterday, where we saw a negative
• 2:47
  Speaker 2: print not only you know for yesterday, but a downward
• 2:51
  Speaker 2: revision up from ADP on the prior month as well,
• 2:55
  Speaker 2: which now is slightly negative at a two thousand job
• 3:00
  Speaker 2: loss for the prior month. This compares to you know,
• 3:04
  Speaker 2: thirty two thousand jobs lost according to ADP data for September.
• 3:09
  Speaker 2: You also take a look at data that we get
• 3:11
  Speaker 2: from Paychecks. They have their small business Jobs index that
• 3:15
  Speaker 2: they run that showed a decline of point three one
• 3:18
  Speaker 2: percent for the month of September as well. You take
• 3:22
  Speaker 2: a look at the data from INDEED on job postings,
• 3:25
  Speaker 2: and that has shown a decline across the month of September.
• 3:29
  Speaker 3: As well as the last kind of government data point
• 3:32
  Speaker 3: that we got on jobs, which was the Job Openings Report,
• 3:35
  Speaker 3: which also showed a decline in both hirings and hiring.
• 3:38
  Speaker 2: And hirings and quits. So the data that we have
• 3:42
  Speaker 2: that is you know, again, I always you'll hear us
• 3:46
  Speaker 2: say this on our show quite often. Hey, don't pay
• 3:48
  Speaker 2: it too much attention to any one data point because
• 3:50
  Speaker 2: it doesn't matter a ton and it could be skewed
• 3:52
  Speaker 2: by you know, the way the survey has done this
• 3:54
  Speaker 2: and that when you have three, four or five data
• 3:58
  Speaker 2: points that are all pointing in the same direction, it
• 4:01
  Speaker 2: allows you to build confidence. It's kind of like if
• 4:04
  Speaker 2: you're if you're walking in a pitch black cave and
• 4:09
  Speaker 2: you're running your hand along the wall and it goes
• 4:13
  Speaker 2: from you know, really rough to smooth. You might be like, oh, like,
• 4:17
  Speaker 2: am I inside a room now instead of just a cave?
• 4:20
  Speaker 2: And then you take a step and the bottom falls
• 4:24
  Speaker 2: out and you're like, no, I'm not in a room,
• 4:25
  Speaker 2: Like something just like dropped off. Like it's a different
• 4:27
  Speaker 2: kind of rocker. But if you feel that smoothness, and
• 4:31
  Speaker 2: then you start to hear, you know, the coick of
• 4:33
  Speaker 2: your heels on you know, a floor. You say, okay,
• 4:37
  Speaker 2: like I'm in a room now, because your brain gathers
• 4:39
  Speaker 2: more information. It's the same thing when we're looking at
• 4:41
  Speaker 2: the economy. We're kind of in a dark room, like
• 4:43
  Speaker 2: looking around and not looking but feeling around. And you
• 4:47
  Speaker 2: feel one thing and you're like, okay, like maybe that
• 4:49
  Speaker 2: means something. But when you start to get like three
• 4:51
  Speaker 2: or four things adding up, you say, yeah, there might
• 4:54
  Speaker 2: be something here. So the data in the aggregate is
• 4:57
  Speaker 2: pointing towards a weaker labor market. There are a couple
• 5:03
  Speaker 2: of questions about this that are unique to where we
• 5:06
  Speaker 2: are right now. The first being that there is a
• 5:10
  Speaker 2: decent chance that labor supply is either flat or declining
• 5:15
  Speaker 2: because of the combination of baby boomers retiring faster than
• 5:19
  Speaker 2: gen zers can replace them, and immigration potentially becoming flat
• 5:25
  Speaker 2: or net negative this year, and a number of people
• 5:29
  Speaker 2: who are not in the country legally that we're working
• 5:31
  Speaker 2: in the country that may not be working anymore because
• 5:34
  Speaker 2: they're either no longer in the United States or they're
• 5:37
  Speaker 2: afraid to go to work for fear of being deported.
• 5:40
  Speaker 3: Yeah, all of those things, I guess counteract the trend
• 5:44
  Speaker 3: line that we are seeing on the job hiring rate.
• 5:47
  Speaker 3: But even with that effect, right, that that side will
• 5:52
  Speaker 3: affect the unemployment rate. It will help us define the
• 5:57
  Speaker 3: tightness of the labor market. But what seems to be
• 6:01
  Speaker 3: rather clear from the data is that regardless of how
• 6:04
  Speaker 3: tight the unemployment situation is, we're not seeing growth in
• 6:08
  Speaker 3: the number of people working, correct, And that indicates regardless
• 6:13
  Speaker 3: of the tightness of the labor market, regardless of how
• 6:15
  Speaker 3: many people are looking for work compared to a few
• 6:18
  Speaker 3: years ago, it means that growth has slowed.
• 6:21
  Speaker 2: Labor market growth. Yes, And this is where we get
• 6:24
  Speaker 2: to the thirty four trillion dollar question, which is does
• 6:30
  Speaker 2: this matter to the US economy? And historically the answer
• 6:35
  Speaker 2: has been yes, because the vast majority of money spent
• 6:39
  Speaker 2: in the US has been earned through labor. If the
• 6:45
  Speaker 2: number of people working is not growing and the number
• 6:49
  Speaker 2: of dollars being paid to those people is not growing,
• 6:53
  Speaker 2: the US economy historically has not grown. It's basically how
• 6:57
  Speaker 2: it works. The question about it be different this time,
• 7:01
  Speaker 2: and I know that we always hate like when that
• 7:02
  Speaker 2: comes up, but I think this is one worth exploring
• 7:05
  Speaker 2: because I'm just asking can it be different? Not?
• 7:08
  Speaker 4: Yes, it's different.
• 7:11
  Speaker 2: The really interesting thing right now is twofold. So I
• 7:14
  Speaker 2: guess it's two really interesting things. The first one, do
• 7:20
  Speaker 2: we exist in a world right now where so many
• 7:23
  Speaker 2: people in the United States are so lowly paid that
• 7:28
  Speaker 2: their income is such a small share of overall income
• 7:31
  Speaker 2: that even though they're really struggling right now, it doesn't
• 7:35
  Speaker 2: register as a meaningful shift in the trajectory of the economy.
• 7:39
  Speaker 3: We've covered plenty of metrics to prove this out, that
• 7:42
  Speaker 3: half of the spending is coming from the top ten
• 7:44
  Speaker 3: percent of income earners, that the bottom half of American
• 7:48
  Speaker 3: income owners are accounting for a I don't remember the
• 7:51
  Speaker 3: fraction there, but a very small portion of total spending,
• 7:54
  Speaker 3: And so, okay, I could potentially buy that argument.
• 7:59
  Speaker 2: Potentially, but ultimately the shift that we've seen, I don't
• 8:03
  Speaker 2: know that it's big enough to explain that right of itself, because.
• 8:07
  Speaker 3: This has been the case to a lesser degree four
• 8:10
  Speaker 3: decades now. Right the ten percent accounting for half of
• 8:12
  Speaker 3: the spending, maybe they were accounting for forty two percent
• 8:16
  Speaker 3: of spending three decades ago or three decades ago. But
• 8:19
  Speaker 3: it wasn't like they were accounting for ten percent of
• 8:22
  Speaker 3: spending no decades ago.
• 8:23
  Speaker 2: So like, does the shift from hey, they've gone from
• 8:26
  Speaker 2: accounting for like forty seven to fifty two percent of
• 8:29
  Speaker 2: the spending? Does that matter?
• 8:31
  Speaker 4: It matters?
• 8:32
  Speaker 2: Does it matter enough to overcome a slow down in
• 8:35
  Speaker 2: the overall economy of this magnitude? I don't think so.
• 8:39
  Speaker 2: I think it can explain some of it, but not
• 8:41
  Speaker 2: all of it. The other piece, and this is this
• 8:47
  Speaker 2: is the This is personally like my white whale that
• 8:51
  Speaker 2: I believe in. But I'm waiting to see if this
• 8:56
  Speaker 2: is like actually the whale or if it's just you know,
• 8:58
  Speaker 2: the mirage lag out there in the is this title
• 9:03
  Speaker 2: wave of baby boomer retirements and the fact that we
• 9:07
  Speaker 2: are getting older as a society as a whole, and
• 9:11
  Speaker 2: baby boomers don't care. Aside from you, there are baby
• 9:16
  Speaker 2: boomers that are working, but the vast majority are heading
• 9:18
  Speaker 2: towards retirement or already in retirement.
• 9:20
  Speaker 4: Yea, what do we have the youngest baby boomer at
• 9:22
  Speaker 4: sixty two now?
• 9:23
  Speaker 2: Yes, and so the vast like you look at the
• 9:26
  Speaker 2: median age of boomers and it's sixty nine seventy years old.
• 9:30
  Speaker 2: So you're getting to the point where more are retired
• 9:34
  Speaker 2: or retiring this year than there are you know, left
• 9:37
  Speaker 2: to retire, and so you've got this title wave of
• 9:40
  Speaker 2: boomer retirements and when that happens. If you are a
• 9:43
  Speaker 2: baby boomer that's retired, there are generally two things that
• 9:47
  Speaker 2: dictate your spending. Your Social Security benefit pension benefit as well,
• 9:53
  Speaker 2: but there's just not many of those left even for
• 9:55
  Speaker 2: boomers at this point, and the size of your portfolio.
• 10:00
  Speaker 2: So the question is, look, social Security benefits aren't changing.
• 10:04
  Speaker 2: Even with the government shutdown, nothing happens to them. So
• 10:08
  Speaker 2: you say, great, I'm spending that money, doesn't matter what
• 10:11
  Speaker 2: the job market's doing, and there's more people collecting now
• 10:13
  Speaker 2: than ever before. Portfolio size, last I checked, Michael, the
• 10:19
  Speaker 2: S and P five hundred was at an all time
• 10:21
  Speaker 2: high yesterday, which means baby boomer anonymous, you know, opens
• 10:26
  Speaker 2: up their portfolio and says, oh, look, I got more
• 10:29
  Speaker 2: money at the start of October. We're gonna be buying
• 10:32
  Speaker 2: some Christmas gifts this year. That's I don't know why,
• 10:35
  Speaker 2: that's what the average baby boomer sounds like, but that's accurate. Yeah,
• 10:38
  Speaker 2: And so the question that I think.
• 10:41
  Speaker 4: Happy Gilmore oh happy, got a new portfolio.
• 10:46
  Speaker 2: So you look at this, Adam Sandlers technically gen x
• 10:50
  Speaker 2: Y late early late or early gen X yeah, not
• 10:54
  Speaker 2: quite late, not quite late boomer. So you look at
• 10:59
  Speaker 2: this and I wonder, have we reached a point where
• 11:05
  Speaker 2: more of the consumer spending is now being driven by
• 11:08
  Speaker 2: social security and asset based spending as opposed to income
• 11:11
  Speaker 2: based spending, where those wiggles in the labor market don't
• 11:16
  Speaker 2: matter as much. And the problem is we're not going
• 11:20
  Speaker 2: to know for like two or three years. Yeah, it's
• 11:24
  Speaker 2: possible we've crossed that event horizon and are now just
• 11:27
  Speaker 2: in a different world where things matter differently. The other thing,
• 11:32
  Speaker 2: just if you want to know where this is going,
• 11:33
  Speaker 2: like fifteen years from now, if you want to get
• 11:35
  Speaker 2: like really morbid, but also kind of like really, hey,
• 11:38
  Speaker 2: this could be kind of trippy. Remember that with the
• 11:42
  Speaker 2: changes to the required minimum distribution laws and changes to
• 11:47
  Speaker 2: inherited IRA laws, non spouse beneficiaries of iras now after
• 11:51
  Speaker 2: withdraw money in a ten year period from iras, when
• 11:55
  Speaker 2: baby boomers move on to that next phase, which unfortunately
• 11:58
  Speaker 2: is passing away. The thing I wonder about for the
• 12:01
  Speaker 2: stock market, does that accelerated schedule of forced withdrawals and
• 12:06
  Speaker 2: sales impact the market in a negative way, the opposite
• 12:11
  Speaker 2: of how four to one case savings has provided consistently
• 12:15
  Speaker 2: positive flows to Marcus.
• 12:17
  Speaker 3: Let's continue to talk about this when we come back,
• 12:18
  Speaker 3: because if spending is now tied dramatically to the stock market,
• 12:24
  Speaker 3: then it raises a whole number of questions of the
• 12:29
  Speaker 3: value of the stock market. What Congression, congressional lawmakers, and
• 12:33
  Speaker 3: the Fed can practically do in the event of a
• 12:36
  Speaker 3: stock market downturn.
• 12:37
  Speaker 2: There's some juice stuff here.
• 12:38
  Speaker 4: You know precisely what is too big to fail? I
• 12:41
  Speaker 4: guess is the question when when you have something.
• 12:43
  Speaker 2: Well, it's the question is like, is Mike Armstrong too
• 12:48
  Speaker 2: big to fail? Is that a weight joke?
• 12:50
  Speaker 4: Yes?
• 12:52
  Speaker 2: And a hype joke. More of this when we come back.
• 12:57
  Speaker 1: Text US six one, seven, three, six, two eighty five
• 13:01
  Speaker 1: with your comments and questions about today's show, and let
• 13:04
  Speaker 1: us know what you think about the stories we are covering.
• 13:06
  Speaker 1: This is the Financial Exchange Radio Network, breaking business and
• 13:11
  Speaker 1: financial news first throughout the day only here on the
• 13:15
  Speaker 1: Financial Exchange Radio Network.
• 13:31
  Speaker 2: Towards the NDA last segment, I raised the question about
• 13:34
  Speaker 2: the United States consumer spending starting like, is it going
• 13:39
  Speaker 2: is it starting to be driven more by asset prices
• 13:43
  Speaker 2: as opposed to incomes because of demographics and things along
• 13:49
  Speaker 2: those lines.
• 13:49
  Speaker 1: I e.
• 13:50
  Speaker 3: The value of your home, crypto portfolio, and stock portfolio
• 13:53
  Speaker 3: as opposed to your income coming in from your job.
• 13:56
  Speaker 2: Yes, And Mike said that he wanted to talk more
• 14:00
  Speaker 2: about that, so I'm going to let him talk more.
• 14:02
  Speaker 4: Yeah.
• 14:02
  Speaker 3: So look, if that is the case, I think most
• 14:06
  Speaker 3: stock market investors would generally agree that the stock market
• 14:10
  Speaker 3: doesn't always go up. I suppose that that's an easy
• 14:14
  Speaker 3: consideration to come to or conclusion to come to. And
• 14:16
  Speaker 3: so if spending, which drives two thirds three cores how
• 14:23
  Speaker 3: much of our economy is driven by consumer spending, two
• 14:26
  Speaker 3: thirds of our economy being driven by consumer spending, is
• 14:29
  Speaker 3: now all primarily tied to asset prices, and asset prices
• 14:36
  Speaker 3: presumably fall off a cliff at some point. Doesn't need
• 14:40
  Speaker 3: to be a two thousand and eight type situation, But
• 14:43
  Speaker 3: assume we go through a prolonged period of time where
• 14:45
  Speaker 3: asset prices between stocks, real estate, and the primary asks
• 14:53
  Speaker 3: that people invest in go through a period of time
• 14:55
  Speaker 3: where they are down by twenty to forty percent and
• 14:58
  Speaker 3: don't recover immediately, What do then happen to consumer spending?
• 15:01
  Speaker 3: And how does Congress react to something like that to
• 15:05
  Speaker 3: prevent a long drawn out recession where asset prices drive
• 15:10
  Speaker 3: the direction of the economy rather than the other way.
• 15:12
  Speaker 2: Around, or not even that, What if prices don't go up?
• 15:16
  Speaker 2: What if they're just flat? What does that mean?
• 15:20
  Speaker 1: You know?
• 15:20
  Speaker 2: I mean think about housing, just as an example, we've
• 15:24
  Speaker 2: talked about how unaffordable housing is for people. Despite that,
• 15:28
  Speaker 2: I don't think there's any world in which I envision,
• 15:31
  Speaker 2: you know, a twenty percent correction in home prices from
• 15:33
  Speaker 2: where we are, just because the problem is not home owners,
• 15:38
  Speaker 2: it's the incomes of everyone else who just have not
• 15:41
  Speaker 2: caught up to where home prices are. You know, Like
• 15:44
  Speaker 2: we don't have a bunch of people that are, you know,
• 15:46
  Speaker 2: struggling to pay their mortgages right now, because we see
• 15:50
  Speaker 2: the delinquency data and it looks nothing like two thousand
• 15:52
  Speaker 2: and six, two thousand and seven. But what if the
• 15:56
  Speaker 2: way that home price is correct isn't by going down
• 15:59
  Speaker 2: fifteen twenty percent. What if they're just flat for like
• 16:02
  Speaker 2: five or six years?
• 16:03
  Speaker 4: Right?
• 16:05
  Speaker 2: What does that mean?
• 16:06
  Speaker 4: Yeah?
• 16:06
  Speaker 2: You know, like, how does that influence things stock prices,
• 16:12
  Speaker 2: What if they don't fall, you know, twenty thirty forty percent,
• 16:16
  Speaker 2: But what if they just don't go anywhere for a
• 16:20
  Speaker 2: few years. You know what. Obviously they chop around because
• 16:24
  Speaker 2: like they're never just flat, But what if it's up ten,
• 16:27
  Speaker 2: down ten, and then you know, up three? You know, like,
• 16:31
  Speaker 2: what what does one do with this in terms of
• 16:35
  Speaker 2: how it impacts spending? And the answer, quite honestly is
• 16:38
  Speaker 2: we don't know, because we've never been in this environment before.
• 16:42
  Speaker 2: What we do know is the levers that are typically
• 16:45
  Speaker 2: pulled in order to stabilize the US economy in the
• 16:50
  Speaker 2: event of a downturn are typically geared towards generating demand
• 16:55
  Speaker 2: through economic activity that leads to hiring. If you you
• 17:00
  Speaker 2: either don't have the people too higher, then all that
• 17:03
  Speaker 2: does is drive up wages for the labor that's already.
• 17:06
  Speaker 4: There, which makes inflation.
• 17:07
  Speaker 2: It just creates inflation because it's more expensive. Or Okay, great,
• 17:12
  Speaker 2: you created this economic activity, but it still doesn't matter
• 17:17
  Speaker 2: because it's not enough to offset the drag from asset
• 17:21
  Speaker 2: based spending.
• 17:22
  Speaker 3: It if you buy the argument that we're talking about
• 17:26
  Speaker 3: here right that consumer spending is now being driven more
• 17:29
  Speaker 3: and more by asset prices rather than incomes. That it
• 17:32
  Speaker 3: creates a really interesting, I guess backstop for equity markets
• 17:39
  Speaker 3: through government, which I don't like the idea of. But right,
• 17:43
  Speaker 3: if you buy this argument, and you do believe that
• 17:47
  Speaker 3: a key role of the Fed as well as Congress
• 17:50
  Speaker 3: is to support economic activity and growth, and that they
• 17:54
  Speaker 3: would react in the similar way that they have to
• 17:57
  Speaker 3: other previous recessions, then they won't be trying to juice hiring.
• 18:01
  Speaker 3: They will be trying to juice asset prices, which again
• 18:04
  Speaker 3: they have done previously. But this takes it to kind
• 18:07
  Speaker 3: of a different territory and leads to all sorts questions
• 18:11
  Speaker 3: like should valuations be permanently higher on equities based on
• 18:16
  Speaker 3: this you know, presumed backstop that the federal government will
• 18:19
  Speaker 3: have to put into place for asset prices. I hate
• 18:23
  Speaker 3: the idea of it. It goes right in the face
• 18:25
  Speaker 3: of free markets. But it might exist now in a
• 18:27
  Speaker 3: different way.
• 18:28
  Speaker 2: So in terms of where we are with all this,
• 18:34
  Speaker 2: I think we may be at a couple of different
• 18:36
  Speaker 2: turning points, but it's impossible to know for sure right now,
• 18:40
  Speaker 2: just because anything can look one way for a short
• 18:44
  Speaker 2: period of time. Case in point. Let's go back to
• 18:47
  Speaker 2: twenty twenty one. Mike, Do you remember when everyone in
• 18:49
  Speaker 2: their grandmother was going to be driving EV's by the
• 18:52
  Speaker 2: end of the deck? Do Now you've got Jim Farley's
• 18:54
  Speaker 2: CEO four being like, yeah, it might be like five
• 18:56
  Speaker 2: to seven percent of people that are buying evs. Oh,
• 19:00
  Speaker 2: that's kind of a big difference from everybody. Likewise, do
• 19:04
  Speaker 2: you remember the summer of twenty twenty when everyone was
• 19:07
  Speaker 2: writing about, you know, the death of cities and no
• 19:09
  Speaker 2: one would ever live in cities again. Gotta tell you,
• 19:12
  Speaker 2: I just spent last week in New York City.
• 19:14
  Speaker 4: Pretty busy.
• 19:15
  Speaker 2: Place is poppin'.
• 19:16
  Speaker 4: Yeah, place is popping.
• 19:19
  Speaker 2: Okay, So I think that when we look at this, yeah,
• 19:22
  Speaker 2: there's some things going on right now. I'm not ready
• 19:25
  Speaker 2: to be, you know, planting my flag saying this is
• 19:28
  Speaker 2: definitely happening. But my intenta are up and I'm looking for,
• 19:31
  Speaker 2: you know, some some ground there if it becomes a thing.
• 19:34
  Speaker 2: Let's take a quick break. When we return, it's Wall Street.
• 19:37
  Speaker 1: Watch like us on Facebook and follow us on Twitter
• 19:42
  Speaker 1: at TFE show. Breaking business news is always first right
• 19:47
  Speaker 1: here on the Financial Exchange Radio Network. Time Now for
• 19:52
  Speaker 1: Wall Street Watch a complete look at what's moving markets
• 19:56
  Speaker 1: so far today right here on the Financial Exchange Radio network.
• 20:00
  Speaker 5: Markets are mixed and remain mostly quiet on day two
• 20:03
  Speaker 5: of the government shutdown, as investors are left wondering about
• 20:05
  Speaker 5: the state of the labor market, with the shutdown pausing
• 20:09
  Speaker 5: economic data releases, including the September jobs report that was
• 20:13
  Speaker 5: slated to be published tomorrow morning. Right now, the Dow
• 20:16
  Speaker 5: is down by two tenths of one percent or eighty
• 20:19
  Speaker 5: seven points lower, SMP five hundred dipping by three points,
• 20:23
  Speaker 5: NASDAC up about a quarter percent or fifty nine points higher.
• 20:27
  Speaker 5: Russell two thousand is down about a tenth of a percent.
• 20:29
  Speaker 5: Ten year treasury yield is not showing up again. CNBC,
• 20:35
  Speaker 5: thanks for that. Crude oil doubt what maybe they're gone, Yeah,
• 20:39
  Speaker 5: probably it's gone. It's just evaporated.
• 20:41
  Speaker 2: Probably did.
• 20:42
  Speaker 5: Crude oil is down three quarters of a percent at
• 20:45
  Speaker 5: sixty one dollars in thirty one cents a barrel. Following
• 20:49
  Speaker 5: meta reports from earlier this week, Warren Buffett's Berkshire Hathaway
• 20:52
  Speaker 5: officially announced have reached a deal to buy Occidental Petroleum's
• 20:56
  Speaker 5: petrochemical unit, Oxycom for nine point seven billion dollar in cash.
• 21:01
  Speaker 5: This marks Berkshire's largest deal since twenty twenty two, when
• 21:04
  Speaker 5: it paid eleven point six billion dollars for insurer Alleghany.
• 21:09
  Speaker 5: Berkshire stock is dipping, while Oxy shares are down by
• 21:13
  Speaker 5: five percent. Meanwhile, Tesla reported third quarter deliveries just north
• 21:17
  Speaker 5: of four hundred and ninety seven thousand vehicles, above street
• 21:20
  Speaker 5: expectations and seven percent higher over the year prior. Deliveries
• 21:25
  Speaker 5: in the period got a boost as some customers rushed
• 21:28
  Speaker 5: to buy cars ahead of the expiration of a key
• 21:30
  Speaker 5: federal tax credit. Tesla down by over one percent at
• 21:34
  Speaker 5: the moment. Elsewhere, fair Isaac shares are surging twenty three
• 21:39
  Speaker 5: percent after the credit analytics company unveil the system that
• 21:43
  Speaker 5: allows mortgage lenders to direct access to Fikos scores, allowing
• 21:48
  Speaker 5: resellers to bypass credit bureaus. TransUnion sinking eleven percent, while
• 21:53
  Speaker 5: Equifact shares are down over seven percent on that news
• 21:57
  Speaker 5: and after yesterday's near nine percent leap. Shares in Western
• 22:01
  Speaker 5: Digital retreating modestly today down about one percent. Nick reported,
• 22:06
  Speaker 5: citing CEO Irving Tan, that the data storage company will
• 22:10
  Speaker 5: invest one billion dollars in Japan over the.
• 22:12
  Speaker 2: Next half decade.
• 22:14
  Speaker 5: I'm Tucker Silva and that is Wall Street Watch.
• 22:18
  Speaker 2: We got to talk a little bit about open Ai.
• 22:21
  Speaker 2: They are raising six point six billion dollars through a
• 22:25
  Speaker 2: stock sale. It's valuing the company at five hundred billion dollars.
• 22:30
  Speaker 2: And here's basically where.
• 22:32
  Speaker 4: Like half a trillion better fine.
• 22:34
  Speaker 2: Here's basically I think where you have to land with
• 22:36
  Speaker 2: open Ai at this point, it's either going to be
• 22:40
  Speaker 2: a company that is worth trillions of dollars or it's
• 22:43
  Speaker 2: not going to be worth anything. I don't think there's
• 22:46
  Speaker 2: a because all that they do is AI, and it's
• 22:50
  Speaker 2: either going to become overly commoditized and they have no
• 22:54
  Speaker 2: special edge there, especially since their distribution partners are kind
• 22:59
  Speaker 2: of like, hey, we're trying to move away from you
• 23:01
  Speaker 2: wink wink Microsoft. You know, like so there's something there,
• 23:07
  Speaker 2: or they're going to come up with you know, this
• 23:10
  Speaker 2: tremendous you know uh, you know agi you know thing
• 23:15
  Speaker 2: that becomes you know, digitally smart intelligence. Yeah, that becomes
• 23:20
  Speaker 2: you know, smarter than all humans and wipes us out
• 23:23
  Speaker 2: while becoming you know, the only company on the planet.
• 23:26
  Speaker 2: I don't think there's much middle ground with them, and
• 23:28
  Speaker 2: I don't say that about the other AI companies because
• 23:30
  Speaker 2: the other the other AI companies do things other than AI. Sure,
• 23:34
  Speaker 2: Microsoft does, Meta does Amazon does?
• 23:39
  Speaker 4: Still? I mean does they existed prior still.
• 23:43
  Speaker 2: Be a market for all that? And here here's like
• 23:46
  Speaker 2: just if you want to know the numbers on this,
• 23:49
  Speaker 2: and this is from the information that published this. In
• 23:53
  Speaker 2: the first half of this year, openey I spent more
• 23:56
  Speaker 2: money on marketing and equity options for its employees than
• 24:00
  Speaker 2: it made in revenue. This is before you even get
• 24:05
  Speaker 2: to the cost of actually AI ing.
• 24:07
  Speaker 3: Yeah, all of that concerns me. How different is that
• 24:14
  Speaker 3: from giant companies today in their startup face? Right? If
• 24:20
  Speaker 3: I think about giant tech companies who dominated in the
• 24:24
  Speaker 3: early two thousands, such as Facebook, such as Uber, such
• 24:28
  Speaker 3: as Google, those are the ones that are still here. Yep, Yeah,
• 24:34
  Speaker 3: dozens who are not agreed. And I'm not going to
• 24:37
  Speaker 3: try and get into the business of who's going to
• 24:39
  Speaker 3: be the winner here. But look, I mean open ai
• 24:42
  Speaker 3: has done some pretty impressive first mover type things, right,
• 24:46
  Speaker 3: how many how many active users do they have on
• 24:48
  Speaker 3: their platform? And how quickly did they get there? I
• 24:50
  Speaker 3: know it is a heck of a lot faster than
• 24:52
  Speaker 3: any other tech platform.
• 24:53
  Speaker 2: In history, but there's still not generating any money, any profit.
• 24:58
  Speaker 2: And their revenue growth is fine, but like now, the
• 25:01
  Speaker 2: revenue is basically like doubling year over year, which is nice.
• 25:06
  Speaker 3: Yeah, but it's really tough to know what sort of
• 25:11
  Speaker 3: competitive advantage they have. How much better are you at
• 25:15
  Speaker 3: this than some new Chinese texts to startup that create
• 25:21
  Speaker 3: a deep sea? How much better are you at this
• 25:22
  Speaker 3: than Google? How much better are you at this than
• 25:24
  Speaker 3: Microsoft and other companies who are trying to develop these
• 25:27
  Speaker 3: tools that you can also run your platform on.
• 25:31
  Speaker 2: And by the way, like no one, no one wants
• 25:34
  Speaker 2: to pay open Ai for any of this.
• 25:38
  Speaker 5: Now.
• 25:39
  Speaker 2: And this is before we even get to like some
• 25:40
  Speaker 2: of the ethical stuff, which I'm gonna get to in
• 25:42
  Speaker 2: a minute. But Tucker, can you get the old time
• 25:44
  Speaker 2: machine fired up for me? We gotta go way back now.
• 25:47
  Speaker 2: We're doing about twenty five years if you can now. Yeah,
• 25:54
  Speaker 2: it's two thousand and one, and there's a company by
• 25:57
  Speaker 2: the name of Global Crossing Limited that you might be
• 25:59
  Speaker 2: famili Okay, uh, just two years prior to that, they
• 26:03
  Speaker 2: were valued at forty seven billion dollars. Yeah, they were hot.
• 26:07
  Speaker 2: Global Crossing Telecommunications, Golly, g willakers forty seven billion dollars
• 26:12
  Speaker 2: in value. How could anything ever happen to them? Well,
• 26:16
  Speaker 2: it turns out that on October third, twenty eleven, they
• 26:19
  Speaker 2: were acquired by Level three Communications for three billion dollars,
• 26:22
  Speaker 2: including the assumption of one point one billion dollars in debt.
• 26:25
  Speaker 2: Global Crossing, if you're not familiar with them, they're one
• 26:27
  Speaker 2: of the companies that laid all of the fiber optics
• 26:30
  Speaker 2: that we are still using today. The reason you are
• 26:33
  Speaker 2: listening to our show today is probably because some guy
• 26:36
  Speaker 2: from Global Crossing was laying fiber twenty seven years ago
• 26:40
  Speaker 2: and allows for you know, satellite transmissions to be you know,
• 26:43
  Speaker 2: then you know, carried through different networks and finally come
• 26:47
  Speaker 2: out radio towers like this. This is the reason why
• 26:50
  Speaker 2: the Internet exists today is because of Global Crossing. But
• 26:53
  Speaker 2: they don't exist. They went almost belly up but got
• 26:57
  Speaker 2: bailed out by a company that probably wanted some IP
• 27:00
  Speaker 2: for about five percent of their peak valuation.
• 27:03
  Speaker 4: Yep.
• 27:04
  Speaker 2: And I'm not saying that open AI is going to
• 27:06
  Speaker 2: be that. I'm just saying I don't know if they're
• 27:09
  Speaker 2: going to be that or if they're going to be Google,
• 27:11
  Speaker 2: because there is no middle ground for a company that's
• 27:14
  Speaker 2: built just on one product like this, and specifically that's
• 27:18
  Speaker 2: also focused on the actual build out of stuff like Stargate,
• 27:23
  Speaker 2: which is a huge amount of CAPEX that, by the way,
• 27:26
  Speaker 2: we might still be using twenty five years from now.
• 27:29
  Speaker 2: But maybe it's not open Aiy's you know, ownership anymore.
• 27:32
  Speaker 3: Yeah, and there are other companies that fall into this
• 27:34
  Speaker 3: similar category. I have to say, I think the comparison
• 27:38
  Speaker 3: that you just made there is not so much different
• 27:40
  Speaker 3: from the comparison that I've heard people make about in video.
• 27:43
  Speaker 3: They are creating a lot of the physical infrastructure to
• 27:47
  Speaker 3: run our.
• 27:50
  Speaker 4: Newest technology on.
• 27:52
  Speaker 3: And while they do have another business, I don't think that,
• 27:56
  Speaker 3: you know, manufacturing video game chips is going to be
• 27:58
  Speaker 3: quite as profitable as what they're doing today. And so
• 28:01
  Speaker 3: I don't know, and I don't think anyone has a
• 28:04
  Speaker 3: firm idea, but I do think that if ai doesn't
• 28:08
  Speaker 3: work out quite the way that people are predicting, Google's
• 28:11
  Speaker 3: gonna be okay, Microsoft's gonna be just fine.
• 28:13
  Speaker 2: And even in video, I think the middle case is Okay,
• 28:15
  Speaker 2: they become Cisco and they're fine, Like they're still there
• 28:20
  Speaker 2: and they just you know, go along and start paying
• 28:22
  Speaker 2: a dividend ten years from now, and that's what they
• 28:25
  Speaker 2: become because their chips might there might not be this
• 28:28
  Speaker 2: huge explosion of growth that's needed for them, but they
• 28:32
  Speaker 2: clearly make a very good product that's gonna find its
• 28:34
  Speaker 2: home somewhere. And maybe it's just the margins come down.
• 28:37
  Speaker 2: There's more competition because oh, by the way, did you
• 28:39
  Speaker 2: see earlier this week Microsoft says, yeah, we want to
• 28:42
  Speaker 2: build our own chips in house. We don't want to
• 28:44
  Speaker 2: be paying premium prices forever. And so like that's what
• 28:47
  Speaker 2: happens with hardware manufacturers, you know, competition comes in and
• 28:52
  Speaker 2: margins go down, and that's the deal. Open Ai.
• 28:56
  Speaker 3: Open ai is not that they're not that and and
• 28:59
  Speaker 3: this is just ession of how good are you at
• 29:01
  Speaker 3: continuing to innovate and then finally finding a way to
• 29:04
  Speaker 3: monetize your product.
• 29:05
  Speaker 2: And this is before you even get to, you know,
• 29:08
  Speaker 2: the stuff that they're now enabling and allowing you to do,
• 29:11
  Speaker 2: such as, hey, they just released the newest version of
• 29:15
  Speaker 2: their Sora video generator, and within minutes someone had made
• 29:22
  Speaker 2: Sam Altman, CEO of open Ai, you know, wearing full
• 29:27
  Speaker 2: you know, European World War two Army regalia and hey, like,
• 29:33
  Speaker 2: we're totally not prepared for being able to distinguish real
• 29:37
  Speaker 2: from not and this is a huge problem.
• 29:39
  Speaker 4: Yeah, we aren't. We are not.
• 29:44
  Speaker 3: And I will just say that open ai is not
• 29:46
  Speaker 3: even close to the only company that bear some burden.
• 29:49
  Speaker 4: Four.
• 29:49
  Speaker 2: Now we've talked about better and all this stuff, and
• 29:52
  Speaker 2: other startups that are you know, are building their own
• 29:54
  Speaker 2: models for the express design of you know, creating scams
• 29:59
  Speaker 2: and and all sorts of things.
• 30:02
  Speaker 3: It's not to say open ai shouldn't do better. It
• 30:04
  Speaker 3: is merely to say that they are on a long
• 30:07
  Speaker 3: laundry list of companies who have some pretty bad ethical
• 30:10
  Speaker 3: stuff when it comes to AI.
• 30:11
  Speaker 2: Yes, let's take a quick break, and when we return,
• 30:17
  Speaker 2: where do I want to get to? I want to
• 30:18
  Speaker 2: talk about student loan debts strangling gen X because Tucker
• 30:22
  Speaker 2: put this in our stack for two days in a row,
• 30:24
  Speaker 2: which means he wants us to cover it, so I
• 30:26
  Speaker 2: want to make sure we cover it. Oh wait, right after.
• 30:28
  Speaker 1: This, miss any of the show. Catch up at your
• 30:32
  Speaker 1: convenience by visiting Financial Exchange show dot com and clicking
• 30:35
  Speaker 1: the on demand icon, where you'll find all of our
• 30:38
  Speaker 1: interviews and full shows. This is your home for the
• 30:41
  Speaker 1: latest business and financial news in New England and around
• 30:44
  Speaker 1: the country. This is the Financial Exchange Radio Network. The
• 30:49
  Speaker 1: Financial Exchange streams live on YouTube. Like our page and
• 30:53
  Speaker 1: stay up to date on breaking business news all morning long.
• 30:56
  Speaker 1: This is the Financial Exchange Radio Network.
• 31:07
  Speaker 5: This segment of The Financial Exchange is brought to you
• 31:09
  Speaker 5: by the US Virgin Islands Department of Tourism. Looking for
• 31:12
  Speaker 5: a getaway that's easy, warm, and unforgettable. Discover the magic
• 31:16
  Speaker 5: of the US Virgin Islands Saint Croix, Saint Thomas and
• 31:19
  Speaker 5: Saint John. Just a short flight from New England, with
• 31:22
  Speaker 5: no passport needed and no money to exchange. Soak up
• 31:26
  Speaker 5: the sun, stroll along white sand beaches and field the
• 31:28
  Speaker 5: rhythm of the heartbeat of the Islands. The USBI is
• 31:32
  Speaker 5: America's Caribbean paradise. Plan your fall escape now at visit
• 31:35
  Speaker 5: USVII dot com. That's visit USBI dot com.
• 31:40
  Speaker 2: It's been a little while since we talked about student loans,
• 31:42
  Speaker 2: which means that we need to talk about student loans
• 31:44
  Speaker 2: because student loans peace In the Wall Street Journal, student
• 31:49
  Speaker 2: loan debt is strangling jen X and it uses a
• 31:53
  Speaker 2: nifty little chart to show that people age fifty to
• 31:56
  Speaker 2: sixty one years old have the highest level of student
• 31:59
  Speaker 2: loan debt per borrower out of any age group, which
• 32:03
  Speaker 2: is true. But and here's the butt on this. If
• 32:09
  Speaker 2: you look at the breakdown of student loan borrowers by
• 32:14
  Speaker 2: age group, that age fifty to sixty one demographic has
• 32:19
  Speaker 2: six point two million borrowers in it, compared to the
• 32:23
  Speaker 2: twenty five to thirty four and thirty four to forty
• 32:26
  Speaker 2: nine demos having more than double that. And so the
• 32:30
  Speaker 2: point that I will make is that when you look
• 32:34
  Speaker 2: at this on a percentage basis, there are fewer people
• 32:38
  Speaker 2: in gen X that have student loans outstanding than other
• 32:42
  Speaker 2: demos that are younger than them. And as such, I
• 32:46
  Speaker 2: can't really look at this and say that it's a
• 32:49
  Speaker 2: meaningful factor for most of Gen X simply because the
• 32:53
  Speaker 2: vast majority of Gen X does not have student loan debt.
• 32:56
  Speaker 2: The ones that do have more outstanding. And clear there
• 33:00
  Speaker 2: are problems with the student loan system that have led
• 33:02
  Speaker 2: to this point, but overall, it's not like most people
• 33:06
  Speaker 2: in gen X have student loans right now.
• 33:08
  Speaker 3: Yeah, My question is how many baby boomers had student
• 33:12
  Speaker 3: loan debt when they reached retirement, because my sense would
• 33:15
  Speaker 3: be that this is kind of the first generation to
• 33:18
  Speaker 3: have a significant portion of their generation in this situation,
• 33:23
  Speaker 3: and it's only going to get worse from here. So
• 33:26
  Speaker 3: I am curious to see how that develops, how it
• 33:29
  Speaker 3: affects retirement for this group, because remember gen Xer's oldest
• 33:32
  Speaker 3: Gen Xers turned sixty years old this year. They are
• 33:36
  Speaker 3: staring down retirement very shortly. And I suspect that their
• 33:41
  Speaker 3: student loan debt situation is worse than the baby boomer
• 33:45
  Speaker 3: generation before them, but I'm not certain it is.
• 33:49
  Speaker 2: There are two point eight million borrowers age sixty two
• 33:52
  Speaker 2: and older. Okay, I don't know how many of those
• 33:55
  Speaker 2: are just parents on parent plus loans. Yeah that and
• 33:58
  Speaker 2: even with you know, Gen x I don't know how
• 34:00
  Speaker 2: how many are parent plus loans for their current, you know,
• 34:03
  Speaker 2: twenty five year old children. So it's hard to sort
• 34:08
  Speaker 2: through some of that data on there because it doesn't
• 34:11
  Speaker 2: get broken out in that fashion. But I think it's
• 34:16
  Speaker 2: clear that the way student debt is set up right now, Hey,
• 34:21
  Speaker 2: if you take out a bunch of money for you know,
• 34:23
  Speaker 2: under the idea of, hey, these jobs are going to
• 34:25
  Speaker 2: pay for that loan and they don't, you do end
• 34:29
  Speaker 2: up getting stuck with it for the rest of your life.
• 34:31
  Speaker 2: Is that fair? No, it's not. But it's also the
• 34:36
  Speaker 2: only way that you can underwrite the current system because
• 34:39
  Speaker 2: there's no way if you had a way to discharge
• 34:43
  Speaker 2: that debt, the interest rates would be significantly higher because
• 34:46
  Speaker 2: it's not collateralized with anything, which all gets to the
• 34:51
  Speaker 2: point of the whole student loan system is completely broken
• 34:53
  Speaker 2: and we're doing everyone at disservice by doing this, But
• 34:56
  Speaker 2: there's no will to fix it because the colleges get
• 34:58
  Speaker 2: paid well, the vast majority of borrowers do end up
• 35:01
  Speaker 2: making their payments, and the ones who can't end up
• 35:03
  Speaker 2: getting screwed by it because you can never discharge the debt.
• 35:06
  Speaker 3: Yeah, and I think as we look forward here, I
• 35:09
  Speaker 3: don't really see a path for this ever getting paid off.
• 35:13
  Speaker 3: I suspect more and more people are going to die
• 35:15
  Speaker 3: with this debt because on the you know, you can
• 35:20
  Speaker 3: have your wages garnished. But the Trumpet, even the Trump
• 35:23
  Speaker 3: administration who put back into place the collections on student
• 35:27
  Speaker 3: loan debt, has made the decision that they're not going
• 35:29
  Speaker 3: to go after Social Security payments, at least for now.
• 35:32
  Speaker 3: When it comes to outstanding student loans and so.
• 35:35
  Speaker 2: Tends to play badly.
• 35:36
  Speaker 3: Yeah, I can see why, but it also points out
• 35:39
  Speaker 3: that like, okay, this is just never going.
• 35:40
  Speaker 2: To okay, So we're just gonna let a whole bunch
• 35:43
  Speaker 2: of people sit there with debt that they can never
• 35:45
  Speaker 2: pay off. What are we actually doing here?
• 35:48
  Speaker 3: Yeah, it'll it'll never be repaid, folks. We are closing
• 35:52
  Speaker 3: in on the two live events from the Financial Exchange
• 35:55
  Speaker 3: and the Armstrong Advisory Group. Obviously a lot going on,
• 35:58
  Speaker 3: including a government shut down right now, creating a bit
• 36:01
  Speaker 3: of a fog of war when it comes to this
• 36:03
  Speaker 3: moment in time that was already a bit unclear as
• 36:07
  Speaker 3: to what was happening with the labor market. We were
• 36:09
  Speaker 3: supposed to get a job's report this morning, supposed to
• 36:11
  Speaker 3: get another one tomorrow, both of which being suspended at
• 36:13
  Speaker 3: the moment. Join us for a live broadcast of the
• 36:16
  Speaker 3: Financial Exchange. The first one is going to be on
• 36:19
  Speaker 3: October ninth. Second, we'll be doing another on October sixteenth.
• 36:22
  Speaker 3: The first one is at the Margaritaville Resort on Cape
• 36:25
  Speaker 3: Cod second one at the Showcase super Lucks in Chestnut
• 36:28
  Speaker 3: Hill on October sixteenth, we're going to be doing a
• 36:31
  Speaker 3: live broadcast of the show. You can sit in and
• 36:32
  Speaker 3: watch how it's made. You can join us afterwards for
• 36:35
  Speaker 3: luncheon that a brief chat with the Armstrong Advisory Group
• 36:37
  Speaker 3: about the state of the market, about the state of
• 36:39
  Speaker 3: retirement in America today, and where we think things may
• 36:42
  Speaker 3: be going, and what it means for you to register. Again,
• 36:46
  Speaker 3: space is limited. We are selling out here October ninth
• 36:48
  Speaker 3: October sixteenth. Please make sure you register ahead of time
• 36:51
  Speaker 3: by calling eight hundred three nine three four zero zero one.
• 36:55
  Speaker 3: If you forgot the dates I just mentioned, just go
• 36:57
  Speaker 3: to Armstrong Advisory dot com. But that number again, eight
• 37:00
  Speaker 3: hundred three nine three four zero zero one.
• 37:03
  Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
• 37:05
  Speaker 1: registered investment advisor. Nothing in the ad or in any
• 37:08
  Speaker 1: Armstrong guide a specific financial, legal, or tax advice. Consult
• 37:11
  Speaker 1: your own financial, tax into state planning advisors before making
• 37:14
  Speaker 1: any investment decisions. Armstrong may contact you to offer investment
• 37:17
  Speaker 1: advisory services.
• 37:18
  Speaker 2: We are about to head into the winter heating season,
• 37:22
  Speaker 2: and for those of you listening to us in the Northeast,
• 37:27
  Speaker 2: the good news is that after a big jump last year,
• 37:31
  Speaker 2: it appears that throughout most of New England, home heating
• 37:35
  Speaker 2: rates are not going to be moving a ton if
• 37:36
  Speaker 2: you are heating with natural gas, obviously, if you're a
• 37:40
  Speaker 2: heating oil household, those are going to vary based on
• 37:42
  Speaker 2: when you have to fill up, how much you fill up,
• 37:44
  Speaker 2: are you prepaying or not. There's a whole series of
• 37:49
  Speaker 2: calculations you can do with your slide rules and everything
• 37:51
  Speaker 2: just to make sure you get it right. But for
• 37:54
  Speaker 2: net gas, it appears things are going to be roughly
• 37:56
  Speaker 2: in line with last year, which was still a big
• 37:58
  Speaker 2: jump from the prior year. If you heat with electric heat,
• 38:01
  Speaker 2: either you know heat pumps or more conventional electric heat,
• 38:04
  Speaker 2: good luck. Those are going to unfortunately be fairly high
• 38:08
  Speaker 2: because the price of electricity continues to move up. Quick
• 38:13
  Speaker 2: break here. Hour two coming up in a little bit.