Latest / The Financial Exchange Show / American Middle Class is Shrinking. Is that a good thing?

Transcript

American Middle Class is Shrinking. Is that a good thing? · The Financial Exchange Show

• 0:00
  Speaker 1: The Financial Exchange is produced by Money Matters Radio and
• 0:03
  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 Dog 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 Tucker with you here on a Thursday and
• 1:14
  Speaker 2: Busy one. At eight thirty this morning, we received the
• 1:18
  Speaker 2: jobs report for the month of September, delayed about a
• 1:21
  Speaker 2: month and a half due to the government shutdown. But
• 1:24
  Speaker 2: what we saw was a pretty good report, quite honestly,
• 1:27
  Speaker 2: one hundred and nineteen thousand jobs created, but the unemployment
• 1:31
  Speaker 2: rate did rise to four point four percent. A lot
• 1:33
  Speaker 2: of the supplemental under the hood things did show some stability.
• 1:36
  Speaker 2: So I think this is a nice bounce back report
• 1:39
  Speaker 2: after several months of weakness. Whether this becomes the start
• 1:44
  Speaker 2: of a new trend or just an outlier, we don't
• 1:46
  Speaker 2: know yet. We're gonna have to watch the next couple
• 1:48
  Speaker 2: months to see, but it was I would probably grade this, Mike,
• 1:51
  Speaker 2: what do you say, like B BB plus somewhere in
• 1:54
  Speaker 2: that range.
• 1:57
  Speaker 3: I don't know that I go B plus on it.
• 1:58
  Speaker 3: Given the unemployment, right, Chie.
• 2:00
  Speaker 4: Let's call it a B even call it B mine.
• 2:04
  Speaker 2: Some of these other ones we've talked about have been,
• 2:06
  Speaker 2: you know, in the seed to D range recently, and
• 2:08
  Speaker 2: so this is it's an improvement. Nonetheless, Also, we received
• 2:12
  Speaker 2: in video earnings after the Bell yesterday they were very
• 2:16
  Speaker 2: quite good, and the market is rewarding them, though not
• 2:19
  Speaker 2: as much as in the after hours period. They're about
• 2:21
  Speaker 2: two and a half percent now after being up about
• 2:23
  Speaker 2: five after hours yesterday. But in Vidia continuing to say, hey,
• 2:29
  Speaker 2: you want chips, we got chips.
• 2:33
  Speaker 4: That's I believe.
• 2:34
  Speaker 2: The great philosopher Jensen Huang said that several days yesterday
• 2:40
  Speaker 2: yes other things that we saw Walmart continuing to sell
• 2:44
  Speaker 2: other kinds of chips to anyone who wants them. Walmart
• 2:47
  Speaker 2: with a fantastic quarter of the stock up about six
• 2:49
  Speaker 2: percent as a result, in particular indicating they're seeing more
• 2:53
  Speaker 2: penetration in high income areas, which does raise the question
• 2:58
  Speaker 2: of okay, is that high income people train down and
• 3:01
  Speaker 2: how does that affect the overall economy. The answer so
• 3:03
  Speaker 2: far has been, well, it hasn't really. But ultimately another
• 3:07
  Speaker 2: good quarter for Walmart. Grocery store sales continuing to remain strong,
• 3:11
  Speaker 2: unlike Target which saw some weakness there, and Walmart seeing
• 3:14
  Speaker 2: much better on the discretionary purchase side of things than
• 3:17
  Speaker 2: what Target reported, and so you continue to see a
• 3:20
  Speaker 2: big divergence between where those two companies are going, as
• 3:24
  Speaker 2: well as far as the overall markets, Dow is up
• 3:27
  Speaker 2: five hundred and thirty four points right now. S and
• 3:29
  Speaker 2: P's up eighty eight, both you know, good numbers. The NASDAC,
• 3:33
  Speaker 2: by the way, about three hundred and seventy points, all good,
• 3:36
  Speaker 2: but all these also down about two thirds of a
• 3:38
  Speaker 2: percent from their morning high. So could just more. I mean, look,
• 3:44
  Speaker 2: I have no idea where markets are gonna go like
• 3:45
  Speaker 2: five hours from now, but this could be a little
• 3:48
  Speaker 2: bit of a wobble, or it could just you know,
• 3:51
  Speaker 2: be something where you know, it's you know, stocks starting
• 3:54
  Speaker 2: to give up gains after the initial burst of optimism.
• 3:58
  Speaker 4: I have absolutely no clue in either case.
• 4:00
  Speaker 5: It's a reversal of what we saw towards the end
• 4:02
  Speaker 5: of last week, in the first few days of this
• 4:04
  Speaker 5: week in terms of market action, which had been you know,
• 4:07
  Speaker 5: largely negative, not dramatically, you know, not five percent in
• 4:12
  Speaker 5: a day down, but you know, strong push downward on
• 4:15
  Speaker 5: overall indices over the course of the last week or so.
• 4:18
  Speaker 3: And this is reversing it so far this morning.
• 4:20
  Speaker 2: You want to know what is kind of interesting to
• 4:22
  Speaker 2: be looking at that equildly markets, Mike, So you get
• 4:25
  Speaker 2: a good day like this, right at least a good,
• 4:28
  Speaker 2: you know, couple hours like this, and typically this serves
• 4:32
  Speaker 2: to kind of bob the VIX on its head pretty good,
• 4:35
  Speaker 2: it has to a certain extent. We're up over you know,
• 4:37
  Speaker 2: twenty three, closing in on twenty four yesterday, but you're
• 4:42
  Speaker 2: sitting here today. The S and P's up you know,
• 4:44
  Speaker 2: one to quarter percent, and the VIX is still hanging
• 4:47
  Speaker 2: out in near twenty one.
• 4:49
  Speaker 5: Yeah, that doesn't feel great, and it has been for
• 4:52
  Speaker 5: the last few weeks.
• 4:52
  Speaker 3: Right.
• 4:53
  Speaker 2: He continues to have that vibe of like somebody knows
• 4:55
  Speaker 2: something out there and doesn't want to move on, and
• 4:59
  Speaker 2: I can't reconcile, like what's happening here because a VIX
• 5:04
  Speaker 2: over twenty like for the like in this environment, you know,
• 5:07
  Speaker 2: for the last five six years generally tells you like
• 5:11
  Speaker 2: something's getting dodgy. And usually it's say, once you get
• 5:14
  Speaker 2: to twenty five, you either like have something break and
• 5:17
  Speaker 2: you go higher into the thirties or things resolve and
• 5:20
  Speaker 2: you get back down into the teams pretty quickly. The
• 5:23
  Speaker 2: fact that we're still hitting here sitting here, We've cleared
• 5:25
  Speaker 2: Nvidio earnings, we've cleared that September job support, we've cleared
• 5:28
  Speaker 2: the backlog on jobless claims on top of which, by
• 5:32
  Speaker 2: the way, next week is Thanksgiving, which means you have
• 5:34
  Speaker 2: a day and a half where there's no trading, which
• 5:36
  Speaker 2: normally depresses the VIX anyway, since those days will fall
• 5:39
  Speaker 2: in the thirty calendar day window, and the fact that
• 5:43
  Speaker 2: you're still hit sitting here right now with VIX at
• 5:45
  Speaker 2: twenty one kind of has me like, you know, like
• 5:50
  Speaker 2: just scrache. I'm feeling something in my belly that I
• 5:54
  Speaker 2: don't know what to do with, and it doesn't feel great,
• 5:59
  Speaker 2: is what I'm saying. Let's talk about the housing market.
• 6:04
  Speaker 2: If you are a buyer for homes specifically, take the
• 6:08
  Speaker 2: map of the United States and make an l like
• 6:12
  Speaker 2: my two year old likes to where it's kind of
• 6:14
  Speaker 2: a short, little vertical thing and then a big, long,
• 6:18
  Speaker 2: horizontal one. And that's the part of the country where
• 6:22
  Speaker 2: there's great buyers markets right now. You go from Washington
• 6:25
  Speaker 2: through California, down through Arizona, and then across the southeast
• 6:28
  Speaker 2: and southwest. That is where it is a huge buyer's
• 6:32
  Speaker 2: market at the moment in general, and.
• 6:35
  Speaker 5: So according to excuse me, Redfinn, this is the strongest
• 6:39
  Speaker 5: buyer's market, meaning portion of home sellers versus buyers since
• 6:44
  Speaker 5: twenty thirteen. I don't know that that's the best way
• 6:47
  Speaker 5: to look at it, But I also measure that. I
• 6:49
  Speaker 5: mean like traffic volume, my website volume.
• 6:52
  Speaker 3: I don't know.
• 6:53
  Speaker 5: I'm not sure how useful of a data point that
• 6:55
  Speaker 5: truly is, but I it's like.
• 6:58
  Speaker 2: When stocks go down and people are like, well, it's
• 7:00
  Speaker 2: more sellers than buyers, and I remind them, no, it's
• 7:02
  Speaker 2: just the sellers and buyers matched up at a lower
• 7:04
  Speaker 2: price point. You can't have more sellers than buyers.
• 7:08
  Speaker 5: So in either case, I think we can both admit, right, like,
• 7:12
  Speaker 5: the housing market has weakened significantly, but.
• 7:16
  Speaker 3: It hasn't become a lot more affordable.
• 7:18
  Speaker 5: And so I was interested in these data points, right,
• 7:20
  Speaker 5: So like housing market today versus twenty thirteen.
• 7:23
  Speaker 3: So I ran some numbers.
• 7:25
  Speaker 5: Median home price for most recent data we have in
• 7:28
  Speaker 5: the US Q two of twenty twenty five came in
• 7:31
  Speaker 5: at just shy at four hundred eleven thousand, same time
• 7:34
  Speaker 5: period twenty thirteen, we were talking about two hundred and
• 7:36
  Speaker 5: sixty eight thousand, No huge surprise there. We were still
• 7:40
  Speaker 5: off of the Great recession. Mortgage rates now six point
• 7:45
  Speaker 5: four percent back then three point seven percent. I ran
• 7:48
  Speaker 5: out the mortgage for these median homes in twenty thirteen
• 7:52
  Speaker 5: versus now, and.
• 7:53
  Speaker 3: Your mortgage payment for now over two thousand bucks per month,
• 7:58
  Speaker 3: whereas back then just under one thousand dollars a month.
• 8:02
  Speaker 3: Seems like a huge dramatic shift.
• 8:03
  Speaker 5: But I also point out that folks hashold income today
• 8:08
  Speaker 5: or at least in twenty twenty four was about eighty
• 8:10
  Speaker 5: four thousand, back then was fifty four thousand. So your
• 8:12
  Speaker 5: percentage of your income going to your annual mortgage payment
• 8:16
  Speaker 5: today is pushing thirty percent, which is a huge number.
• 8:20
  Speaker 5: Back in twenty thirteen it was twenty two percent. Though
• 8:22
  Speaker 5: I expected that margin to be different, to be bigger,
• 8:26
  Speaker 5: given how much home prices have risen and given how
• 8:29
  Speaker 5: much mortgage rates have risen. But we are again in
• 8:33
  Speaker 5: this area here where I think the affordability piece is
• 8:37
  Speaker 5: going to slowly get better over the course of the
• 8:39
  Speaker 5: next couple of years.
• 8:40
  Speaker 2: Right the path in my opinion, and this is one
• 8:44
  Speaker 2: one that's shared by Connorsen from Bloomberg, is I don't
• 8:50
  Speaker 2: think you necessarily see a housing crash that resolves this,
• 8:54
  Speaker 2: but it's much more just that. Okay, if you have
• 8:57
  Speaker 2: a couple years, like three four years where incomes can
• 9:00
  Speaker 2: outpace home price growth by two to three percent. It
• 9:05
  Speaker 2: gets you where you need to be. Does that happen
• 9:09
  Speaker 2: or do we see a problem in the housing market? First, again,
• 9:12
  Speaker 2: when we when I say a problem in the housing market,
• 9:14
  Speaker 2: there's nothing out there in housing that looks like two
• 9:17
  Speaker 2: thousand and eight. No, there's nothing that. I mean, people
• 9:20
  Speaker 2: have been trying. Everyone's been publishing the headlines for like
• 9:23
  Speaker 2: the last couple of years, like oh for closers or
• 9:25
  Speaker 2: rising in this It's like, yeah, they're rising off historic lows.
• 9:28
  Speaker 2: There's still like well below twenty nineteen levels. There's there's
• 9:32
  Speaker 2: nothing in housing to me that looks like it's going
• 9:35
  Speaker 2: to cause any kind of broad based financial stress in
• 9:38
  Speaker 2: the system. The only place you could maybe point to
• 9:41
  Speaker 2: in housing that could be a problem is construction layoffs
• 9:44
  Speaker 2: if new construction for housing remains this light. But that's
• 9:48
  Speaker 2: not something that causes systemic issues for the whole you know,
• 9:52
  Speaker 2: for everyone in the country.
• 9:53
  Speaker 3: Right.
• 9:54
  Speaker 2: So housing, like again it's I look at and I go,
• 9:59
  Speaker 2: I don't I think it's really gonna help the economy
• 10:01
  Speaker 2: much in the next couple of years.
• 10:04
  Speaker 4: But I don't really see a path where it hurts
• 10:05
  Speaker 4: the economy a ton either.
• 10:08
  Speaker 5: Yeah, and for those that are hunting for a deal,
• 10:12
  Speaker 5: there are areas finally where you can find one, Yeah,
• 10:16
  Speaker 5: just nowhere near around.
• 10:17
  Speaker 4: Here, yes, around here being New England.
• 10:20
  Speaker 2: Where like if you want the worst places to buy
• 10:23
  Speaker 2: a house from an affordability perspective right now, Yeah, Connecticut
• 10:27
  Speaker 2: is kind of like right at the forefront. The rest
• 10:30
  Speaker 2: of New England, most in New York and Pennsylvania through Illinois,
• 10:35
  Speaker 2: even into like Minnesota, La. That whole belt there not great.
• 10:39
  Speaker 2: You get out of that region and things start to
• 10:41
  Speaker 2: look better in lots of the country, but the Northeast
• 10:44
  Speaker 2: and Upper Midwest pretty dodgy still if you are a
• 10:48
  Speaker 2: buyer to find anything affordable.
• 10:50
  Speaker 4: Let's take a quick break.
• 10:51
  Speaker 2: When we come back, we've got trivia, and then we'll
• 10:53
  Speaker 2: talk about the shrinking American middle class.
• 10:58
  Speaker 1: Here the Financial Exchange every day from eleven to noon
• 11:00
  Speaker 1: Non Serious XM's Business radio Channel one thirty two. Keep
• 11:04
  Speaker 1: it here for the latest business and financial news and
• 11:07
  Speaker 1: the trends on Wall Street. The Financial Exchange is now
• 11:10
  Speaker 1: livee on Serious XM's Business Radio Channel one thirty two.
• 11:14
  Speaker 1: Face He's the Financial Exchange Radio Network. The Financial Exchange
• 11:19
  Speaker 1: streams live on YouTube. Subscribe to our page and stay
• 11:22
  Speaker 1: up to date on breaking business news all morning. Long face,
• 11:26
  Speaker 1: He's the Financial Exchange Radio Network.
• 11:34
  Speaker 6: Hey, if you missed any of our shows this week,
• 11:36
  Speaker 6: you can find them on our YouTube page. We stream
• 11:40
  Speaker 6: the show live every day, but also archive every hour
• 11:44
  Speaker 6: and all of our most noteworthy interviews.
• 11:47
  Speaker 4: Go to YouTube.
• 11:48
  Speaker 6: Search for the Financial Exchange in that search bar and
• 11:51
  Speaker 6: hit that subscribe button again. Financial Exchange Show on YouTube.
• 11:56
  Speaker 6: Hit the subscribe button.
• 11:59
  Speaker 4: Time for sure.
• 11:59
  Speaker 6: Here the Financial Exchange and on this day in nineteen
• 12:02
  Speaker 6: eighty five, Microsoft release Windows one point zero. Windows is
• 12:06
  Speaker 6: the most popular desktop operating system in the world, with
• 12:10
  Speaker 6: the seventy two percent market share as of October twenty
• 12:13
  Speaker 6: twenty five, and the second most popular operating system overall,
• 12:17
  Speaker 6: behind Android. So Trivir question today what version of Windows
• 12:22
  Speaker 6: was released by Microsoft earlier this year? Once again, what
• 12:26
  Speaker 6: version of Windows was released by Microsoft earlier this year?
• 12:31
  Speaker 4: Be the third.
• 12:32
  Speaker 6: Person today to text us at six one seven three
• 12:34
  Speaker 6: six two thirteen eighty five with the correct answer, and
• 12:37
  Speaker 6: you win a Financial Exchange Show t shirt once again.
• 12:40
  Speaker 6: The third correct response to Texas to the number six, one, seven, three, six, two,
• 12:45
  Speaker 6: thirteen eighty five will win that T shirt. See complete
• 12:49
  Speaker 6: contest rules at Financial Exchange Show dot com.
• 12:52
  Speaker 2: Mike piece in Bloomberg Opinion, the American middle class is shrinking,
• 12:56
  Speaker 2: and that's okay, gosh, that's not a sentiment that we
• 12:59
  Speaker 2: hear often. But why is this piece saying it's fine?
• 13:02
  Speaker 5: So again, you write the article, not the headline. So
• 13:07
  Speaker 5: I'm wondering if she did both here. But here's a
• 13:10
  Speaker 5: brief summary of things in numbers. In nineteen sixty seven,
• 13:13
  Speaker 5: slightly more than five percent of Americans earned or received
• 13:16
  Speaker 5: more than one hundred and fifty thousand dollars in today's.
• 13:19
  Speaker 3: Dollars currently adjusted for adjusted for inflation.
• 13:23
  Speaker 4: Yep.
• 13:24
  Speaker 5: Yes, now more than thirty percent of people do so.
• 13:28
  Speaker 5: Her point first is, hey, a larger portion of Americans
• 13:32
  Speaker 5: make a large sum of money. In nineteen sixty seven,
• 13:36
  Speaker 5: more than thirty eight percent earned or received less than
• 13:39
  Speaker 5: fifty thousand dollars today, that's twenty one percent, So across
• 13:43
  Speaker 5: the spectrum, she's saying, Hey, the middle class is shrinking
• 13:48
  Speaker 5: in a few different ways, but not from the perspective
• 13:52
  Speaker 5: of everyone's getting worse off. The bad part of it
• 13:57
  Speaker 5: that she points out, is that the wealth inequality today
• 14:00
  Speaker 5: compared to where it was in the sixties is almost unrecognizable.
• 14:05
  Speaker 5: The very rich, the top five percent, you know, really
• 14:10
  Speaker 5: bring in way more of the income than they did
• 14:12
  Speaker 5: in nineteen sixty seven and represent a much bigger share. So, yes,
• 14:16
  Speaker 5: more people are falling on the ends of those curves
• 14:18
  Speaker 5: towards the upside, but the very top of the crop,
• 14:22
  Speaker 5: the top one percent, are bringing in a lot more
• 14:25
  Speaker 5: of the total share.
• 14:26
  Speaker 3: Of income than they were back in the sixties.
• 14:28
  Speaker 5: And so, I mean, again the subject of the article says,
• 14:32
  Speaker 5: it's not a big deal. I would point to this
• 14:34
  Speaker 5: one effect as one of the main causes of you know,
• 14:37
  Speaker 5: what we're seeing in terms of populism and you know,
• 14:40
  Speaker 5: global shifts and how people view the fairness of the economy,
• 14:44
  Speaker 5: how people view capitalism, all sorts of changes that we've
• 14:47
  Speaker 5: been seeing over the last sixty years, I think are
• 14:49
  Speaker 5: primarily attributable to this effect.
• 14:52
  Speaker 2: What do we do about this IW Like, let's let's
• 14:57
  Speaker 2: start number one. Is there something it should be done about.
• 15:02
  Speaker 5: This, about the wealth effect, about the wealth inequality effect?
• 15:07
  Speaker 2: Well, let's what is the actual problem that you're saying exists,
• 15:13
  Speaker 2: is that that top five percent is just so skewed
• 15:17
  Speaker 2: in terms of what they earn, and it allows them
• 15:20
  Speaker 2: to accumulate vast amounts of wealth, which then magnifies that
• 15:23
  Speaker 2: through compounding. Is that a fair assessment of the problem.
• 15:27
  Speaker 5: Yeah, and again I think plenty of people would debate
• 15:29
  Speaker 5: me as to whether or not that is a problem.
• 15:31
  Speaker 5: But that is a truth today that the magnitude of
• 15:36
  Speaker 5: wealth accumulated the top five percent is far higher than
• 15:40
  Speaker 5: we've seen in the last at least the last seventy
• 15:44
  Speaker 5: five years.
• 15:44
  Speaker 3: I don't, you know, go back to the nineteen twenties.
• 15:46
  Speaker 3: I'm not sure what it looked like.
• 15:49
  Speaker 2: I have a very simple and elegant framework that I
• 15:51
  Speaker 2: think could deal with this. If we think it's a problem. Okay,
• 15:57
  Speaker 2: it's two parts, and I guarantee that, like everyone listening
• 16:01
  Speaker 2: is going to hate one of the two parts, which
• 16:04
  Speaker 2: is good. Like that's how you know it's a good
• 16:05
  Speaker 2: idea is when no one likes it. Number one, get
• 16:09
  Speaker 2: rid of the federal estate tax completely. Number two, get
• 16:15
  Speaker 2: rid of these step up in cost basis that occurs
• 16:18
  Speaker 2: when someone dies. That basically removes capital gains that have recruit.
• 16:22
  Speaker 4: Over the course of their lifetime.
• 16:24
  Speaker 2: They Like, if you think about it, there's no reason
• 16:26
  Speaker 2: why your heirs, if they decide to sell something that
• 16:29
  Speaker 2: you bought, should not pay any Like why do you
• 16:33
  Speaker 2: just get out of paying capital gains tax because you die?
• 16:37
  Speaker 3: Yeah?
• 16:40
  Speaker 2: You know, Like let's say that I, as an example,
• 16:44
  Speaker 2: I bought, you know, one of the I was one
• 16:46
  Speaker 2: of the first people that you know invested in Microsoft.
• 16:49
  Speaker 4: Back before I was born.
• 16:51
  Speaker 2: And you know, the the one hundred dollars that I
• 16:54
  Speaker 2: took there is now you know, a million. And I say,
• 16:56
  Speaker 2: I can't sell this because I'm gonna have to pay
• 16:58
  Speaker 2: like two hundred thousand dollars in capital gains toxes. So
• 17:01
  Speaker 2: how can if I die and my daughters inherit it,
• 17:04
  Speaker 2: why do they not have to pay any capital gains taxes?
• 17:07
  Speaker 4: Just because I died?
• 17:10
  Speaker 2: They're grieving Chuck, Okay, they don't have to sell it
• 17:13
  Speaker 2: right away, like no one's making them sell it.
• 17:16
  Speaker 3: Yeah again, I think along with that.
• 17:19
  Speaker 2: The other piece, here's the third piece that that completes
• 17:21
  Speaker 2: the puzzle. Every single individual should have a one million
• 17:26
  Speaker 2: dollar in lifetime capital gains exemption. Ye before, because we
• 17:31
  Speaker 2: want more people to be millionaires. I want more millionaires.
• 17:35
  Speaker 2: I want every person in the country to have a
• 17:37
  Speaker 2: chance to say, hey, I made it. You know, I
• 17:40
  Speaker 2: made a million dollars and you know in selling this
• 17:42
  Speaker 2: business or buying this stock or doing this, and I
• 17:45
  Speaker 2: get to keep that. But once you've done that, then
• 17:49
  Speaker 2: capital games should be taxed the same way that ordinary
• 17:51
  Speaker 2: income is, because it's something where you want to give
• 17:55
  Speaker 2: everyone a chance to make that that million, so they have,
• 17:57
  Speaker 2: you know, that that that capital that they can and then.
• 18:00
  Speaker 4: Use for life. But after that, let's treat everyone the same.
• 18:04
  Speaker 5: I would say a huge contributor to this effect has
• 18:11
  Speaker 5: been our policies over the last fifty years.
• 18:13
  Speaker 3: When it comes to monopolies.
• 18:15
  Speaker 5: We have been, for whatever reason, just worse at breaking
• 18:19
  Speaker 5: up big companies than we were in previous decades. And
• 18:23
  Speaker 5: I think that is a huge contributing factor to this effect.
• 18:28
  Speaker 4: Yeah, I think that's fair.
• 18:30
  Speaker 5: The Amazons, the Googles, the facebooks, and by the way,
• 18:33
  Speaker 5: you know two of those three companies just one antitrust
• 18:36
  Speaker 5: lawsuits about breaking them up. So I don't think this
• 18:39
  Speaker 5: is about to shift anytime soon. But I think we
• 18:41
  Speaker 5: are doing a disservice to the general public by letting
• 18:44
  Speaker 5: these companies get so big and dominant. That they control
• 18:48
  Speaker 5: huge aspects.
• 18:49
  Speaker 3: Of our lives.
• 18:49
  Speaker 2: Anytime that you want to talk about, you know, more
• 18:51
  Speaker 2: effective anti trust enforcement.
• 18:53
  Speaker 4: I'm always all ears. Yeah.
• 18:55
  Speaker 2: It's one of my great flaws is that when I
• 18:58
  Speaker 2: hear someone talking about, hey, company have gotten too big,
• 19:01
  Speaker 2: I'll basically always agree with you.
• 19:04
  Speaker 6: You know.
• 19:05
  Speaker 2: It's just kind of how I'm wired at this at
• 19:08
  Speaker 2: this point.
• 19:08
  Speaker 5: But again, I think when you see surprising election results
• 19:12
  Speaker 5: like you just did in New York City, or results
• 19:15
  Speaker 5: that surprise some people anyway, I look at this as
• 19:17
  Speaker 5: being a big contributing factor too, because people are doubting
• 19:20
  Speaker 5: the system that has worked in the United States for
• 19:23
  Speaker 5: a couple hundred years.
• 19:24
  Speaker 4: Quick Break when we come back, we get the trivia
• 19:26
  Speaker 4: answer at Wall Street.
• 19:27
  Speaker 1: Watch, bringing the latest financial news straight to your radio
• 19:42
  Speaker 1: every day. It's the Financial Exchange on the Financial Exchange
• 19:46
  Speaker 1: Radio Network.
• 19:49
  Speaker 7: We're proud to announce that circle K is now the
• 19:51
  Speaker 7: official convenience store of the dav Department of Massachusetts. At
• 19:55
  Speaker 7: circle K, supporting those who bravely served our country isn't
• 19:58
  Speaker 7: just a commitment, it's a hard mission. Circle K is
• 20:01
  Speaker 7: honored to stand with the dav Department of Massachusetts to
• 20:04
  Speaker 7: ensure that veterans receive the care and recognition they deserve.
• 20:08
  Speaker 7: If you'd like to do your part, please visit DAVMA
• 20:11
  Speaker 7: dot org. Thank you for standing with circle K and
• 20:13
  Speaker 7: the dav Department of Massachusetts, and thank you veterans for
• 20:16
  Speaker 7: all you've done.
• 20:19
  Speaker 1: Time now for Wall Street. Watch a complete look at
• 20:23
  Speaker 1: what's moving markets so far today right here on the
• 20:26
  Speaker 1: Financial Exchange Radio Network.
• 20:28
  Speaker 6: Well after a strong rally in early trading, markets now
• 20:32
  Speaker 6: giving back some of their gains as traders react to
• 20:35
  Speaker 6: strong earnings in revenue forecasts from Nvidia and Walmart. The
• 20:38
  Speaker 6: delayed September jobs report also came in this morning above
• 20:42
  Speaker 6: forecasts where one hundred and nineteen thousand jobs were added
• 20:47
  Speaker 6: in September, higher than estimates of fifty one thousand. Right now,
• 20:52
  Speaker 6: the Dow is up six tenths of a percent. Ers
• 20:54
  Speaker 6: two hundred and seventy four points. SMP five hundred also
• 20:58
  Speaker 6: up about six tenths of a percent, cent of forty
• 21:00
  Speaker 6: three points higher. NASDAC up eight tenths of one percent.
• 21:03
  Speaker 6: It was up over two percent higher earlier, now up
• 21:07
  Speaker 6: one hundred and seventy nine points. RUSSED two thousand is
• 21:09
  Speaker 6: up over one percent. Ten your treasureeled down two basis
• 21:12
  Speaker 6: points at four point one zero two percent, and crude
• 21:16
  Speaker 6: oil up about six tens of a percent, trading just
• 21:18
  Speaker 6: below sixty dollars a barrel. And video shares are up
• 21:22
  Speaker 6: nearly two percent after the AI chip maker saw its
• 21:25
  Speaker 6: revenue searched sixty two percent year on year and issued
• 21:28
  Speaker 6: stronger than expected fourth quarter sales guidance. Meanwhile, the country's
• 21:32
  Speaker 6: biggest retailer and Walmart, posted solid quarterly results and raised
• 21:36
  Speaker 6: its outlook. Walmart also reported a four and a half
• 21:39
  Speaker 6: percent increasing comparable sales in the US during the quarter,
• 21:43
  Speaker 6: driven by consumers seeking value. Walmart is up over six
• 21:47
  Speaker 6: percent Elsewhere Verizon and Now so We'll cut more than
• 21:50
  Speaker 6: thirteen thousand jobs and its largest single layoff as it
• 21:53
  Speaker 6: works to reduce costs and restructure operations. Shares are up
• 21:57
  Speaker 6: modestly and shares in bath and body work are sinking
• 22:01
  Speaker 6: twenty three percent after the self care and home products
• 22:04
  Speaker 6: retailer posted third quarter results that underwhelmed, where it posted
• 22:08
  Speaker 6: a drop in quarterly net sales and income. The company
• 22:11
  Speaker 6: also slashed its annual forecast. I'm Tucker Silva and that
• 22:16
  Speaker 6: is Wall Street Watch and in the previous segment, we
• 22:18
  Speaker 6: asked you the question what version of Windows was released
• 22:23
  Speaker 6: by Microsoft earlier this year? That would be Windows eleven.
• 22:27
  Speaker 6: Pete from Wooster is our winner today taking on a
• 22:30
  Speaker 6: Financial Looks Change Show t shirt and we played trivia
• 22:33
  Speaker 6: every day here in the Financial Looks Change. See complete
• 22:35
  Speaker 6: contest rules at Financial Looks chainshow dot Com.
• 22:39
  Speaker 4: I think they should rebrand Windows.
• 22:42
  Speaker 3: Now.
• 22:43
  Speaker 4: I don't true, It's fine.
• 22:47
  Speaker 3: It's been a few decades now, pretty so solid brand.
• 22:50
  Speaker 2: Stick with it no matter what they call it. People
• 22:52
  Speaker 2: are gonna be stuck with it.
• 22:54
  Speaker 3: Windows plus Doors.
• 22:59
  Speaker 4: Thank you. Mike.
• 23:00
  Speaker 2: By the way, have you noticed that the S and
• 23:02
  Speaker 2: P is now ninety points off it's intra day high?
• 23:04
  Speaker 3: I have noticed that.
• 23:05
  Speaker 5: Yeah, Nasdaq was up over two percent, it's now up
• 23:08
  Speaker 5: two thirds of a percent.
• 23:09
  Speaker 4: Yeah. I don't know what to make of this, but.
• 23:13
  Speaker 3: Speaks that vix you're seeing earlier.
• 23:14
  Speaker 2: I mean, Oracle's down two percent on the day now, Yeah,
• 23:18
  Speaker 2: AMD's down one and a half. Netflix in video, which
• 23:22
  Speaker 2: Tucker just mentioned, just fell half a percent in the
• 23:24
  Speaker 2: last minute.
• 23:25
  Speaker 4: Yeah, what's going on? I don't know. I don't know.
• 23:28
  Speaker 2: I can't make catcher tails out of it, but I
• 23:31
  Speaker 2: can't get past this nagging feeling that for whatever reason,
• 23:35
  Speaker 2: the bitcoin tail is wagging the dog in tech markets
• 23:39
  Speaker 2: right now, because every time it gets hammered, tech follows
• 23:41
  Speaker 2: in pretty short order. And I don't know what to
• 23:44
  Speaker 2: make of this, but it's kind of nasty out there.
• 23:49
  Speaker 2: I was talking about Blue Owl piece in Bloomberg Blue
• 23:52
  Speaker 2: Owl money machine sputters in face of private credit cracks. Michael,
• 23:56
  Speaker 2: where do I get a money machine?
• 23:58
  Speaker 5: This has been pretty ugly for Blue Eye, just in
• 24:00
  Speaker 5: terms of I mean again, for a company that nobody
• 24:03
  Speaker 5: talked about until a year ago, the kind of pr
• 24:08
  Speaker 5: that they've been getting over the last couple of weeks
• 24:10
  Speaker 5: has been fascinating. So again, if you are just tuning
• 24:14
  Speaker 5: into this program, you may not have heard of Blue Owl.
• 24:17
  Speaker 5: They are a major player in the private credit lending space.
• 24:21
  Speaker 5: They make all sorts of loans all sorts of businesses,
• 24:24
  Speaker 5: and then package those loans into investable products. Some are
• 24:27
  Speaker 5: privately held, some are publicly traded. One of the privately
• 24:30
  Speaker 5: held ones. Some were redemptions than they were prepared to handle,
• 24:34
  Speaker 5: and so they paused all redemptions on this fund.
• 24:37
  Speaker 2: By the way, their business has exploded in a positive
• 24:41
  Speaker 2: use of the term in the last several years. In
• 24:44
  Speaker 2: March of twenty one, their trailing twelve month revenue was
• 24:46
  Speaker 2: about three hundred million. As of their most recent quarter
• 24:50
  Speaker 2: that ended in September, they were at two point seventy
• 24:52
  Speaker 2: five billion, so nine x revenue growth in the last
• 24:56
  Speaker 2: four years.
• 24:57
  Speaker 5: So what happened over the course of the last week
• 24:59
  Speaker 5: or so was that they tried to take this private
• 25:01
  Speaker 5: fund merger with a publicly traded fund that would have
• 25:04
  Speaker 5: resulted in a haircut for investors in that fund, but
• 25:08
  Speaker 5: give them access to liquidity, and markets kind of revolted
• 25:13
  Speaker 5: on the stock itself and everything along with it. What
• 25:18
  Speaker 5: I keep going back to, though, Chuck, is there's been
• 25:20
  Speaker 5: a bunch of blow ups in the private credit space.
• 25:23
  Speaker 3: Has Blue Owl been named in any of them?
• 25:27
  Speaker 4: No?
• 25:28
  Speaker 5: Right, Like me, it's not to say that they don't
• 25:30
  Speaker 5: have problems of their own. They're a massive player here.
• 25:32
  Speaker 5: But when I think about the blowups that we've been
• 25:35
  Speaker 5: talking about, none of them have really concerned Blue Owl
• 25:39
  Speaker 5: or their space in this overall market right now.
• 25:43
  Speaker 2: No, I mean it's been a small number to this point. True,
• 25:46
  Speaker 2: And again the concern is that, like my personal concern,
• 25:50
  Speaker 2: I'm not saying this will or won't happen. But in
• 25:55
  Speaker 2: spring and summer of two thousand and seven, you started
• 25:59
  Speaker 2: seeing like some sporadic issues with subprime in the housing market.
• 26:04
  Speaker 2: And it wasn't like no one was like, oh, like,
• 26:07
  Speaker 2: this is affecting everyone. It was just, oh, it must
• 26:09
  Speaker 2: just be like this product or this one. And within
• 26:13
  Speaker 2: a year it was like, no, like it's kind of everywhere.
• 26:16
  Speaker 2: And then six months after that it was hey, bailouts.
• 26:19
  Speaker 3: Yeah.
• 26:20
  Speaker 2: And so the concern that you have on this is
• 26:25
  Speaker 2: kind of threefold. The first is, no one knows how
• 26:27
  Speaker 2: big the private credit industry actually is. It's private, that's
• 26:31
  Speaker 2: the very nature of it. These are not loans that
• 26:33
  Speaker 2: are traded, you know, on publicly traded in disease. No
• 26:37
  Speaker 2: one knows how big this actually is. Number two, no
• 26:42
  Speaker 2: one knows how widespread the problems that are starting to
• 26:45
  Speaker 2: pop up are. We don't know if this is point
• 26:47
  Speaker 2: zero zero one percent of loans that have these issues
• 26:50
  Speaker 2: point one percent or one percent, and there's a big
• 26:54
  Speaker 2: difference between those orders of magnitude. And the third piece,
• 26:58
  Speaker 2: then is the combination, which is okay, depending on how
• 27:02
  Speaker 2: big the overall private credit market is and what percentage
• 27:05
  Speaker 2: of loans have problems. You get to a place where
• 27:08
  Speaker 2: it could be very problematic for the overall US economy
• 27:12
  Speaker 2: or it could mean nothing, and no one knows right now.
• 27:15
  Speaker 3: Yeah, it's pretty opique.
• 27:17
  Speaker 2: It's it's and quite honestly, this is because we've pushed
• 27:21
  Speaker 2: so much of this lending into these areas and away
• 27:23
  Speaker 2: from banks and public markets that we can't see it.
• 27:27
  Speaker 2: This whole non bank lending thing is going to come
• 27:30
  Speaker 2: back to bite us. And this might be it. I
• 27:33
  Speaker 2: don't know, but it might be. Like it's whenever you
• 27:37
  Speaker 2: take stuff out of you know, the public eye, you're
• 27:41
  Speaker 2: you're taking risks that are you know, the visibility into
• 27:46
  Speaker 2: this stuff is a real problem when you're trying to
• 27:50
  Speaker 2: navigate it and it doesn't feel great.
• 27:53
  Speaker 6: The US Virgin Islands isn't just a postcard. It's alive
• 27:56
  Speaker 6: with rhythm, culture and celebration. This December through early January,
• 28:00
  Speaker 6: Saint Croix lights up with the Crucian Christmas Festival. I
• 28:04
  Speaker 6: heard his carnival tradition dating back to the eighteen hundreds.
• 28:07
  Speaker 6: There are incredible parades through Frederick Stead as the festival
• 28:11
  Speaker 6: village buzzes with live music, reggae and soca and local
• 28:14
  Speaker 6: island beats, as well as streets filled with the scent
• 28:17
  Speaker 6: of authentic Caribbean flavors. Beyond the festival, there's Saint Thomas,
• 28:22
  Speaker 6: fresh with cruise hub energy, duty free shopping and panoramic views.
• 28:25
  Speaker 6: At Megan's Bay, Saint John is quiet, wild and pure,
• 28:29
  Speaker 6: where every trail in beach is its own adventure. Explore
• 28:33
  Speaker 6: one island or all three each offer something unique, all
• 28:37
  Speaker 6: with warm hospitality in that easy island vibe. Travel from
• 28:40
  Speaker 6: New England could not be easier. There's no passpord needed
• 28:44
  Speaker 6: and no money to exchange. This holiday season, plane your
• 28:48
  Speaker 6: escape and fall naturally in rhythm with the heartbeat of
• 28:50
  Speaker 6: the islands. Visit USVII dot com and book your trip today.
• 28:54
  Speaker 6: That's visit USVII dot com.
• 28:58
  Speaker 4: Mike, We've got peace in Bloomberg.
• 29:00
  Speaker 2: Buffett's alphabet blessing puts valuation paradox back in focus. Uh
• 29:05
  Speaker 2: and basically paradox.
• 29:08
  Speaker 3: Or is it just the fact that google stock is
• 29:10
  Speaker 3: really expensive?
• 29:12
  Speaker 2: Google Stock's really expensive, and Buffet's not running the show
• 29:15
  Speaker 2: at Berkshire anymore, And so I think those two things
• 29:18
  Speaker 2: can be just fine.
• 29:20
  Speaker 5: Yeah, I mean, look for anybody that missed it, I
• 29:23
  Speaker 5: know that Alphabet hasn't been the number one company mentioned
• 29:25
  Speaker 5: when we're talking about the AI trade, but they have
• 29:27
  Speaker 5: been the number one beneficiary of the AI trade. And
• 29:30
  Speaker 5: you look at how they're positioned. They are starting to
• 29:33
  Speaker 5: make their own chips, they have their own competing AI tool,
• 29:36
  Speaker 5: and then they also have correct me if I'm wrong, Chuck,
• 29:40
  Speaker 5: the most profitable business in history.
• 29:42
  Speaker 2: Yeah, we got to talk a little bit about their
• 29:46
  Speaker 2: naming of these products.
• 29:49
  Speaker 3: Did you see the image generator of that?
• 29:51
  Speaker 4: I did Nana Banana Pro.
• 29:52
  Speaker 3: I think it's no Banana Pro.
• 29:55
  Speaker 2: Yeah, oh, the original the original thing that came across
• 29:58
  Speaker 2: my ticker was Nana Banana Pro.
• 30:00
  Speaker 3: I'm like, oh, like your grandma, right.
• 30:04
  Speaker 2: And then their developer tool kit is now Gemini Anti Gravity.
• 30:09
  Speaker 4: I don't know what these things mean.
• 30:11
  Speaker 3: Yeah, I don't know why Banana's in there.
• 30:14
  Speaker 4: Nano Banana Pro.
• 30:15
  Speaker 2: Yeah, I'd prefer Nano Banana amateur personally. Mmm, you know,
• 30:20
  Speaker 2: I don't think I'm skilled enough to use the professional
• 30:23
  Speaker 2: tools of graphic design, but uh.
• 30:25
  Speaker 4: Yeah, look, I think.
• 30:28
  Speaker 3: Google.
• 30:28
  Speaker 2: The big thing that I will say about them is
• 30:31
  Speaker 2: they do appear to be doing some innovative things on
• 30:34
  Speaker 2: the AI side right now. Sure, their core business, while unexciting,
• 30:38
  Speaker 2: continues to deliver. And even though I've been pretty critical
• 30:42
  Speaker 2: of Google for the last like five or six years,
• 30:43
  Speaker 2: being like, hey, what are you guys doing that's interesting?
• 30:46
  Speaker 4: I think the ai stuff is interesting.
• 30:48
  Speaker 2: Enough now that you know, there might be a lot
• 30:51
  Speaker 2: of people after this really saying that open ai is
• 30:53
  Speaker 2: kind of left behind, quite honestly, which is interesting to me.
• 30:56
  Speaker 2: And these are people that I trust on this, and
• 30:58
  Speaker 2: some people saying it's like, look, it might be like
• 31:01
  Speaker 2: Gemini anthropic and then open ai and now everyone's tethered
• 31:05
  Speaker 2: to open Ai, which is kind of like not great.
• 31:08
  Speaker 2: But the other thing with Google that I do think
• 31:10
  Speaker 2: you have to come back to that people forget about.
• 31:12
  Speaker 2: They are the leaders in the driverless taxi market right now.
• 31:15
  Speaker 3: Yeah with way Moo. If that ends up being a
• 31:17
  Speaker 3: real thing, then they are the leaders.
• 31:19
  Speaker 2: They announced a big expansion to a bunch of other
• 31:22
  Speaker 2: cities next year a couple days ago. So yeah, maybe
• 31:27
  Speaker 2: I'm the worm is turning in my talk. Yeah, yeah,
• 31:32
  Speaker 2: let's take a quick break when we come back, Let's
• 31:34
  Speaker 2: do a little bit of stack roulette.
• 31:36
  Speaker 1: Finding daily interviews and full shows of the Financial Exchange
• 31:39
  Speaker 1: on our YouTube page. Subscribe to our page and get
• 31:42
  Speaker 1: caught up on anything and everything you might have missed.
• 31:45
  Speaker 1: This is the Financial Exchange Radio Network. The Financial Exchange
• 31:52
  Speaker 1: is life on Series XM's Business radio channel one thirty
• 31:55
  Speaker 1: two week days from eleven to noon. Get the latest
• 31:58
  Speaker 1: business and financial news from across the country and around
• 32:01
  Speaker 1: the world, and keep up to date on how it
• 32:03
  Speaker 1: might affect your wallet. That's the Financial Exchange weekdays from
• 32:07
  Speaker 1: eleven to noon on Series XM's Business radio channel one
• 32:10
  Speaker 1: thirty two. Face He's the Financial Exchange Radio Network.
• 32:19
  Speaker 6: This segment of the Financial Exchange is powered by circle
• 32:22
  Speaker 6: K Convenience Stores. Circle K is now the official convenience
• 32:26
  Speaker 6: store of the Davy Department of Massachusetts. On behalf of
• 32:30
  Speaker 6: circle K, Thank you veterans for all you've done.
• 32:34
  Speaker 4: Mike, what do you got for me for stack Roulette?
• 32:37
  Speaker 5: I've got the Wall Street Journal reporting that teens are
• 32:40
  Speaker 5: seeking mental health help from AI chatbots. Experts say that
• 32:45
  Speaker 5: that's dangerous, which no kidding.
• 32:49
  Speaker 4: But tis dangerous.
• 32:52
  Speaker 5: Everybody says that that's a stupid idea, I think, but
• 32:55
  Speaker 5: I'm not surprised either.
• 32:57
  Speaker 3: I think I talked about this back in September.
• 33:01
  Speaker 5: I had been at a conference and talking to a
• 33:03
  Speaker 5: few people who had kids that are older than mine
• 33:06
  Speaker 5: and them speaking to the fact that, yeah, like our
• 33:08
  Speaker 5: kids wake up open chat GPT and asking questions that
• 33:13
  Speaker 5: I feel like they shouldn't be asking, like what should.
• 33:15
  Speaker 3: I do with my day?
• 33:17
  Speaker 5: Like questions that chat GPT should have no context for
• 33:22
  Speaker 5: how to answer, and are engaging with it in ways
• 33:26
  Speaker 5: that I just find completely confusing. And so I can't
• 33:30
  Speaker 5: be surprised that they're now engaging it for when they
• 33:33
  Speaker 5: feel bad about themselves or have questions about.
• 33:38
  Speaker 3: Their lives.
• 33:39
  Speaker 5: And the only thing that I can think of that
• 33:42
  Speaker 5: would be dumber would be asking, like a Facebook group
• 33:47
  Speaker 5: about how you look.
• 33:48
  Speaker 4: Right.
• 33:48
  Speaker 5: I just think about how bad social media is, and
• 33:52
  Speaker 5: this as a general idea seems more damaging to young
• 33:57
  Speaker 5: people than engaging with social media.
• 34:01
  Speaker 2: Yeah, I mean, I would say, I'd say there's like
• 34:06
  Speaker 2: a five percent chunk of me that thinks that we
• 34:09
  Speaker 2: should just find the off switch for the Internet and
• 34:11
  Speaker 2: hit it.
• 34:14
  Speaker 4: I'm at fifteen percent, Like it's I'm just not convinced
• 34:18
  Speaker 4: that we can handle it.
• 34:20
  Speaker 2: Anxiety, No, not ready, you know, it just seems like
• 34:23
  Speaker 2: something where it's like, hey, come back in another thousand years,
• 34:26
  Speaker 2: and give.
• 34:27
  Speaker 4: It a go thousand years.
• 34:29
  Speaker 2: Yeah, you know, I'm just not sure that we're good
• 34:32
  Speaker 2: at interneting. Nope, And it's the evidence is piling up
• 34:37
  Speaker 2: that we're pretty bad at it. Yeah, it's just it's
• 34:43
  Speaker 2: it's I don't think that we are capable of wielding
• 34:48
  Speaker 2: these tools successfully.
• 34:50
  Speaker 3: Yeah.
• 34:51
  Speaker 5: The uh, the concerns again, who knows what the reaction
• 35:00
  Speaker 5: you know, the results to young people are going to
• 35:02
  Speaker 5: be twenty years from now. But like we have study
• 35:05
  Speaker 5: after study of what happened to young people when they
• 35:08
  Speaker 5: engaged thoroughly with social media when their brains were still developing,
• 35:13
  Speaker 5: and the answers were really bad, And so I just
• 35:16
  Speaker 5: ask parents, like the goodness.
• 35:18
  Speaker 2: We're using less of it now. True, the data is
• 35:21
  Speaker 2: starting to show that turn, especially with young users.
• 35:23
  Speaker 5: Yes, because they're instead spending all their time on AI
• 35:26
  Speaker 5: chatbots maybe.
• 35:28
  Speaker 2: And like this also then gets us to a probably
• 35:32
  Speaker 2: the scariest AI report that I saw that came out
• 35:35
  Speaker 2: yesterday from four or four media that there is a
• 35:40
  Speaker 2: u in ai image creation platform and erotic roleplay chatbot
• 35:47
  Speaker 2: that apparently was hacked or somehow left like a bunch
• 35:50
  Speaker 2: of stuff unprotected in its database. And basically what they
• 35:53
  Speaker 2: found out was that everyone was taking like pictures of
• 35:56
  Speaker 2: people in there, like in their personal lives and getting
• 36:03
  Speaker 2: this to generate AI images of them like naked and stuff.
• 36:07
  Speaker 5: With probably no safeguards around, no age or any other
• 36:10
  Speaker 5: thing like.
• 36:11
  Speaker 2: No, and like it was basically anyone from like public
• 36:13
  Speaker 2: figures to people in their own lives and pretty much like.
• 36:19
  Speaker 4: This should not be allowed to exist.
• 36:21
  Speaker 2: Like most of the time, I'm like, okay, like find
• 36:23
  Speaker 2: a way that you should like regulate it so that
• 36:25
  Speaker 2: it can be used like safely. Quite honestly, this should
• 36:29
  Speaker 2: not be allowed to exist.
• 36:32
  Speaker 4: There is no using artificial for doing this.
• 36:37
  Speaker 5: Using artificial intelligence for this purpose should just be.
• 36:41
  Speaker 3: Banned and straightforward and no question about it.
• 36:44
  Speaker 2: Like the laws on the book should basically be like, hey,
• 36:48
  Speaker 2: if you are caught doing this, the penalties are significant
• 36:53
  Speaker 2: because you know what, he.
• 36:54
  Speaker 3: Has a problem.
• 36:56
  Speaker 5: And don't get me wrong, I I you can absolutely
• 37:03
  Speaker 5: see the little teenage boy who is going to do
• 37:06
  Speaker 5: this out of a relatively innocent place and not ruin
• 37:12
  Speaker 5: somebody's ruin somebody's life.
• 37:15
  Speaker 2: Yes, And I'm not saying like send that boy to
• 37:18
  Speaker 2: jail forever, but I'm saying that the companies that try
• 37:21
  Speaker 2: to offer.
• 37:22
  Speaker 4: These services should not be allowed to exist. The downside
• 37:28
  Speaker 4: is far greater than the upside.
• 37:30
  Speaker 5: Yeah, yeah, how much advertising revenue can you really pull
• 37:33
  Speaker 5: off of something like this?
• 37:34
  Speaker 3: Good God?
• 37:36
  Speaker 4: So yeah, it's good luck of parents again.
• 37:38
  Speaker 3: This is why good luck grandparents.
• 37:40
  Speaker 4: This is why the portion of.
• 37:41
  Speaker 2: Me that continues to think the Internet might just have
• 37:44
  Speaker 2: to like go away is growing.
• 37:46
  Speaker 5: Chuck, we would usually just spend the last ten seconds
• 37:49
  Speaker 5: of the show talking about markets. We need to spend
• 37:51
  Speaker 5: the last forty seconds negative.
• 37:54
  Speaker 3: Holy cow, the NASDAK is now down.
• 37:56
  Speaker 4: It takes down half a percent.
• 37:58
  Speaker 6: What the hell happened?
• 38:01
  Speaker 5: Yeah, this market just took a massive swing on in
• 38:04
  Speaker 5: video earnings that were fantastic, and we started the day
• 38:08
  Speaker 5: up two percent. NASDAC now down nearly a quarter of
• 38:13
  Speaker 5: a percent two hours later.
• 38:17
  Speaker 4: This is wild.
• 38:18
  Speaker 5: This is a very big swing for markets in video
• 38:22
  Speaker 5: earnings were fantastic, they were apparently not enough.
• 38:25
  Speaker 4: Like this is a two percent intra day swing on
• 38:27
  Speaker 4: the S and P.
• 38:28
  Speaker 3: It's a big, big move.
• 38:31
  Speaker 2: Well, I guess we're gonna have something to talk about
• 38:34
  Speaker 2: yesterday tomorrow, which is in.
• 38:36
  Speaker 3: Video stock now off half percent.
• 38:38
  Speaker 2: What happens in the next four hours of trading because
• 38:41
  Speaker 2: I have no idea where we are going. Let's take
• 38:44
  Speaker 2: a quick break for the rest of the day. Tomorrow
• 38:46
  Speaker 2: we'll try to finish.
• 38:47
  Speaker 4: Up the week. Well, we will finish up the week
• 38:49
  Speaker 2: And we hope you're along for the ride.