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Does Warren Buffett know something that we don't? · The Financial Exchange Show

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Veterans Development Corporation. This is the Financial Exchange with Chuck
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Speaker 2: Kicking off hour two of the Financial Exchange at the moment,
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and we got some movement in equity markets to the upside.
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Speaker 1: Here.
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Speaker 2: The DOWS up three hundred and ninety one points almost
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one percent, the S and P up about a quarter percent,
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sixteen points, and the NASDAC pretty much flat up eight points.
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So a little bit of a divergence here, and you're
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seeing again you take a look at the areas of
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the market that are performing strongest today. You got financials,
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energy industrials, that whole cyclical story continuing to rally today.
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The Nasdaq actually just turned negative here. Tenuere US Treasury
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not trading today. Bond markets closed because it's a bank
1:54
holiday in observance of Veterans Day, and so the US
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ten year Treasury is not moving. But it's just because, well,
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the bond market is closed today. To those wondering why
2:08
the bond market closes on bank holidays but stocks don't,
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the reason is if you think about what banks do,
2:15
they lend and they borrow, that's exactly what the bond
2:19
market does. So you don't want to have banks closed
2:22
while the value of their underlying loans is trading on
2:25
an open market, because it doesn't allow them to set
2:27
their books up how they want, and so that is
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why the bond market is closed today. The more you know,
2:32
there you go. Oil. We've got West Texas Intermediate down
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two dollars and twenty one cents a barrel to sixty
2:38
eight seventeen, triple a national average for gas prices sliding
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another two tenths of a cent down to three h
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eight and three tenths. And we've got gold today down
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seventy four dollars and forty cents an ounce to twenty
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six twenty and forty cents. Mike, there is a piece
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in the Wall Street Journal today. It's titled does Warren
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Buffett know something that we don't?
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Speaker 3: Undoubtedly yes is yes, because he's almost eight years old,
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has made billions of dollars in his life, and drinks
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a ton of diet coke every day, so he certainly
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knows something that we don't, probably a whole lot.
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Speaker 2: Of something, quite honestly. But what this piece is specifically
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asking is hey, Berkshire Hathaway, and you know which is
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Warren Buffett's company. He says that, you know, he's kind
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of starting to not be as active, and he's got
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some lieutenants that are taking over a more active role.
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But still his company, Berkshire Hathaway is really growing its
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cash pile right now. It's got three hundred and twenty
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five billion dollars sitting in cash and cash equivalents at
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the moment.
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Speaker 3: And selling off some applestock been selling off some uh
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it was a Bank of America. They are backed at
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it for a while now. And here is the point
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that I will make. It is always impossible to tell
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whether this is because of some big overarching concern that
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Warren Buffett has about the state of the markets, if
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it is entirely based on something else. For let's talk
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about just you know, Berkshire Hathaway for a moment. Here
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they own and operate dozens, if not hundreds of businesses
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across the country, and so they wholly own some of
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them like Dairy Queen. I think, is Geico a holy
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owned subsidiary of Berkshire Hathaway is?
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Speaker 2: Well, can we go through just the wide range of
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things they own, So just on the insurance side, they've
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got Geico General Reinsurance, National Idemity Company, Netherlands Reinsurance Group
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I translated that from the original Dutch and Berkshire Hathaway Assurance.
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Then they've got a whole utilities group that owns you know,
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five or six other companies. They own Forest River Incorporated,
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the world's largest seller of r v's. Like again, these
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businesses are just all over the place. They Let's see,
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they own through of the Loom, garrand Russell Corporation for
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building products. They don't acme building brands. I'm just going
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through some of these here. Let's see what else they have.
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They got Jordan's Furniture if you live in New England,
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have ever bought anything at Jordan's. Berkshire Hathaway owns them.
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They also want Nebraska Furniture Mark, just because you know,
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they got to geographically diversify. I guess sees Candy Dairy Queen.
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As you mentioned, they own a bunch of different car dealerships.
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At this point. They have Berkshire Hathaway Realty that they own.
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I mean, it's all kinds of stuff in different industries.
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Speaker 3: I guess one point that I would have would be
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I bet that somebody over at Berkshire Hathway has a
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pretty good model for Hey, based on how these businesses
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are behaving and performing at any one point in time,
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we've got this read or that read on the state
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of the economy. But just because Warren Buffet is selling
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applestock and bag of America stock does not in and
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of itself mean that he is concerned about a big
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sell off, or that he is reading anything, or that
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Berkshire Hathaway is reading anything into this market long term.
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Speaker 2: Yeah, I think Look, here's the thing with Berkshire Hathaway.
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It's not worth trying to figure out why they're doing
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something because they they have their own businesses they're running internally.
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It's not just about hey, do we want to invest
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in this company or invest in that they might need
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the capital for something else.
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Speaker 3: Yeah, are you selling Apple because you're worried about their
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business model? If you're are you concerned about their valuations
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or are you just considering a big acquisition and need
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to free up some cash for it?
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Speaker 2: And beyond that, the other thing, you have no idea
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what their time horizon is. You can almost guarantee it's
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longer than you. It's it's probably longer than yours. Yeah,
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I'm guessing their time horizon is somewhere in the vicinity
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of fifty to one hundred years. Yes, And that works
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for them because they don't need the money. They've got
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plenty of it. And so if they to go out
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and buy I don't know a company that makes I beams,
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you'd be like, oh, does that mean they think that
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like construction is gonna pick up next year, when in
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reality they might be like, no, we think that this
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is you know, hedging for you know, commercial space stations
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that are gonna be built in the twenty fifties, and
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we want to, you know, get in on the technology
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now because we're gonna be launching I beams into space. Right,
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I'm not it could be anything. It's it's just you
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don't know why they're doing it. And the other thing
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they're not gonna tell you when they change their mind.
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All that will happen. Each quarter you'll read what they
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bought and sold and you'd be like, oh, they sold that.
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Should I have done? I have no idea. It's a
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horrible way to try to go about it. Right, So
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we get these pieces that come out because look, it
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is interesting, you know, worries.
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Speaker 3: The You cannot make a successful case for any investor
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having been better at it than Warren Buffett.
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Speaker 2: But this is equivalent to Tom Brady showing up to
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training camp and being like, oh I did X, Y
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and Z this off season. And if you're, you know,
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an aspiring quarterback, you're like, well should I be doing? No,
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You're not Tom.
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Speaker 3: Brady, You're Mike Armstrong right through like a seven year
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old girl. You got to stand stop, You got to
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stand on your tiptoes just to be able to see
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the butt of the offensive lineman, let alone over them.
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Speaker 2: Yeah. Yeah, So I just think, hey, it's it's interesting
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to see what investing greats or greats in any industry
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or any you know, any enterprise do, But that doesn't
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mean that you should be doing the same thing. Important distinction,
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and I think that that's important. So, you know, think
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about it in terms of you ever see what you
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know some people wear for fashion and you're like, hey,
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could I pull that off?
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Speaker 1: No?
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Speaker 2: You can't, don't try to.
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Speaker 3: You're more likely to be able to pull off the
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fashion statement than Warren Buffett's investments.
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Speaker 2: Correct, But even there, you know, it's it's questionable. Proceed
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with caution. Yeah, it's you can't wear the Lady Gaga
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meat dress. It's just not gonna work for you.
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Speaker 3: I've been mean to have a conversation about your fedora, Chuck.
9:23
I actually do own a couple of doors, not surprised.
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But don't worry about it. Let's take a quick break here.
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Speaker 2: And I'm a little worry about it. I just be worried.
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It's just a nice hat about it. Look, what are
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your fred astare? Occasionally you need something that's a little
9:38
bit more demure than just a baseball hat, you know,
9:45
and the other thing. Quite honestly, as a proud bald man,
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the little brim at the back helps to keep the
9:52
you know, the back of the neck a little bit
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cooler too. So indeed, there's there's a lot of considerations here.
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10:23
Speaker 2: Piece of the New York Times. I love the headline
10:27
mortgage rates fell, then rose? What comes next? Probably gonna fallen,
10:31
rise a little bit more. What do we do the
10:33
hokey poke and turn ourselves around? I mean, come on,
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what are we doing here? No one knows what's going
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to come next for mortgage rates? Shure, we do predictions?
10:43
What kind of predictions? Where are we right now in
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the thirty year? Okay? Hold on, I see where you're
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going with this. Mortgage News daily right now, this is
10:50
as of the close of Friday, has us at six
10:53
point nine to two.
10:55
Speaker 3: Tucker, how long of a payoff do you want? Thirty
10:57
years months, twelve months from now? Rate the blue whale,
11:02
now forget it. Three months from now rates lower higher, Chuck,
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three months three months lower lower to twelve months higher?
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Speaker 2: Hang on, I'm going lower?
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Speaker 1: Right?
11:14
Speaker 2: That was fun? What do we do next? So higher
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than lower? What did I just agree to? Yeah?
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Speaker 3: Nobody knows. Nobody knows where rates are going to go.
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The Federal Reserve has been cutting rates. They've cut We're
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talking about seventy five basis points since Septembertember nineteenth, and
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since that point in time, the average thirty year mortgage
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rate has gone up seventy five basis points.
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Speaker 2: So I don't know where rates are going to go.
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Speaker 3: It's going to depend on everything else going on in
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the economy.
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Speaker 2: I think, look, it comes next what what?
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Speaker 3: I just Yeah, it's just a silly thing to to
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guess at.
11:53
Speaker 2: Ultimately, it's going to be dependent on two things, inflation
11:56
and growth. Short term, my expectation is both inflation and
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growth probably stick around here. Well, I think inflation might
12:06
pick up a little bit, the reason being companies and
12:09
individuals front loading purchases the next couple of years, the
12:12
next couple of months rather. But I'm also kind of
12:17
the opinion that, hey, we just went through this little
12:19
rebound in growth, and usually those again they kind of
12:21
roll over every couple of months, and so maybe we're
12:24
heading into one of those. So maybe they balance out
12:26
into Tucker, I'm going to change. I'm going to change
12:29
my next three months. It's gonna be the exact same
12:33
push in twelve months, three months, three months, I'm going push.
12:38
So I'm lower lower, Chucks, push higher.
12:41
Speaker 4: You said higher lower, No, And now I got to
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get a new post.
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Speaker 3: You just didn't listen, Tucker, No, you said lower than
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hould the tape Mike had lower for both I did, Tucker, Tucker,
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you're not being a very good listener.
12:53
Speaker 2: I understand the desire to only listen to what I say.
12:55
Speaker 4: Mic is higher higher.
13:02
Speaker 2: Can we get your wife in here to tell you
13:04
that you're a bad lesson?
13:06
Speaker 4: Let's get her up on the hotline here. Yeah, she'd
13:08
be the first one in line.
13:10
Speaker 2: Anyways. I think, Look, it's ultimately going to be about
13:14
growth and inflation, and I think that it's likely that
13:19
in the next three months, one or both of those
13:22
might roll over lower. In the next twelve months, one
13:26
or both of those might roll higher. That's kind That's
13:29
all I'm saying.
13:30
Speaker 3: Yeah, and I think moreover, there's really no compelling argument
13:36
that I can see whatsoever her rates substantially lower.
13:39
Speaker 2: Recession, Yeah, that's the only one. Recession tough to understand.
13:43
How you get there? Response?
13:46
Speaker 3: There's a path to recession out there, yep, But does
13:49
it materialize?
13:51
Speaker 2: Who the heck knows. This thing has been resilient for
13:53
the last two years when everyone and their grandmother has
13:56
been calling for recession.
13:58
Speaker 3: So it'll just be one of the those additional headwinds
14:02
for new homeowners at least and existing ones who want
14:05
to refinance the higher than I think anyone anticipated mortgage
14:09
rates at this point in time. I just don't think
14:11
a lot of people thought we would still be hanging
14:13
out at seven percent by November of twenty twenty four.
14:16
The other pieces burdening homeowners pretty substantially these days is
14:21
a piece from the Journal on hoas and condo fees,
14:25
and this one I find interesting, But I'm going to
14:30
make the argument that it's not really any different whether
14:33
or not you're in a condo fee or HOA, because
14:35
you're facing the same increased costs. And don't be surprised
14:38
when your HOA has to bump up their monthly amounts
14:41
or their one time things by substantial amounts for inflation.
14:45
Speaker 2: Yeah, the subeditor here is rising costs for insurance, repair
14:48
and maintenance, or pushing hoadues higher. And yes, it's pushing it,
14:52
pushing hoadues higher. But if you just own a home
14:55
that's not in an HOA, they're still moving higher. It's
14:58
just you don't pay them as any HOA fee on
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a monthly basis.
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Speaker 3: Yeah, as a owner of a pool, I can tell
15:04
you that the costs for everything associated with keeping my
15:10
pool that nice crystal blue are quite a bit higher
15:14
than they were four years ago, And whether you pay
15:17
that as part of your HOA dues or as an
15:19
individual homeowner, it's not going to make a big difference.
15:22
I think the one lesson here is the only real
15:24
way to control home ownership costs is by doing the
15:28
work yourself, And if you plan to do so, then
15:30
buying into an HOA is probably a bad idea.
15:32
Speaker 2: Right, That's not really it's not why that works. Its
15:34
ways aren't really a great thing.
15:36
Speaker 3: For do it yourselfers, Right, Like I'm going to mow
15:39
my own lawn and repair all my shutters.
15:42
Speaker 2: Well, no you're not. Yeah, your name is gonna have
15:45
something to do say about it. So I think that
15:48
on this the part that's going to continue to be
15:50
problematic more than others is the insurance piece. Yeah. I
15:55
can't figure out what the answer is here, other than
16:02
home prices maybe having to come down. It's it's just
16:07
not affordable in a lot of areas at this point
16:09
to have insurance premiums moving the way they are with
16:13
incomes where they are. And so that's kind of where
16:18
I'm I'm landing on this stuff is the other pieces
16:22
are are starting to plateau somewhat like repair and maintenance costs. Ultimately,
16:28
what you're paying for there is labor, and those costs
16:31
have moderated. Yeah, in the last year or two. The
16:35
insurance piece, look no further. What we're seeing in freaking
16:39
Massachusetts right now. We got freaking wildfires here, like we're
16:43
in California.
16:44
Speaker 3: Yeah, not expected, you know, like, this is not great.
16:50
I think it's forty eight states right now are in drought.
16:52
Speaker 2: Yeah, it's it's insane. Forty eight states are in drought
16:56
and the other ones had twenty eight inches of rain
16:57
dropped by two hurricanes on them. Yeah.
17:00
Speaker 3: I'm hoping to take the optimistic view on the insurance
17:03
market because prior to the two hurricanes ripping through the
17:06
southeastern United States, there were insurers actually stepping back into
17:11
Florida and buying back policies from the state insurer there,
17:15
and so you did start to see some healthy behavior
17:18
in some of these markets. And I do think that
17:21
at some point you wash through all of these giant
17:26
premium increases that insurers have had to implement. I genuinely
17:30
don't think it's that insurers don't know how to price
17:32
the risk in.
17:33
Speaker 2: A lot of these markets. I think in most of
17:34
the markets they do know how to price the risks.
17:36
They would get screwed like they couldn't attract anyone of
17:39
those prices.
17:40
Speaker 3: And I think again, for better or worse, people are
17:44
now getting okay with those prices. Legislators are realizing that
17:49
they have to accept these prices, and we might have
17:52
more pain to go here, but I think you're getting
17:54
close to the point where insurers starts stepping back into
17:57
some of these markets.
18:11
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18:28
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18:33
Speaker 2: Mike, there's a piece in the Wall Street Journal. It's
18:34
titled how Seniors can do smart Wroth IRA Conversions. First question,
18:39
what would a dumb Wroth IRA conversion look like?
18:43
Speaker 3: Doing the entire thing at once in one taxier and
18:48
bring your tax rates up so high that it makes
18:50
no financial sense whatsoever. That's a dumb one.
18:53
Speaker 2: Yeah. Potentially also taking into account, you know, things like
18:56
medicare rates and things like that, where you might you know,
18:58
be bumped up into a higher monthly payment on those.
19:00
Speaker 3: YEA doing it the same year you're selling a giant
19:02
investment property for example. So or generally just doing it
19:07
without any sort of math behind it, I think is
19:11
the takeaway on anything tax strategy related. Right, if you're
19:17
just kind of sticking your finger up and trying to
19:20
see which way the wind is blowing, you're probably going
19:22
to miss something and something that's fairly important. But yeah,
19:26
I mean seniors, even folks who have already started required
19:30
minimum distributions, it can occasionally make sense for them to
19:34
look at roth ira conversions. And I guess we should
19:37
just start with talking about how that all works, Chuck. So, yes,
19:41
you can take money. You can still put money into
19:44
a roth ira after you are done working. The only
19:48
way you're allowed to do so, though, because you don't
19:50
have any earned income at that stage. The only way
19:52
you're allowed to do so is by taking it out
19:54
of a traditional retirement account and placing it into a
19:58
wroth one. There's a specific process here. Some four one
20:02
k's allow you to do it within the plan, Others
20:04
do not. Sometimes you have to have an IRA to
20:07
do it. But there's a number of reasons people do this,
20:10
and largely it's based on well a couple of different reasons.
20:14
One reducing long term taxes for your family and this
20:20
sometimes also includes like beneficiaries. And the second piece would
20:24
be reducing your required minimum distributions for the future. That
20:29
kind of plays into the same factor there. But required
20:32
minimum distributions on roth irays don't exist for the original
20:37
count holder. They might for the beneficiary. Again, but that's
20:40
the baseline here is you take money out of that
20:42
pre tax portion to beef up that tax free portion.
20:46
Speaker 2: Yeah, and again, the specific amount and the way that
20:49
you approach this is going to depend on your specific situation.
20:53
There is no one size fits all of Hey, what
20:56
age should I start converting to ROTH or how much
20:58
did I do? You have to take into account the
20:59
thing Mike mentioned there, and it's something where right now,
21:05
with the way that the tax code is structured, you
21:07
also don't have the ability to get a do over
21:10
if you make a mistake. Until when did they change
21:13
and get rid of recharacterizations. I think it was during
21:16
the Trump Was it seventeen or was it nineteen during
21:18
the Secure Act? I can't remember, but either way in
21:19
the last five to seven years that they got rid
21:22
of the ability to take a mulligan, take a mulligan
21:25
on it. And so you need to make sure that
21:28
you're actually, you know, looking at this and getting it
21:32
right the first time, because if you don't, any potentially, yeah,
21:34
in a bit of a pickle with those higher taxes
21:36
or maybe higher Medicare premium.
21:37
Speaker 3: So the most common timeframes, yeah, it's usually between retirement
21:41
and age seventy three or seventy five that most of
21:44
these things occur. But as Lauras Andres points out in
21:47
this Wall Street Journal piece, it can make sense to
21:49
do so later. I've seen examples where maybe you've got
21:52
like a five or ten year age gap between husband
21:55
and wife or partners, and you know, hey, my required
21:58
minimum distribution has already started, but it still might make
22:00
sense to do some wroth conversions over the top of
22:03
that in order to avoid a bigger tax problem down
22:06
the road. This has become a pretty popular strategy. There
22:10
is a lot to beware of, especially when you are
22:13
retired from search charges that you'll pay on Medicare, from
22:18
the net investment tax from heck, even you know people
22:23
who might be on a Obamacare health insurance policy and
22:27
how your incomes might affect that, including.
22:29
Speaker 2: Roth Ira conversions.
22:30
Speaker 3: Maybe you're you know, retired pre sixty five and not
22:33
on Medicare yet. There's other considerations there, and it can
22:37
be tough to evaluate all this stuff on your own
22:41
and get it exactly right if you're trying to do so,
22:45
or quite frankly, if you're working with somebody professionally already
22:49
who's not at least considering it as part of your
22:51
financial strategy, then please call the folks at Armstrong Advisory Group.
22:55
We can help you evaluate whether or not this will
22:58
be a successful strategy for you. And yeah, frequently we
23:00
tell people, hey, it's not the right thing for you
23:02
to do, but that's at least good information to have.
23:05
Please call us to the Armstrong Advisory Group where we
23:08
can help you with your tax strategies when it comes
23:10
to your investment portfolio by calling eight hundred three nine
23:14
three four zero zero one. That's the number for the
23:16
Armstrong Advisory Group and we offer free consultations throughout New England.
23:20
That number once again is eight hundred three nine three
23:24
four zero zero one.
23:26
Speaker 1: The proceeding was paid for by Armstrong advisory group a
23:28
registered investment advisor. Nothing in the ad or in any
23:31
Armstrong guide a specific financial, legal, or tax advice. Consult
23:34
your own financial, tax into state planning advisors before making
23:37
any investment decisions. Armstrong may contact you to offer investment
23:40
advisory services.
23:41
Speaker 2: Mike, I want to just talk about one other thing.
23:44
I know that the last segment was talking about not
23:46
last segment. Last thing we covered was talking about roth
23:49
Ira conversions. There's an interesting topic just to talk about.
23:53
I know, wroth Ira conversions are something that typically you
23:56
talk about, as you noted, once you start getting a
23:58
little bit older, kind of a you're you know, fifties sixties,
24:01
where you might have kind of a pre pre retirement
24:05
scenario where your income might be dropping, or you know,
24:08
just after retiring when your income is lower. There's an
24:12
interesting discussion that I think is happening right now just
24:15
in general about the idea of traditional IRA versus roth IRA,
24:20
even for younger people, and even for younger people that
24:22
might be in higher tax brackets. The conventional wisdom and
24:26
what you know kind of was always there was, Hey,
24:29
if you think your tax bracket in retirement is going
24:32
to be higher than it is today, opt for the WROTH.
24:35
If you think that your tax bracket in retirement is
24:38
going to be lower, use the traditional because you get
24:40
the deduction today. That's that's the math, and generally that's
24:43
kind of been the accepted wisdom. Anecdotally, I've been hearing
24:49
larger numbers of people in their twenties, thirties, forties, regardless
24:54
of income, saying, look, I'm pushing to use the WROTH
24:58
to begin with, just because because Roth four one ks
25:01
are more widely available now and there's more tax code
25:06
uncertainly about where tax rates could be in the future. Hey,
25:09
let me take that off the table to a certain
25:11
you know, in one direction at least. Yeah, thoughts on this,
25:14
because I'm seeing it more and more.
25:17
Speaker 3: I think you can make an argument, and it certainly
25:20
depends on your situation, because I have a really, really
25:23
tough time believing that somebody in the twelve percent income
25:27
tax bracket, for example, is going to face substantially higher
25:31
tax rates at any point in their life. But if
25:34
you're in that thirty seven and you can afford to
25:38
do so, that's the highest possible income tax bracket, you know,
25:41
locking in some certainty around paying taxes at thirty seven percent.
25:44
Could you make a compelling argument that over the rest
25:47
of your lifetime you could face forty or forty five
25:50
percent federal tax rates. I don't think that's that crazy,
25:54
But I still see mistakes around this.
25:56
Speaker 2: I see a lot of you know, you talk about
25:58
that example.
25:59
Speaker 3: The most common what I see is, well, I don't
26:02
know what to do, so I'm gonna split the difference
26:03
and do half and half. Sure the other piece too. Remember,
26:07
you know, think about long term what your plans are.
26:10
Because let's say you are contributing and living in Massachusetts,
26:14
but your plan is to not retire here.
26:16
Speaker 2: That changes the formula dramatically.
26:19
Speaker 3: Right now, you're saying, hey, I'm going to you know,
26:21
pay the state of Massachusetts there five percent or nine
26:24
percent if you're making a lot of money, and then
26:28
I'm going to retire. Someone that doesn't have an income
26:30
tax or has a lower income tax like that, that's
26:33
a very different equation. And so yeah, it's yeah to
26:38
your point, Maybe you're saying more of it just because
26:40
there's more row for one k's available.
26:42
Speaker 2: Maybe that's yeah.
26:43
Speaker 3: I just see a lot of not hard thinking about
26:47
which way people should go.
26:48
Speaker 2: To take a quick break here. When we come back,
26:51
we've got stack Root.
26:53
Speaker 1: Lets find daily interviews and full shows of the Financial
26:57
Exchange on how Are You Too? Page, Get cut up
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27:18
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took part in this year's DAV five K. The event
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If you weren't able to attend, but would still like
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a wide variety of initiatives like the DAV Transportation Program,
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which takes disabled vets to important medical appointments that supply
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presented by Veterans Development Corporation.
27:59
Speaker 2: Mike, what do you got for stack Roulettes?
28:01
Speaker 3: I want to talk a little bit about the continued
28:04
streaming wars and the new trends that may or may
28:08
not be significant to the business models. These companies have
28:11
all been under a fair bit of pressure to show
28:14
that they can actually make any money in the space,
28:16
and Netflix has been the only one.
28:18
Speaker 2: That's reliably capable of doing so.
28:21
Speaker 3: But an interesting statistic the monthly median percentage of premium
28:27
premium streaming video subscribers. I don't know how they describe premium, but.
28:31
Speaker 4: You know, not paying for ads.
28:33
Speaker 3: Not paying for ads, and you know, presumably that's going
28:36
for ten plus bucks a month on average. The percentage
28:41
of them who rejoined the same service they had previously
28:44
canceled within a twelve month period was about a third.
28:48
So about a third of streaming customers are saying, I
28:51
watched my show, I don't need to continue to pay
28:54
for you over the next nine months. I'll resubscribe labor later.
28:58
And I wonder how big a problem that is for
29:00
the stream platforms and whether they go the route that
29:04
I've thought they would go for quite some time, which
29:06
is incentivizing year long contracts.
29:09
Speaker 2: Most of them already do that, do they? Disney does,
29:13
Disney does, Disney Plus has an annual option that I
29:16
think is like ten or twenty percent cheaper. Okay, I
29:19
believe Peacock does, but I could be wrong on that.
29:22
I don't know, But I mean, I've done this with Netflix.
29:25
Speaker 3: Doesn't need to. Netflix has no need to. I've done
29:28
this with Max. I hate that name, HBO. Max canceled
29:33
and then resubscribed as the dumbest name and Netflix to me,
29:38
Netflix and Amazon and maybe Disney are the only ones
29:41
to me that are not going to face this behavior.
29:44
And it is kind of problematic, right. It is pretty
29:48
tough if you're a streamer to say, oh, yeah, you know,
29:51
once this next hit show goes out, I know that
29:53
ten percent of my subscribers, for example, are going to
29:56
cancel and I'm going to see a massive deficit in
29:58
monthly incomes.
29:58
Speaker 4: I mean, I just paused polu subscription for a third
30:01
time and gives you the option to pause it for
30:05
at most is twelve weeks.
30:06
Speaker 1: You can pause your subscription.
30:08
Speaker 2: So I did that. You know what model of these
30:10
places shouldn't adopt? What's that is what the New York
30:14
Times are doing with the Athletic. I'm not familiar. It's wild.
30:19
Speaker 4: I didn't see this.
30:20
Speaker 2: So the Athletic if you're not familiar with it. It
30:23
is basically like sports only Like originally it developed with
30:27
like different verticals for each city, and each city its
30:30
own dedicated correspondence. But it's remind me, did they buy this?
30:34
New York Times didn't start it. They bought it maybe
30:36
two or three years ago, and now it's just kind
30:38
of general, you know, national sports news with some local
30:42
coverage as well. Got it and each year for the
30:45
past three years, I have like when my thing comes up,
30:48
it tells you, like, hey, it's gonna be if forget
30:50
what the cost is. It's like sixty or ninety bucks
30:52
for the year in order to like to continue your subscription.
30:56
And I make a note the week before, like cancel
30:58
my subscription, and I go through and I'll have to
31:01
pull up exactly what it is that I end up paying.
31:05
They give you like eighty or ninety percent off the price.
31:08
I think I'm paying ten dollars for the full year.
31:11
I love when companies do this. It is so dumb,
31:14
Like all I had to do was click one button.
31:16
That's what Hulu did for me. How much do they discount?
31:19
Speaker 4: It was like whatever Hulu cost at that time, it
31:22
was like seven ninety nine, eight ninety nine, and they're like, hey,
31:25
we're sorry to se you go, but before you do go,
31:27
how about two ninety nine a month.
31:29
Speaker 3: I finally stopped doing this for six months with my
31:31
high speed internet. But I know right now if I
31:33
wanted to, I could call FiOS, cancel my WiFi and
31:39
then come back as a new customer, or put it
31:41
under my wife's name more likely, and I know that
31:43
they would offer me fifteen dollars cheaper than what I'm
31:45
paying right now. It became too much of a hassle
31:48
to go return the box every time. But when you're
31:50
talking about something as simple as an online subscription or
31:54
streaming over the internet, people are going.
31:56
Speaker 2: To do exactly that.
31:57
Speaker 3: You cannot make these offers so compelling and treat these
32:01
people like a new customer. Else they're going to do
32:02
exactly what Chuck's doing and just rake you over the coals.
32:06
Speaker 2: No, I'm looking at it now, just because I was
32:08
curious what it actually was. So I got an email
32:12
from them, and this was on June twenty ninth. Hey,
32:16
your subscription set to renew on July twenty eighth. It's
32:19
going to be seventy one dollars and ninety nine cents
32:21
and lets you cancel immediately. I go in and say, okay,
32:24
let me cancel. I'm now paying nineteen ninety two for
32:27
the next twelve months. It's less than two dollars a month.
32:30
That is such a bad business model. I like, what
32:33
are we even doing here? Like, no, wonder print media
32:36
can't make money if they're doing that. If streamers start
32:38
discounting it, the economics are even worse. Yeah, because of
32:41
all the licensing costs. That is very much some silliness.
32:46
And now we have to go to just a fantastic story. No,
32:49
this one out of Mattel. So the Wicked movie is
32:53
going to be launching in theaters on the twenty second
32:56
of November. Wicked, if you're not familiar with it, it
33:00
is basically the story of the two major witches from
33:06
the Wizard of Oz and kind of how they became,
33:08
their perspective, who they are and everything. Yeah, it's their
33:11
life story. It's a documentary and it's documentary. Is that wrong?
33:17
It's like Best in Show? Yes, it's like the Blair
33:21
Witch Project. You know, it's basically the same thing. I
33:24
think they're very different movies. Actually, Anyways, as part of
33:28
this listen, you have all kinds of different toys and
33:32
merch that you want to make because it's not enough
33:33
to just own the box office. You need to own
33:36
the retail market as well. And so apparently there was
33:41
a Barbie edition or a Wicked Edition Barbie that is
33:46
being put out by Mattella's part of this, and somehow
33:50
on the box to the Wicked Edition Barbie, rather than
33:56
directing people to the url the website were the Wicked movie,
34:01
they accidentally put the name put the web address for
34:06
an adult film studio instead. Now it's kind of a
34:13
big oversight. Now, Fortunately, as I think Mike or Tucker
34:18
brought up during one of our breaks, they didn't do
34:20
this in an email where the link was clickable or
34:23
anything like that, so it wasn't like that would have
34:25
been a lot worse.
34:26
Speaker 1: Yeah, it's on the back of the box.
34:27
Speaker 2: But in any case, if you are a kid who
34:31
has a phone because your parents have given you one,
34:34
and you're like, as much as I wish this weren't
34:36
the case, I do know like nine to ten year
34:38
olds who have phones and they're like, oh, like let
34:40
me go, and oh no, that's not what I thought
34:43
it was at all kind of a problem. So Mattel
34:46
is now issued in a statement we deeply regret this
34:49
unfortunate error and or taking immediate action to remedy this.
34:52
Parents are advised that the misprinted, incorrect website is not
34:55
appropriate for children. It's also unclear how many of these
35:00
toys actually have been distributed to stores already and how
35:02
much how many of them are just in warehouses somewhere.
35:05
Speaker 3: But you have a tough time getting your wicked Barbie doll?
35:08
I think is the takeaway here?
35:10
Speaker 2: It sounds like, according to the Hollywood Reporter, they're they're
35:13
pulling these from Walmart, Best Buy in Amazon right now
35:16
in order to try to prey up too many of
35:18
them from getting out.
35:19
Speaker 3: Is this going to be the hot must have item
35:22
of Christmas twenty twenty four? Now might be a secondary
35:25
market for this day the originals that have the misprint
35:29
this is valuable. My goodness, you know a mint condition
35:34
one of these?
35:35
Speaker 2: Boy, This might be corporate blunder of twenty twenty four.
35:40
I gotta go through my list. This is definitely gonna
35:42
make it into the into festivsts this year, but definitely yea,
35:47
it's it. I have to go through my list because
35:50
we often forget how long a year is. It's three
35:52
hundred and sixty five days.
35:54
Speaker 3: If you weren't you know, if you didn't know, some
35:56
years one hundred and fifty two that would do shows.
35:58
Speaker 2: For some years like this year, there's three hundred sixty six.
36:01
It was a leap heer too, so it's extra content. Yeah,
36:07
it's an extra point three percent for Festivus this year.
36:10
We're gonna take a quick break back at tomorrow. We'll
36:12
see you then.