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The Return-To-Office battle is heating up · The Financial Exchange Show

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This is the Financial Exchange with Chuck Zutta and Paul Lane.
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Speaker 2: Chuck, Paul and Tucker with your and markets not doing anything.
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It's uh you guys ever read XKCD, the like comics
1:25
that's online. Nope, there's a good one there. Like guys
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sitting there with a stick and he's poking this thing
1:31
and he's going do something. That's what this market's like
1:34
this week. It's just not really doing much of anything.
1:37
And look, that's not bad if you're someone who's benefited
1:40
from the run up inequities over the last almost twelve months.
1:44
We're up almost forty percent on the S and P
1:45
five hundred since mid October of last year. If you're
1:49
someone who's benefited during that time, he might be like, Yeah,
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I'm cool with it just hanging out here. It doesn't
1:53
need to go anywhere else right now, as long as
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it doesn't go down again. And so you got the
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S and P up one point today, the dows off
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one thirty, the nasdaqc's up fifty eight, so just kind
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of treading water at this point. I will also point
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out that at this point, with three and a half
2:13
days left in trading for the month. The S and
2:16
P five hundred is still up more than two percent
2:19
for the month, despite the pieces that were published after
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the first three days of trading suggesting that September was
2:26
gonna be another very bad September four equities. Granted, I
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know this can still go the other way in the
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next three and a half days because markets can move quickly.
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But when you publish pieces saying, hey, we've had three
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bad days in the market and that means September is
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gonna be a bad month, and then it doesn't turn
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out to be the bad month, you're gonna get called
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out for being kind of the scammy grifter that you are.
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Speaker 3: That's that's a little harsh.
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Speaker 2: No, it's not like we had this. We had another
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one earlier this year. It was January fifth, I think
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it was. There were three down days to start the year,
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worst days of the year in twenty twenty four. I
3:06
don't remember if it was Bloomberg, the Wall Street Journal
3:08
or CNBC, but one of them had this whole piece
3:12
that was published about, hey, when when the market does
3:14
badly in the first three days, it means that the
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year is gonna be bad. And honestly, when you publish
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crap like that, you deserve to be called a scammy
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grifter because that just doesn't mean anything about what's actually
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going to happen.
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Speaker 3: Yeah, sure, but I wasn't against in general. I'm against
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that sentiment where you look at CNBC, you know, worst
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day in since twenty twenty two, or you know all
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these outlandish headlines that they use. I mean, that's the
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business that they're in, right, they want to grab your attention.
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You can't just put a headline CNBC Stock's not moving
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this week, very boring week. Then no one's gonna click
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on it. So I get your frustration with that. The
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September statistics, though, I did find interesting where there was
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a referendum on Hey, actually there's statistical proof thats September
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to be the weakest stock line. That commentary I did enjoy,
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And that's why I'm pushing back on the slimy grifteris
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because I actually did enjoy that commentary.
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Speaker 2: So there's it's one thing to say before the month, Hey,
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September tends to be a bad month for stocks. You're
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saying the reactionary It's the problem that I have are
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the ones where it's hey, let me pull up the piece.
4:22
I just have to get it here, just because again
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I want to make sure that I call it out
4:28
properly when I when I do this, let's see, Nope,
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it's not that one. Where is it going to be?
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I'll dig it up just because again it was it
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was notable to me. Here we go. It was on
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September ninth, after the first four trading days of September,
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because the first week of September was shortened because of
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labor day. Quote, September is once again a tough month
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for stocks. Okay, well, let's wait till My point was, Hey,
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let's wait till September and even says, going back to
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nineteen twenty eight, the S and P five hundred is
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decline average of one point two percent in September, the
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weekest month of the year for stocks. Fine, okay, that's
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that's that's great that you have it there, But then
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you have this this whole thing. I'm trying to find
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the part that I that really bothered me. Despite the
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market's recent slide, it still looks expensive. By some measures.
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Companies are trading twenty one times they projected earnings over
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the next twelve months above their ten year average multiple
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of eighteen. And it's this whole piece about hey, September's
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in the red and this is the norm for September. Okay,
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well it's September twenty fifth now and September is not
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in the red. Why'd you write this piece after four
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days of trading like that? That's the problem is someone
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writes this, and yes, I know that they have to
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write something, but like, we have a show to do
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every day also, and we don't resort to stuff like
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this that then influences people to make decision is based
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on incomplete information, right, you know, like we do a
6:04
show every single day and not once have you ever
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heard us come in and you know, big first time
6:11
because again this was like front page in the journal
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business section. Well the whole journals is the business sect.
6:16
But you get what I'm saying. We never come in
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and say, hey, this happened and you need to, you know,
6:22
sell everything, or this happened and you need to because
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that's not how it works, you know, Like and especially
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we don't quote incomplete information. You can't quote September returns
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after four days. That's very fair, you know, like because
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this piece it can't be published. Now the piece of
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the if the month ended today, which it hasn't, which
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is why you don't publish it today. That headline could be, Hey,
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September normally a tough month for stocks, not so bad
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through the first you know, twenty five days of the
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month actually, which I know doesn't sell anything, but like,
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you don't have to get into all this stuff. The
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other one that we did it was at the beginning
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of the year. Let me get to this because again,
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this stuff just bothers me, because people do make trading
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decisions based on this and investment decisions based on these pieces,
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which we tell them, Hey, look, if you're making an
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investment decision based on one piece, you need a better
7:23
investment strategy. But there's other stuff that was in here.
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Here we go, We've got this one. This is from
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January fourth of this year. Major industries have pulled back
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in the first three sessions after ending twenty twenty three
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with a bang. The S and P is down one
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point seven percent. It's worse start to the year since
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twenty sixteen. I love those. That's great. The Dow is
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down point seven and the Nasdaq is down three point three. Okay,
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they quote an investment strategist here. If January is positive,
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that's investors putting money to work. They're telling the Federal
7:56
Reserve that the economy and the companies they're investing in
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that they think they can grow for it. And the
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first month is typically strong for stocks. A phenomenon knows
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the January effect. Another theory suggests that investors have more
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cash to put to work in markets in January after
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receiving their year end bonuses. And then it goes on
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to talk about, hey, this could you know, be this
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early year slump that doesn't pretend well for markets, And
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it's like, guys, it's been three days of the year
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and you're saying that we need to be nervous because
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January could be bad. And guess what, January wasn't bad
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this year, Like that's the worst part of it. They
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talk about, Oh, this January effect that you need to
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watch out for. And stocks were up in January.
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Speaker 3: Not to mention, they were up twenty four twenty five
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percent in the year of twenty twenty three. So you're
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coming off the heels of if you participate in the
8:44
full year prior, you were up twenty five percent. If
8:47
you had the market.
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Speaker 2: It's it's always like everyone always gets a kick out
8:53
of being bearished because it makes you sound smart. But
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the fact is, if you're actually investing in stocks over
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the timeframe that you're supposed to, which is the long term,
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being bearish is pretty much the worst consistent investment strategy
9:10
that you can have. There are times to go against
9:15
the herd and everything, but it's just the bearishness that
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comes out when we have three bad days to start
9:23
the year, or four bad days to start September. Oh gee,
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this is the September that they warned us about. It
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just it bothers me because I see people who read
9:35
that stuff and they're like, yep, I've got a trade
9:37
based on what I saw there, And it just feeds
9:41
into the whole idea of hey, the real money if
9:47
you look at like, if you look at where the
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real money's made in markets. I say this quite a bit.
9:51
It's in the flow. It's in being the bro the
9:54
company that's actually handling the transactions. It's not in you know, hey,
10:00
I need to invest in this or invest in that.
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And all these pieces do, in my opinion, is convince
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people to do one thing or the other, when in fact,
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most of the time. The best thing for them to
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do is absolutely nothing, because they have no edge.
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Speaker 3: Do you have a folder of articles that you put
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in your kind of grind your gears folder that you
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look at for set occasions.
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Speaker 2: Not not like this, I should have one for this,
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Quite honestly, I keep my I build it up my
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Festivus folder over the course of the year. But that's
10:27
more just for fun companies we do. We do Festivus
10:32
at the end of the year, and that's more for
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stories that are just more humorous, you know, the ones
10:39
that really bother me. Sometimes you get humorous ones that
10:41
do really bother me, Like the Bloomberg one from was
10:44
that last year or the year before talking was last year, Yeah,
10:46
the Bloomberg one that said, hey, the best way to
10:48
deal with inflation is to let your pet die. Oh
10:51
gosh it literally it was like, hey, if you can't
10:54
you know, pay all of your bills right now, maybe
10:57
you should skip out on going to the vet the
10:59
next time your pet gets sick. It is expensive. And
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it was like, oh, like wow, I didn't realize we
11:04
were going there, Like that's a fluffy that just got
11:07
really aggressive.
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Speaker 3: A lot of pet shatter over the last twelve plus months, there.
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Speaker 2: Has been there has been.
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Speaker 1: Uh.
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Speaker 2: So, now that we've covered that for the entire first segment,
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we're going to take a break, and then Corey Adams
11:17
from Robert Half is going to join us talking about
11:19
this uh burgeoning battle about employees returning to the office
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that's ramping up, and so we'll talk to him right
11:27
after this.
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Speaker 3: We are joined by Corey Adams from Robert Half who
12:33
just put out a piece regarding the return to office battle. Corey,
12:36
thanks so much for joining.
12:37
Speaker 5: Us, Hey Paul, thanks for having me.
12:40
Speaker 3: Amazon made headlines Corey over the course of the last
12:43
week or so when they announced that they were going
12:45
to haul all their employees back into the office five
12:47
days a week effective January twod and really made a
12:51
public display of making this a mandate in something that
12:55
they felt was very important. But here in your piece
12:59
you covered that there is still a semblance of quite
13:03
a bit of hybrid and remote work throughout the New
13:06
England area and the rest of the country. What were
13:08
some of the biggest takeaways that you had from the
13:10
piece that you guys put together regarding remote work?
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Speaker 6: Corey, Sure, so research for the mid year update as
13:17
your reference for Robert has Demand for Skill Talent report
13:20
found that thirty seven percent of US job seekers are
13:23
interested in fully remote positions, while sixty percent with like
13:27
a hybrid role. Thirty one percent of workers planning to
13:31
look for a new role in the second half of
13:33
this year or those who are currently looking went on
13:35
to say that the desire for more flexibility is their
13:38
primary driver motivator to look for a new job. And
13:41
then in the same survey, thirty eight percent of workers
13:45
who aren't looking at all in this moment went on
13:47
to say that they're not looking because they do not
13:51
want to lose the flexibility that they currently have. And
13:54
then the last kind of key finding and a little
13:57
bit of a local perspective on this, and I think
13:58
this is really encouraging. Massachusetts was amongst the states with
14:03
the highest number of newly created hybrid jobs in Q
14:08
two of this year at twenty six percent, and that's
14:10
up sixteen percent from the same period last year in
14:13
twenty twenty three. However, Massachusetts is also on the low
14:17
number side of being fully remote jobs reported at eight percent.
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Speaker 3: It seems like the hybrid is the sweet spot that
14:24
most employees are clamoring for. One of the things that
14:26
we've been monitoring quite closely is the state of the
14:29
labor market in general. Obviously, we were in the golden
14:32
age for employees over the course of the last couple
14:34
of years, with tremendous wage growth and very low unemployment
14:38
around three and a half percent. Today we sit at
14:40
four to two percent, and I just wonder, Corey, one
14:44
of the thoughts that I had is that as the
14:46
pendulum is shifting back towards the employer and unemployment creeps up,
14:50
have you seen in any of the data any evidence
14:52
that there are more employees trending to going in office
14:57
or what has that migration looked like in the other
15:00
direction as people coming back to the office. Do you
15:02
have any insights there?
15:04
Speaker 6: Yeah, so let's just take a national look at this
15:07
for a moment. So new fully inoffice job postings actually
15:12
declined in twenty twenty three by fourteen percent. Now, at
15:16
the end of twenty twenty three, the analysis went on
15:19
to show that sixty nine percent of job postings were
15:23
for fully on site rules and that held steady in
15:26
the first quarter of this year. Now, in Q two,
15:28
which is when the survey was conducted, the figure fell
15:31
to sixty seven percent.
15:32
Speaker 5: So you've got this dynamic happening nationwide.
15:35
Speaker 6: At least you're seeing a decrease right now for in
15:40
office five days a week, but you're also seeing a
15:43
decrease for fully remote. And then the juxtaposition of that
15:47
is you're seeing the rise and increase of hybrid.
15:51
Speaker 5: So I basically think it's safe to say.
15:53
Speaker 6: That the flexible work model across the US is currently
15:57
shifting to hybrid.
16:00
Speaker 3: Seem like that is the case. Perhaps Amazon just stands
16:03
out as an anomaly here in this sector. If this
16:07
is Corey Adams from Robert Half Corey, thanks so much
16:10
for taking the time today speak with us.
16:11
Speaker 2: We really appreciate it.
16:12
Speaker 5: Thanks, Paul, I was a pleasure of Good Week.
16:14
Speaker 2: Paul. You familiar with Google, Yes, am, so. They're probably
16:21
one of the four biggest tech companies on the planet,
16:25
and they filed an EU anti trust complaint accusing Microsoft
16:31
of anti competitive practices as it relates to cloud services.
16:38
And what's interesting to me about this is not whether
16:42
or not there's any merit to it, because I have
16:46
absolutely no idea. What's interesting to me is that Google
16:49
filed it in the first place.
16:51
Speaker 3: Because Kellen calling the kettle black, Well.
16:54
Speaker 2: It seems to me, just based on my basic understanding
16:57
of how Google's business operates, and I don't know, maybe
17:00
the two different anti trust cases that have been brought
17:03
against them in the US recently, that maybe they're not
17:07
really I don't know, maybe poking Microsoft this way isn't
17:13
the best thing for them, because I'm sure Microsoft has
17:15
loads of data that they can say, Okay, you think
17:18
we're anti competitive here, fine, we're gonna file over search
17:22
in the EU because of reasons X, Y and Z,
17:25
and now you've got to deal with this as well,
17:27
and we'll just you know, rack up legal costs for
17:29
each other.
17:30
Speaker 3: What was their search engine?
17:31
Speaker 2: Bing? Is that Microsoft's? That tells you how well Microsoft
17:34
is doing?
17:34
Speaker 3: Yes, yeah, I was about to I was about to
17:37
google what is Microsoft's search engine? That's just say that's
17:41
where they That's where.
17:43
Speaker 2: They sit at this point.
17:44
Speaker 3: That was the most amusing takeaway that I had to
17:46
is that Google is out there throwing their weight around
17:49
the antitrust pool where they often swim in that same
17:53
pool themselves. EU is the best place to do it.
17:57
We'll see how that lawsuit trains tanspires here.
18:01
Speaker 2: So that's the latest between these two tech companies. And
18:06
again I have no idea of what Google is alleging
18:08
has any merit, but.
18:11
Speaker 3: I don't know.
18:11
Speaker 2: Generally, when you're anti competitive, it's best not to accuse
18:14
other people of being anti competitive too.
18:19
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18:43
Speaker 2: Let's talk a little bit about restaurants here. There's a
18:46
piece in Bloomberg Opinion. Headline is restaurant customers aren't tapped out,
18:51
they're just bored. Your thoughts on the piece and what
18:54
it says, Paul, It.
18:55
Speaker 3: Was an interesting piece here, basically breaking down a group
19:00
of restaurants that have really struggled post pandemic. Obviously there
19:03
was a surge when restaurants reopened, but they've struggled over
19:06
the last couple of years compared to others in the
19:08
fast casual space that have done a little bit better.
19:10
So basically sort of pinning Chipotle, whose stock is up
19:14
two hundred and forty six percent since twenty nineteen against
19:17
some of it's I wouldn't say necessarily direct competitor peers,
19:21
but swimming in the same sort of space Darden restaurants,
19:24
Applebee's Outback, and Denny's other sort of casual sit down
19:29
restaurants that all are trading below their twenty nineteen levels
19:32
and have struggled quite a bit. And basically what this
19:35
Bloomberg piece is outlining is that those restaurants, all of
19:39
Garden and others, have failed to innovate the way that
19:42
Chipotle has. And I've been trying to rack my brain
19:45
and think, Chuck, it just seems like they're in that
19:49
middle ground that isn't very appealing at this point in
19:52
time when I think about my own personal dining habits,
19:54
where either if you're looking for something that's kind of
19:58
a casual meal, you're kind of skewing to the pickup
20:00
delivery side of things.
20:01
Speaker 2: But if I really want.
20:02
Speaker 3: To go out to eat, I kind of want to
20:04
do it on the nicer end of things, you know,
20:05
have a couple of drinks with my wife and have
20:07
a good time when I go out. And that middle
20:10
tier section that all of Garden kind of falls in
20:13
is just not as appealing, And I wonder if that's
20:14
the reason why they've seen sort of a cut down
20:18
in traffic and sales growth there.
20:19
Speaker 2: So I guess the question that I would have on
20:22
something like that is why now, because that's always been
20:26
the case, Like it's you've always had kind of Okay,
20:29
you get cheaper options, you know, the fast casual places
20:32
have always been around. The high end places have always
20:34
been around, but there's always been this you know, middle
20:37
area for the Applebee's and cracker barrels and those of
20:41
the world. So why are they like what specifically is
20:46
making people view them differently now because that was a
20:51
very successful business model for a long a long time.
20:55
And and just the idea that hey, there, you know
20:57
people are bored with going out to dinner. I don't
21:02
know that that does enough to get me there, because
21:06
we're still seeing very much increase spending on traveling things
21:10
like that you will get you know, tsa throughput, and
21:12
it's still is setting all new records. Airlines have said,
21:15
look like we're seeing some weakening demand in the future,
21:18
but hey, overall, you're still seeing all kinds of spending
21:21
on travel and all that stuff. So it's not just
21:25
services related spending in general declining, And so I can't
21:31
make heads or tails of like the exact reason, but
21:34
just oh, like people have gotten sick of these places?
21:37
Why'd they get sick of them now? Why not ten
21:39
years ago or twenty years Why today?
21:42
Speaker 3: I wonder if the innovation on the Chipotle side of things,
21:46
or all those restaurants where their product is just so
21:48
much easier to obtain now, whether it's pick up through
21:52
their mobile app, delivery options through Uber Eats, whether that
21:56
just makes them so much easier to grab that there's
21:59
not need to really go to this middle tier. And
22:02
again I'm spitballing here that you know, the excuse that
22:05
they've leaned on the most, the alli of guards of
22:07
the world is that their lower income consumer or their
22:10
lower income patron that they typically make the most of
22:14
their money on, they've cut back significantly and spending. But
22:16
that does run in the face as you mentioned, that
22:18
services spending in general has kept up paced pretty well.
22:22
So it's an interesting debate to me, and it's not
22:26
really exactly pinpoint the direct reason, but everyone has their
22:29
theories as to what's going on.
22:30
Speaker 2: There, folks, want to let you know that the Armstrong
22:32
Advisory Group is hosting two different seminars this fall. The
22:36
first it's coming up in just a couple of weeks
22:39
at the MGM Hotel in Springfield's on Tuesday, October eighth,
22:44
will be broadcasting from the hotel, which is connected right
22:47
to the casino and there's free parking in the MGM lot.
22:50
All you do is take the elevator down to the
22:52
casino floor, short walk to the hotel from there. So
22:55
that's on October eighth. The next one is at the
22:59
Margarita Hotel and Resort in Hyanas. That's on October twenty fourth,
23:04
so about a month from now, and that's gonna have
23:06
Ed Lambert, host of the WXTK Morning Show, joining us
23:10
there as well. In both cases, you join us for
23:14
a live broadcast of the Financial Exchange, followed by an
23:17
educational lunch with the Armstrong Advisory Group. What are we
23:21
gonna be talking about maybe the upcoming presidential election, maybe
23:25
the policies that each candidate have proposed and what effect
23:29
those policies might have on the current economic landscape. We'll
23:33
also talk a little bit about potential market volatility and
23:36
how that might influence decision making going forward. You can
23:39
sign up for either of these events, the one nearest you,
23:42
the one farthest whichever one you want to go to
23:44
by visiting Armstrong Advisory dot com slash Events. That's Armstrong
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Advisory dot Com Slash Events. Just fill out the form
23:53
associated with the event that you'd like to attend, and
23:56
again that is Armstrongadvisory dot Com Slash Events.
24:01
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
24:04
registered investment advisor. Nothing in the ad or in any
24:06
Armstrong guide a specific financial, legal or tax advice. Consult
24:09
your own financial tax into state planning advisors before making
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any investment decisions. Armstrong may contact you to offer investment
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advisory services.
24:17
Speaker 2: Piece in the New York Times, sticking with the restaurant
24:19
topic here, restaurant portions are about to get smaller our
24:22
Americans ready, And basically what this is talking about is that, look,
24:29
portion sizing's gotten a little bit out of control. Mean,
24:32
how many times do you go when you say, Okay,
24:33
I'm getting a burger at this place and it comes
24:36
with literally a mountain of fries so big that you
24:38
couldn't hold them all with two hands if you tried to.
24:42
And I'll be honest, I view it as a personal
24:45
challenge to try to eat every one of those fries.
24:48
I might not think that as I'm sitting down, I
24:50
might say, well, I'll just need a few of them,
24:52
but as long as they're on my plate, I'm going
24:53
to keep eating. Is basically where I end up.
24:56
Speaker 3: That's the biggest mental hurdle that I had to overcome
24:59
is I'm the same mindset where whenever I go out
25:02
to a restaurant, you view it as kind of a hey,
25:04
a special occasion, you're out of the house, and what's
25:06
on my plate. I'm paying for it or someone's paying
25:09
for it. I want to get the most out of
25:10
this meal. I've got to clear my plate. And what
25:13
that results in for years was terrible stomach aches because
25:17
I overdid it. And I still even we were out
25:20
to dinner this past week and my wife with the kids,
25:22
where we're trying to get in now quickly, I still
25:24
found myself kind of kicking myself that we ordered more
25:28
food than we ultimately consume. And it backs up waste
25:31
studies that they've done that forty percent of restaurant foods
25:34
according to a study in twenty twenty, get discarded because
25:37
their portion sizes are so big and you don't consume
25:40
it the whole time. So it's it's a problem that
25:43
I agree with that it is very standard in most
25:47
American restaurants, and according to a twenty twenty four National
25:52
Restaurant Association survey, seventy five percent of us out there
25:56
Americans want smaller portions for less money.
25:59
Speaker 2: No, I don't think this means we're gonna get you know,
26:02
one French fry or anything like that. But the whole
26:04
premise of this piece is one of the major forces
26:06
that is reshaping the restaurant industry is restaurants trying to
26:10
stay cost competitive because of inflation in their supply costs
26:14
the last couple of years. Hey, if you can just
26:17
shrink the number of French fries that you give, you know,
26:19
things like that. Okay, you got ways that you can
26:22
potentially figure out how to manage your pricing and still
26:26
maintain fair value. Now, there are in any restaurant. You
26:30
talk to any restaurant owner, chef, for anyone who knows
26:32
the business side of a restaurant, they'll tell you, Look,
26:34
there are certain items that are higher margin than others. Okay, pizza,
26:41
I was going Caesar salad with it, you know, that
26:44
pizza from the margin. The pricing. So I had a
26:49
buddy of mine who lives in New York text me
26:53
the other day. It was like he was complaining about
26:55
how expensive pizzas and I'm like, okay, like send me
26:57
the pricing that you're getting. And this was not from
27:00
like crazy high end place. It wasn't Dominoes, but it was,
27:03
you know, good middle of it. It's like twenty eight
27:06
dollars for a large pizza in New York. Wow, I'm
27:09
sitting there, I'm like, my goodness, you know, like that's
27:13
a lot for a pizza. You know, I'm not saying
27:15
it needs to be ten dollars, because I understand that
27:18
it's not nineteen ninety three anymore. But I don't know.
27:22
It feels to me like you start getting a pizza
27:25
north of nineteen twenty bucks and you're kind of like,
27:29
this better be a really good pizza, right, you know,
27:31
like this better be life changing. And most of the
27:34
time it's it's pizza. You know, it's just what it is.
27:37
But in any case, so you've got economics that are
27:40
kind of weighing on things. You also have the rise
27:44
of these GLP one drugs that are now you know,
27:47
causing a bunch of Americans to lose weight. I say causing,
27:50
like it's a bad thing. They're losing weight because of
27:52
these and the reason why is it depresses their appetite. Well,
27:55
if that's the case, you don't you know, you don't
27:57
go into a restaurant looking for the same portion size
28:00
that you used to have into restaurants ad just as
28:02
a result of that by offering, you know, some smaller
28:05
portion sizes that are available and things like that. So
28:09
I think we're at this really interesting junction where a
28:13
combination of a few factors could reshape how big meal
28:17
sizes are at sit down restaurants. And I'll be honest
28:22
with like, it's going to be really interesting to see
28:24
how it plays out and how that affects, you know,
28:27
the balance of how these businesses operate over the next
28:29
five to seven years. Here definitely stake a quick break,
28:33
Rooney when we come back, time for stack Roulette.
28:38
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29:00
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29:36
Speaker 2: Paul, What do you have for me for stack Roulette?
29:39
Speaker 5: Chuck?
29:39
Speaker 3: We'll kick it off with the CEO of Novo Nordis
29:43
was grilled yesterday by the Senate regarding weight loss drug pricing.
29:48
Nova Nordisk is famously behind ozempic as well as well
29:52
GOVI I believe is the pronunciation that I've heard it
29:54
pronounced otherways, but regardless, you know what I'm talking about
29:57
weight loss drugs, and the focus of this Senate meet
30:00
was to grill him on the weight loss drug pricing.
30:04
Nova Nordice ozempic drug retails for I believe, around thirteen
30:08
hundred bucks a month, or nine sixty nine for ozempic
30:11
and thirteen fifty for a Goovi in the United States
30:14
and in many other countries out there, you can get
30:16
it for much lower than that, in the hundreds of
30:18
dollars a month, whether you're talking about Germany or others
30:21
out there. And while I would agree that the sticker
30:24
price is high, the crux of the issue comes back
30:29
to just how convoluted and messed up our system is
30:32
on the healthcare side of things, where you have the
30:34
manufacturer nov Nordice going with a list price of that
30:38
one thousand dollars a month, then you have the PBMs,
30:42
the pharmacy benefit managers that are charge of negotiating against
30:46
that list price, and then you have the health insurance provider,
30:49
and those three people are all taking a cut at
30:52
some point in time during that transaction, which leads to
30:54
these exorbitant list prices in order to get to the
30:58
end consumer. And so nothing was really resolved as a
31:01
result of this meeting, but it's certainly something that is
31:04
in the headlines because it's surge in popularity as it
31:07
tries to address OBC in this country, which there's a
31:10
large market to hit.
31:11
Speaker 2: Yeah, it's Look, I don't have any unique insight on
31:16
drug pricing or how it should or shouldn't work. I
31:19
don't know. The piece that most people I think look
31:23
at and object to is that difference in cost between
31:26
what it is in the United States and in other
31:30
economies that are similar in nature. Again, the UK and Germany,
31:33
I think you'd classify as you know, pretty similar in
31:36
terms of their their developed countries without you know, too
31:39
much overall economic growth. And you see the pricing that
31:42
that they're getting, and so you sit there and you're like, Okay,
31:44
why is the list priced so much higher? And the
31:47
answer is, well, the US healthcare system is basically combining
31:52
the worst parts of the private and public sector into
31:55
something that makes it just this albatross that you can't
31:58
really figure out how it works or change in any
32:01
meaningful fashion. It's just kind of gross. How do we
32:05
fix it? I have no idea, you know, I'm not
32:09
going to sit here and like be like, oh, well,
32:11
we got to I don't know. There's a bunch of
32:13
smart people that look at this and they have yet
32:16
to figure out the best things that we can do
32:20
on it. What I can't tell you is what we're
32:22
doing is probably not the answer. And most of the
32:25
criticisms that I think tend to be valid are as
32:28
you mentioned, Hey, there's a bunch of middlemen that get
32:31
rid of transparency and pricing and take a cut for themselves,
32:34
And if you were to streamline that whole process, you,
32:38
I think have a better ability to actually get the
32:41
kind of pricing that you want to see with more
32:42
transparency and fewer profits being taken in the middle by
32:46
people that don't really do anything in terms of actually
32:50
affecting health outcomes.
32:51
Speaker 3: It'll be interesting to see what happens when Medicare goes
32:54
up to negotiate with the Nova noordice and whether or
32:58
not to cover a ZEMPE that should be done in
33:01
twenty twenty five, and the price changes if any, or
33:05
if they cover, would go into effect in twenty seven.
33:07
So interest to see what happens there.
33:10
Speaker 2: Piece in the New York Times, the Biden administration is
33:13
announced a sweeping initiative to ban Chinese developed software from
33:16
Internet connected cars in the United States, justifying this on
33:21
national security grounds. And this is basically something that look,
33:30
we've talked about quite a bit in terms of the
33:33
potential for espionage, you know, on American citizens through you know,
33:38
back doors that lead to the Chinese military. And so
33:43
the Biden administration proposing this, whether or not it actually
33:46
makes it into effect, and how watered down it is
33:49
and how strong it is I think remains to be seen.
33:52
But look, this is something that is a major concern
33:56
for me in terms of the ability of the Chinese
33:59
military potentially access information about the mobility and transportation of
34:05
all Americans, but in particular those with access to you know,
34:09
classified or sensitive technology and who might work in areas
34:13
that make them vulnerable to you know, potential espionage. And
34:17
so this is something that I view is welcome, But
34:21
I don't know how strong it's going to be because
34:23
it still is just a proposal and we don't have
34:24
the final rules and what kind of carve outs might
34:28
exist in here.
34:28
Speaker 3: Yeah, I think it's important to make the point that
34:30
this is a national security concern rather than the tariff's
34:34
assessed on the EV's exportation from China, which I believe
34:38
it's one hundred percent tariff on any EV's come from China.
34:41
It's not something that really there was any cars prior
34:44
to that tariff in being in place being imported that
34:48
were electrical vehicles from China. But this is more focused
34:51
on not because of the trader economic advantage. It's all
34:55
about national security and it's something that I can certainly
34:58
get behind too, and many other should be in a
35:00
similar boat where you just don't want any way for
35:04
them to leverage any sort of vespionage practices in place
35:09
if this were to proliferate Chinese software through our vehicles.
35:13
Speaker 2: Taking a look at markets as we head towards the
35:15
top of the hour, the Dow was off two hundred
35:17
and seventeen points, about half a percent. SP five hundred
35:20
is down five points a tenth of a percent in
35:22
the Nasdaq up twelve points about a tenth of a percent,
35:24
so not too much movement there. Ten Your US Treasury
35:27
is up three point seven basis points to three point
35:29
seven seven three percent. Oil West Texts Intermediate following a
35:33
dollar twenty four barrel to seventy thirty two, and we've
35:37
got gold here up five dollars and twenty cents nouns
35:41
to twenty six eighty two and twenty cents. Also the
35:45
triple A national average four gas prices up three tenths
35:49
of a cent to three twenty one and three tenths
35:51
still footing around that three twenty market, not making any
35:54
major further moves lower. As you know, we'd kind of
35:58
hoped for it and saw the potential for given gasoline futures,
36:02
but hey, three twenty still better than three p fifty,
36:05
So we'll take it for now, quick break for the
36:08
entire rest of the day. We are back tomorrow, and
36:12
we would love it if you joined us here on
36:15
the Financial Exchange