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Does buying the dip still work? · The Financial Exchange Show

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  Speaker 1: and Paul Lane.
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  Speaker 2: Chuck Paul Tucker with you, kicking off hour two of
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  Speaker 2: the financial exchange. Markets are pretty quiet overall, kind of mixed.
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  Speaker 2: The Dow is off about one hundred and twenty points,
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  Speaker 2: the SMP is down ten, NASDAK up twenty four though,
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  Speaker 2: so strength continuing in uh tech stocks in particular. I mean, look,
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  Speaker 2: most of it right now, concentrated in Vidia AMD on
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  Speaker 2: the back of optimism surrounding a deal they have made
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  Speaker 2: with Saudi Arabia to supply a bunch of chips there.
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  Speaker 2: And so you've got again mixed markets today overall, more
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  Speaker 2: stocks selling off than nine positive territory on a net
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  Speaker 2: basis three hundred and thirty five. More stocks down today
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  Speaker 2: in the S and P five hundred than up. But
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  Speaker 2: when the stocks that are up are in Vidia, AMD,
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  Speaker 2: Google and Tesla, that can offset you know, a whole
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  Speaker 2: lot of weakness that's happening elsewhere where. And that's kind
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  Speaker 2: of the story of what we saw in twenty twenty three,
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  Speaker 2: in the first half of twenty four, so this is
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  Speaker 2: a day that looks reminiscent of, you know, kind of
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  Speaker 2: that eighteen month period that was really good for equity markets,
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  Speaker 2: but not great for the average stock. So we'll have
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  Speaker 2: to see where things go as today develops in equity markets.
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  Speaker 2: On the bond side of things, yields continuing to move
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  Speaker 2: upward a little bit. The ten uere is now at
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  Speaker 2: four point five h five percent. Also yesterday, mortgage rates
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  Speaker 2: holding steady overall at six point nine two percent on
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  Speaker 2: the Mortgage News Daily thirty year fixed rate national average.
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  Speaker 2: So still kind of hanging out right in that six
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  Speaker 2: nine range. No clear, you know, break in either direction
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  Speaker 2: there at the moment. We've got in energy oil prices
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  Speaker 2: moving down just a tick here, down twenty seven cents
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  Speaker 2: a barrel to sixty three forty right now. So you've
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  Speaker 2: got a little bit of a dip after those rows
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  Speaker 2: about ten percent in the last week after the China deal,
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  Speaker 2: you know, started to percolate through. And we've got gold
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  Speaker 2: down sixty one to ten and ounce about two percent
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  Speaker 2: to thirty one eighty six and seventy cents. Top story
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  Speaker 2: of this hour from Bill Dudley, who is the former
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  Speaker 2: president of the Federal Reserve Bank of New York. And
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  Speaker 2: it's titled the China Trade Deal Doesn't solve the Fed's problems,
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  Speaker 2: and it kind of lays out the idea that there
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  Speaker 2: are still a number of things that the FED is
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  Speaker 2: trying to get a handle on, and so most likely
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  Speaker 2: the FED is going to remain paused for an extended
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  Speaker 2: period of time here, just because the data is going
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  Speaker 2: to be pointing in all different directions and it still
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  Speaker 2: is unclear exactly where policy is going to be at
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  Speaker 2: the end of the year. So let's start first with
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  Speaker 2: the data. There's a realistic world, Paul, where over the
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  Speaker 2: next couple months, retail sales data goes into toilet because
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  Speaker 2: people pre bought a bunch of cars before tariffs, and
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  Speaker 2: you know, we're buying this and that and everything, and
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  Speaker 2: now they say, great, we don't need to buy any
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  Speaker 2: of that stuff anymore. And so you say, okay, retail
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  Speaker 2: sales data is weakening. Does that mean that, like the
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  Speaker 2: US economy is struggling. Maybe, but also maybe people feel
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  Speaker 2: a little bit better about their situation now that the
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  Speaker 2: stock market's recovered, and so maybe they start taking trips again,
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  Speaker 2: and so airfares go back up, and so the CPI,
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  Speaker 2: you'd say, okay, like airfares have been down the last
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  Speaker 2: couple months in CPI, that's been a big help. But
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  Speaker 2: auto tariffs are still in place, and so you know
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  Speaker 2: auto you've got auto insurance rates that are starting to
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  Speaker 2: move up again, and so inflation starts moving up as
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  Speaker 2: retail sales are moving down, and the jobs market just
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  Speaker 2: kind of chops around. Like the point I'm getting at
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  Speaker 2: is I don't know that the data is going to
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  Speaker 2: show any coherent picture over the next few months. You
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  Speaker 2: can have parts of the economy that look like they
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  Speaker 2: are in deep doodo, you can have parts of the
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  Speaker 2: economy that look like they're surging overall. On the aggregate,
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  Speaker 2: you might just say, hey, economic growth ends up coming
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  Speaker 2: in one and a half to two percent and there's
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  Speaker 2: no recession, but you're not really sure what's gonna come next.
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  Speaker 2: And if that's the case, the FED might just sit
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  Speaker 2: there and say, yeah, we don't know what this means.
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  Speaker 2: We're just gonna we're gonna wait for more clarity before
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  Speaker 2: we do anything.
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  Speaker 3: That's exactly what we were talking about the first hour.
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  Speaker 3: It's just there are so many variables that we need
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  Speaker 3: time to see how they're going to play out. So
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  Speaker 3: getting the clarity on inflation, getting a good understanding of
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  Speaker 3: where the economic growth lies and where the labor market
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  Speaker 3: is as well as the conclusion of the ninety day
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  Speaker 3: pause for those reciprocal tariffs. On the policy front, those
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  Speaker 3: three factors all need to be sorted out over a
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  Speaker 3: period of time. And when you look at the CME
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  Speaker 3: futures market, which tries to assess the probability that the
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  Speaker 3: FED would take any sort of action, it very conclusively
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  Speaker 3: says from a percentage standpoint or a probability standpoint that,
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  Speaker 3: just as mentioned in this piece, the idea of ray
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  Speaker 3: cuts really for the moment isn't on the table until
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  Speaker 3: mid September. We're really not going to see any type
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  Speaker 3: of action until then.
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  Speaker 2: So it will continue to.
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  Speaker 3: Parse through news stories in different pieces of economic data
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  Speaker 3: that may lead us in one direction or another. But
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  Speaker 3: I think it's important to keep a little bit of
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  Speaker 3: that more intermediate term in mind when looking at the
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  Speaker 3: economy for the next six months or so, four or
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  Speaker 3: five months or so.
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  Speaker 2: So I think that when when we look at the FED,
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  Speaker 2: the other thing that's going to complicate this, there's a
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  Speaker 2: decent chance that two months from now we get to
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  Speaker 2: July ninth. July ninth is the UH, I don't know
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  Speaker 2: if it's the ninth actually might end up being like
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  Speaker 2: the seventh just because it's the ninety day window from
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  Speaker 2: the original tariff pause on April ninth, So we get
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  Speaker 2: to July ninth, Paul, do you know what's gonna happen
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  Speaker 2: on July ninth?
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  Speaker 3: Absolutely not.
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  Speaker 2: I have no idea what's going to happen. Then I
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  Speaker 2: could see a reasonable path where the Trump administration says, hey,
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  Speaker 2: like we're continuing to have good conversations. As such, we
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  Speaker 2: are pausing reciprocal terror for an additional ninety year, one
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  Speaker 2: hundred and eighty days. The ten percent baseline stays in effect.
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  Speaker 2: I could see a reasonable case where they say that
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  Speaker 2: exact thing, but say except there are a couple of
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  Speaker 2: countries where we're not having great conversations and so their
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  Speaker 2: reciprocal tariffs are going into effect. Which countries I have
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  Speaker 2: no idea. I could see a reasonable world in which
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  Speaker 2: they say, you know, after much negotiation, we haven't been
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  Speaker 2: able to get anywhere. We need to put these back
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  Speaker 2: in place because we're not having productive enough conversations. I
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  Speaker 2: could see a world where they say, you know what,
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  Speaker 2: these have been great, We're gonna reduce the baseline tariff
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  Speaker 2: rate from ten to five. I'm not saying any of
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  Speaker 2: this is likely, or that I can price it in
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  Speaker 2: any way, shape or form. But all the things I
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  Speaker 2: just said are very much possible, especially after what we
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  Speaker 2: saw last weekend, which came in much better than anyone
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  Speaker 2: was expecting. As far as the effective tariff rate that
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  Speaker 2: is now applied to Chinese imports, definitely, definitely, So you
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  Speaker 2: go out too much from now we don't know what
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  Speaker 2: that policy is going to be. And this gets at
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  Speaker 2: something that I think is really interesting. So there's a
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  Speaker 2: guy that I follow on social media. His name is
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  Speaker 2: Moulson Heart, and he runs a company called via Heart
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  Speaker 2: and they make all kinds of different consumer products like
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  Speaker 2: kids toys and stuff like the stuff that you would
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  Speaker 2: import from China because that's the cheap place to make it.
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  Speaker 2: And it's again like cheap plastic toys, and there's only
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  Speaker 2: one place that you can get the cheapest you know,
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  Speaker 2: for that in at is China. And so here's what's
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  Speaker 2: interesting on May eighth, and this is on X And
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  Speaker 2: again these are polls that are you know, you can't
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  Speaker 2: verify the results of them, but again you figure the
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  Speaker 2: people that follow someone like this or probably you know,
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  Speaker 2: a representative sample of whatever he said, what have you
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  Speaker 2: done with your orders from China since Liberation Day? And
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  Speaker 2: what he showed at that point was that fifty five
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  Speaker 2: percent of respondents, when tariffs were still at one hundred
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  Speaker 2: and forty five percent said they had paused all shipments
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  Speaker 2: from China, twenty one percent said they had paused approximately
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  Speaker 2: half of their shipments, and twenty four percent said that
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  Speaker 2: they made no change at all. But seventy five percent
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  Speaker 2: of respondents had said we either paused all or around
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  Speaker 2: half of our shipments from China. So yesterday he goes
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  Speaker 2: and asks, hey, what do you think. I'm sorry the
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  Speaker 2: question he asked, I'll phrase that how he did. Now
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  Speaker 2: that tariffs are thirty percent, what are you doing with
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  Speaker 2: your China shipments? And the responses again, like when you
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  Speaker 2: look at the subset that actually answered, because one of
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  Speaker 2: the poll options is just show me the results. Uh,
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  Speaker 2: fifty percent said they're now buying as much as they can,
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  Speaker 2: so okay, great, like back the truck up, like let's
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  Speaker 2: do this again. About twenty percent said we're buying half
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  Speaker 2: as much as what we want now. That could be
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  Speaker 2: because they don't have the cash flow to buy more.
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  Speaker 2: It could be because maybe they think tariffs are gonna
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  Speaker 2: go lower. You don't know. About fifteen percent said we're
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  Speaker 2: still not buying anything.
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  Speaker 1: Okay.
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  Speaker 2: That could be because hey, we already bought enough and
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  Speaker 2: we don't need to right now. It could be because
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  Speaker 2: they don't have the cash flow. Who knows this and that,
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  Speaker 2: but we have no idea like the size and scale
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  Speaker 2: and the magnitude of this. The fifty percent that says
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  Speaker 2: they're buying as much as they can, those could all
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  Speaker 2: be thousand dollars orders, just as an example. The percentage
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  Speaker 2: that says, hey, we're buying half as much as what
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  Speaker 2: we want, they could be million dollar orders. Like, we
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  Speaker 2: don't know like the scale of any of this. And
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  Speaker 2: this gets it the problem that the Fed's gonna have,
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  Speaker 2: which is, no one knows what any of this is
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  Speaker 2: gonna look like as trade between those two countries restarts,
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  Speaker 2: and so it's going to be really messy. And if
• 10:54
  Speaker 2: you don't know what to do, usually the best thing
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  Speaker 2: to do is to do nothing and not try to
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  Speaker 2: overthink it. Yep, let's take a quick break. When we
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  Speaker 2: come back, we will do a little bit of trivia
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  Speaker 2: and then we're talking salt.
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  Speaker 2: Let's talk a little bit about salt. You big fan
• 13:07
  Speaker 2: of sault, Paul? Are you more of a pepper guy? Pepper?
• 13:10
  Speaker 2: You're all about Tucker? What about you? Salt? Pepper flake, salt?
• 13:14
  Speaker 2: Oh yeah, finishing salt? Yeah yeah, I could respect that.
• 13:17
  Speaker 2: So the salt that we're actually talking about is the
• 13:19
  Speaker 2: state and local tax deduction, which currently stands at a
• 13:23
  Speaker 2: ten thousand dollars cap So if you have state and
• 13:26
  Speaker 2: local taxes that are north of ten thousand, you cannot
• 13:30
  Speaker 2: deduct them on your taxes. That's part of the twenty
• 13:33
  Speaker 2: seventeen tax bill that the first Trump administration passed so
• 13:38
  Speaker 2: you've got the House Ways and Means Committee that is
• 13:41
  Speaker 2: trying to figure out what to do with this, because
• 13:45
  Speaker 2: Republicans have a very narrow majority in the House of
• 13:47
  Speaker 2: Representatives and you have a handful of I believe it's
• 13:50
  Speaker 2: five reps from New York and New Jersey that are
• 13:55
  Speaker 2: sitting there saying, look, we need to bring something back
• 13:58
  Speaker 2: to people in our districts because otherwise they're gonna give
• 14:02
  Speaker 2: us the boot. And by the way, we might have
• 14:03
  Speaker 2: you know, eyes on higher office, and you know, if
• 14:06
  Speaker 2: we want to say that we delivered something to our state, like, hey,
• 14:09
  Speaker 2: we need to you know, bring something to them. And
• 14:13
  Speaker 2: so the House Ways and Means Committee has a proposal
• 14:16
  Speaker 2: that they put out that would raise the salt cap
• 14:19
  Speaker 2: from ten thousand to thirty thousand, and it would phase
• 14:21
  Speaker 2: out for individuals making north of two hundred thousand and
• 14:25
  Speaker 2: for married couples making more than four hundred thousand. You
• 14:30
  Speaker 2: then have these this group of holdouts. What do we
• 14:34
  Speaker 2: call them? Can we can? We like name them? It
• 14:37
  Speaker 2: probably won't matter if they come to an agreement today,
• 14:39
  Speaker 2: but they thought they were gonna have something yesterday and
• 14:42
  Speaker 2: they don't yet. So obviously, you know, with Congress only
• 14:45
  Speaker 2: actually in session for a handful of days each year,
• 14:50
  Speaker 2: each one kind of counts. So I think that you know,
• 14:55
  Speaker 2: what we call them may or may not matter. But
• 14:57
  Speaker 2: the initial ask that I saw from UH, from this
• 15:03
  Speaker 2: group was for like a sixty four thousand dollars carve
• 15:08
  Speaker 2: out for individuals and like one hundred and twenty eight
• 15:10
  Speaker 2: thousand four married couples. It was, it was in that ballpark.
• 15:13
  Speaker 2: I don't know the exact number because I don't have
• 15:15
  Speaker 2: it in front of me, but it was significantly different.
• 15:17
  Speaker 2: Which obviously you sit there and you say, okay, the
• 15:20
  Speaker 2: obvious middle ground is make it you know, a fifty
• 15:23
  Speaker 2: thousand dollars deduction that phases or you know, a forty
• 15:27
  Speaker 2: thousand dollars deduction that phases out after you know, six
• 15:31
  Speaker 2: hundred thousand dollars in income or something like that. Like,
• 15:33
  Speaker 2: it shouldn't be that hard to bridge this. The interesting
• 15:37
  Speaker 2: thing is that they've been going at it on this
• 15:39
  Speaker 2: specific piece for two days now and haven't gotten there yet.
• 15:42
  Speaker 2: And you can't pass this legislation without those holdouts getting there.
• 15:48
  Speaker 2: This is all something that I say simply to indicate
• 15:52
  Speaker 2: why I do not pay too much attention to exactly
• 15:55
  Speaker 2: what people are talking about with you know, any congressional
• 15:58
  Speaker 2: bill before it gets to the point where they're going
• 16:01
  Speaker 2: to sign it, is because it always goes through all
• 16:03
  Speaker 2: these things and they're gonna have to figure out some
• 16:06
  Speaker 2: kind of compromise on this in order to get it done.
• 16:10
  Speaker 2: The other piece that I do think I'm starting to
• 16:13
  Speaker 2: pay attention to now that we are getting more details.
• 16:17
  Speaker 2: In general, there are more and more things that are
• 16:21
  Speaker 2: being thrown into this that are tax breaks. You've got this,
• 16:26
  Speaker 2: You've got no tax on tips. The way that they
• 16:28
  Speaker 2: are trying to pass the no tax on Social Security
• 16:32
  Speaker 2: is through further complication of the tax code through a
• 16:36
  Speaker 2: increase in the standard deduction. If you are of Social
• 16:39
  Speaker 2: Security Aids, you have the tax deductibility of American made cars,
• 16:46
  Speaker 2: the ensure the interest payments on those. Right. So, like,
• 16:52
  Speaker 2: you got a lot that's being crammed in here, and
• 16:54
  Speaker 2: all I can say is there's gonna have to be
• 16:57
  Speaker 2: a lot of heavy lifting done in order to make
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  Speaker 2: this work with the deficit. Otherwise all we end up
• 17:02
  Speaker 2: doing is saying, Okay, no one's serious about the deficit.
• 17:05
  Speaker 3: Again, it feels that way looking at I like we're
• 17:09
  Speaker 3: heading even In the summary of this particular piece, they're
• 17:13
  Speaker 3: stating that the bill so far adds only three point
• 17:16
  Speaker 3: eight trillion in deficits, less than the four point five
• 17:19
  Speaker 3: trillion limit lawmakers have given themselves. Uh so already built
• 17:26
  Speaker 3: in a pretty significant increase to the deficit, which you'd
• 17:31
  Speaker 3: like from a long term policy perspective to be a
• 17:33
  Speaker 3: little bit taken a little bit more seriously.
• 17:35
  Speaker 2: Yes, the you can't continue to run six percent deficits
• 17:41
  Speaker 2: without a recession because what that means, based on how
• 17:44
  Speaker 2: automatic stabilizers such as unemployment insurance kick in once you
• 17:49
  Speaker 2: have a recession, a six percent deficit in you know,
• 17:54
  Speaker 2: a baseline scenario with unemployment at four point two percent,
• 17:58
  Speaker 2: means that your deficit goes to like nine to of
• 18:01
  Speaker 2: GDP for the year if you have a recession and
• 18:06
  Speaker 2: to quote the late great you know, Charlie Munger, who
• 18:12
  Speaker 2: come buy them bonds?
• 18:14
  Speaker 3: And if the interest rates have to rise on them
• 18:16
  Speaker 3: when you have thirty six trillion dollars of debt on
• 18:18
  Speaker 3: the bellty sheet also, which.
• 18:20
  Speaker 2: Means that you have to shoo more bonds, which means
• 18:22
  Speaker 2: who come buy them bonds? Right? So I think that
• 18:27
  Speaker 2: again we're we're we're kind of touching the stove here
• 18:31
  Speaker 2: a little bit. And I don't like to touch the
• 18:36
  Speaker 2: stove because hint, hint, it's hot and you don't need
• 18:41
  Speaker 2: to touch it in order to realize that it's hot.
• 18:43
  Speaker 2: So and by the way, like just as an example
• 18:46
  Speaker 2: of this, now that we are, you know through the
• 18:50
  Speaker 2: you know, prime focus being on tariffs in trade, it's
• 18:53
  Speaker 2: still like a secondary thing, is like there still is
• 18:55
  Speaker 2: something there. But the tenure treasury over the last week. Now,
• 19:00
  Speaker 2: a week ago on May seventh, tenure treasury was at
• 19:04
  Speaker 2: four point twenty six percent. That's the low it hit
• 19:06
  Speaker 2: for the day. It's at four point five now, it's
• 19:07
  Speaker 2: up a quarter percent over the last week. That's not
• 19:11
  Speaker 2: telling you anything good about how this is being interpreted. Now, Look,
• 19:15
  Speaker 2: you can say there's a million other things that are
• 19:17
  Speaker 2: playing in like yeah, I understand that there's never any
• 19:20
  Speaker 2: one thing that you can look at, but I do
• 19:23
  Speaker 2: worry about the deficit piece becoming a focus in the
• 19:26
  Speaker 2: coming months. Here, let's take a quick break. When we return,
• 19:32
  Speaker 2: we've got the Trivia answer after this.
• 19:40
  Speaker 5: Bringing the latest financial news straight to your radio. Every day,
• 19:44
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• 19:50
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• 19:57
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• 20:04
  Speaker 4: Today's trivia question was which actor poor trade Robert Langdon
• 20:09
  Speaker 4: in the Da Vinci code back in what two thousand
• 20:12
  Speaker 4: and three somewhere in that range. That would be Tom Hanks,
• 20:15
  Speaker 4: Tom Hanks Portrade Robert Langdon. Ashley from Atkinson, New Hampshire
• 20:20
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• 20:25
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• 20:28
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• 20:32
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• 20:33
  Speaker 2: Piece in the Bloomyberg Today Bloomberg Opinion, it's titled Buying
• 20:37
  Speaker 2: the Dip still works even in this new world. The
• 20:41
  Speaker 2: subheedter is the power of individual investors on display. I'll
• 20:45
  Speaker 2: quote from the first paragraph. Retail investors have won again
• 20:49
  Speaker 2: when trade tensions flared in early April and about six
• 20:51
  Speaker 2: point six trillion dollars in market value vanished from US
• 20:54
  Speaker 2: stockson just two business days, the fifth worst two day
• 20:57
  Speaker 2: drop since the S and P five hundreds creation in
• 20:59
  Speaker 2: nineteen fifty seven. They didn't panic. Instead, what they did
• 21:03
  Speaker 2: what they've learned to do over the past fifteen years,
• 21:05
  Speaker 2: they bought the dip. Six weeks later US stock, the
• 21:08
  Speaker 2: US stock benchmark has not only recovered but surpassed its
• 21:11
  Speaker 2: pre tariff levels, delivering a game of about seventeen percent
• 21:14
  Speaker 2: from the lows to those who kept their nerves. So
• 21:16
  Speaker 2: a couple things on this that I find interesting or
• 21:20
  Speaker 2: that I think are worth noting. The first is, yeah,
• 21:25
  Speaker 2: retail investors absolutely crushed it for the last thirty days.
• 21:31
  Speaker 2: Absolutely nailed it. They did fantastic. The questions that are
• 21:36
  Speaker 2: out there are referenced by a couple of different items
• 21:39
  Speaker 2: in here. The first is this sentence. Instead, they did
• 21:41
  Speaker 2: what they've learned to do over the past fifteen years.
• 21:44
  Speaker 2: And that timeframe is really important because there are significant
• 21:49
  Speaker 2: periods of time in US investing history where if you
• 21:51
  Speaker 2: bought the dip on a ten or fifteen or twenty
• 21:54
  Speaker 2: percent dip, it was not a great move for you. Specifically,
• 21:59
  Speaker 2: look at the tech bubble like that's the most recent one.
• 22:01
  Speaker 2: You can also pretty much look at like nineteen seventy
• 22:03
  Speaker 2: one through nineteen eighty two, horrible time for dip buyers. Now,
• 22:07
  Speaker 2: this is not to say that this is either of
• 22:09
  Speaker 2: those times, but it is to say this is you
• 22:13
  Speaker 2: know something that may or may not end up working.
• 22:16
  Speaker 2: The second piece here that's in reference to that is, hey,
• 22:21
  Speaker 2: do you win the month and end up losing the year? Maybe?
• 22:27
  Speaker 2: Like you don't. It's never done. I like to tell
• 22:30
  Speaker 2: there's a it's it's I don't have like the exact
• 22:34
  Speaker 2: reference for where it's from, but there's one of my
• 22:36
  Speaker 2: favorite you call it a fable or a story, whatever
• 22:40
  Speaker 2: you want. One of my favorite stories from somewhere in
• 22:43
  Speaker 2: Southeast Asia is there's a guy who just like lives
• 22:47
  Speaker 2: on a horse farm with his kid, and one day
• 22:50
  Speaker 2: his horse runs away, and all of the people in
• 22:53
  Speaker 2: his village are like, oh, that's that's just so bad.
• 22:55
  Speaker 2: I'm so sorry for you, and he says, you know whatever,
• 22:59
  Speaker 2: maybe it'll be okay. And the next day the horse
• 23:02
  Speaker 2: comes back and brings like five other horses with it,
• 23:04
  Speaker 2: and everyone's like, oh, like this is so great, like
• 23:07
  Speaker 2: we're so happy for you, like this is wonderful news,
• 23:08
  Speaker 2: and he goes, nah, maybe, And the next day his
• 23:13
  Speaker 2: son gets on one of the new horses, you know,
• 23:15
  Speaker 2: tries to ride it, and the new horse, because it's
• 23:17
  Speaker 2: a wild horse, throws the sun off and the sun
• 23:18
  Speaker 2: breaks his leg and all of his friends go, oh,
• 23:21
  Speaker 2: this is such horrible news, and he goes maybe. And
• 23:24
  Speaker 2: the day after that there's a huge war that breaks
• 23:26
  Speaker 2: out and all of like the able bodied young men
• 23:28
  Speaker 2: go off to war, and his son camp because he's
• 23:31
  Speaker 2: got a broken leg, and all the neighbors say, oh, like,
• 23:33
  Speaker 2: what a great thing, and he says, you know, maybe.
• 23:36
  Speaker 2: And then my point in saying this is, look, you
• 23:39
  Speaker 2: never know how any of this is going to end.
• 23:42
  Speaker 2: We said this, you know, all through April when markets
• 23:44
  Speaker 2: were you know, chopping around and there was a ton
• 23:46
  Speaker 2: of downward volatility. The thing we were saying all during
• 23:49
  Speaker 2: that time is like, you don't know exactly how this
• 23:51
  Speaker 2: is going to end, and we don't know where we're
• 23:55
  Speaker 2: going to be a couple months from now. So yes,
• 23:57
  Speaker 2: if all of those dip buyers bought the dip and
• 23:59
  Speaker 2: off lick quid aided today, they won. If they bought
• 24:05
  Speaker 2: the dip and markets run higher from here and they
• 24:07
  Speaker 2: continue holding on, they won. If they bought the dip
• 24:12
  Speaker 2: and then markets start to roll over and then they
• 24:15
  Speaker 2: try to buy it again and get heavier, and then like,
• 24:18
  Speaker 2: you don't know how all of this is going to
• 24:19
  Speaker 2: play out in the long term, and so my point
• 24:23
  Speaker 2: is when you're actually investing for the long term, trying
• 24:32
  Speaker 2: to win every day or month is not going to
• 24:34
  Speaker 2: be something that's realistic or feasible, and you need to
• 24:38
  Speaker 2: kind of look at those broader trends in what you're
• 24:40
  Speaker 2: actually trying to do with your money as opposed to becoming,
• 24:43
  Speaker 2: you know, a trader, because a trader and an investor
• 24:46
  Speaker 2: are two different things.
• 24:46
  Speaker 3: Paul, Yeah, it was interesting the data here specific to
• 24:50
  Speaker 3: the amount of retail investor activity during that span of time.
• 24:53
  Speaker 3: Check where we saw. If you're looking at data from
• 24:56
  Speaker 3: Charles Schwab, they saw that for their thirty seven million
• 24:59
  Speaker 3: broke accounts over the span of April, they saw ten
• 25:02
  Speaker 3: million trades done per day the first two weeks of April.
• 25:06
  Speaker 3: That was up thirty six percent from a year earlier,
• 25:08
  Speaker 3: and they also saw two to three times the level
• 25:10
  Speaker 3: of new accounts being opened in the month of April. Separately,
• 25:14
  Speaker 3: JP Morgan reported a net purchase of forty billion dollars
• 25:18
  Speaker 3: of stock in the month of April. There too, so
• 25:21
  Speaker 3: something that I was not privy to you during that
• 25:23
  Speaker 3: time that retail investors were extremely active over the period
• 25:28
  Speaker 3: of April and have picked up activity levels to really
• 25:33
  Speaker 3: what we haven't seen since really twenty twenty one, where
• 25:35
  Speaker 3: the memestock frenzy took over and there was a tremendous
• 25:38
  Speaker 3: amount of retail investor activity, but a significant uptick for
• 25:41
  Speaker 3: the month of April. It appears as well.
• 25:43
  Speaker 2: So if you've gone through the last month or so
• 25:45
  Speaker 2: and you've been like, hey, I don't really know what
• 25:48
  Speaker 2: to do and I feel like I'm making bad decisions, Look,
• 25:53
  Speaker 2: it's always worth talking to someone about a second opinion
• 25:56
  Speaker 2: simply because this is something I say this a lot. Look,
• 26:00
  Speaker 2: you spend two thousand hours a year during your working
• 26:04
  Speaker 2: life working. You do that over you know, thirty forty years,
• 26:08
  Speaker 2: you're talking sixty thousand, eighty thousand hours. And if you're
• 26:11
  Speaker 2: savings from that, if you're not you know, comfortable doing
• 26:14
  Speaker 2: it yourself or you don't have the time to do
• 26:16
  Speaker 2: it yourself, hey, finding someone that you can trust can
• 26:19
  Speaker 2: that can help you to figure out what to do
• 26:22
  Speaker 2: as far as investments and retirement planning and answering those
• 26:25
  Speaker 2: other questions, it's a big thing for you. So you
• 26:29
  Speaker 2: can call the Armstrong Advisory Group at eight hundred three
• 26:32
  Speaker 2: nine three four zero zero one to set up a
• 26:34
  Speaker 2: time to meet with one of our advisors. We've got
• 26:37
  Speaker 2: offices all throughout the New England region. That number again
• 26:41
  Speaker 2: is eight hundred three nine three four zero zero one. Again,
• 26:45
  Speaker 2: you're going to, over the course of your career spend
• 26:47
  Speaker 2: sixty to eighty thousand hours working. Make sure that you're actually,
• 26:53
  Speaker 2: you know, taking care of the money you earn during
• 26:55
  Speaker 2: those hours by figuring out, Hey, how do I make
• 26:59
  Speaker 2: it work for me in order to buy a house,
• 27:02
  Speaker 2: a car, send my kids to college, save for retirement.
• 27:04
  Speaker 2: Those are questions that we help answer. Again, the phone
• 27:06
  Speaker 2: number for Armstrong Advisory Group eight hundred three nine three
• 27:10
  Speaker 2: for zero zero one.
• 27:12
  Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
• 27:15
  Speaker 1: registered investment advisor. Nothing in the ad or in any
• 27:17
  Speaker 1: Armstrong guide a specific financial, legal, or tax advice. Consult
• 27:21
  Speaker 1: your own financial tax into state planning advisors before making
• 27:23
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• 27:26
  Speaker 1: advisory services.
• 27:28
  Speaker 2: I got to talk about, well, we got to talk
• 27:32
  Speaker 2: about Warner Brothers Discovery, because you guys are familiar now
• 27:39
  Speaker 2: with Max, their streaming service. Yes, yes, so that's what
• 27:44
  Speaker 2: two years ago they decided, Hey, we're gonna get rid
• 27:48
  Speaker 2: of the HBO name that used to be attached to
• 27:51
  Speaker 2: our streaming service. It used to be called HBO Max.
• 27:54
  Speaker 2: We're going to get rid of the most powerful name
• 27:57
  Speaker 2: in legacy media in HBO and just rebrand the place Max.
• 28:03
  Speaker 2: I mean HBO, the the the channel that's associated the
• 28:07
  Speaker 2: brand that's associated with the Sopranos, Game of Thrones, Band
• 28:13
  Speaker 2: of Brothers, the Wire. I mean, I can go. You
• 28:16
  Speaker 2: look at like every list of premium TV that's out there,
• 28:19
  Speaker 2: and like the best shows ever made, half of them
• 28:23
  Speaker 2: are HBO shows and Warner Brothers Discovery. After like you know,
• 28:27
  Speaker 2: all the manipulations that ended up with them owning this
• 28:29
  Speaker 2: and a bunch of other streaming stuff, they said, no,
• 28:32
  Speaker 2: we're gonna we're gonna get rid of that name. Two
• 28:34
  Speaker 2: years ago, We're just gonna call it Max. And we
• 28:36
  Speaker 2: made fun of them for that. We said that was dumb.
• 28:39
  Speaker 2: We said, how could you possibly, you know, try to
• 28:41
  Speaker 2: kill off the most valuable legacy media name out there.
• 28:46
  Speaker 2: Well two years later, guess what, folks, they're bringing it back. Stuff.
• 28:51
  Speaker 2: They're bringing it back. Announcing today Warner Brothers Discovery is
• 28:55
  Speaker 2: going to be renaming their streaming platform HBO Max quote
• 29:00
  Speaker 2: the powerful growth we've seen in our global streaming services
• 29:04
  Speaker 2: built around the quality of our programming. Today, we are
• 29:07
  Speaker 2: bringing back HBO, the brand that represents the highest quality
• 29:10
  Speaker 2: and media. Oh you think, to further accelerate that growth
• 29:15
  Speaker 2: in the years ahead.
• 29:18
  Speaker 3: What a strange journey it's been.
• 29:21
  Speaker 4: Can you just imagine being a fly on the wall
• 29:23
  Speaker 4: during all of these meetings over the past two years.
• 29:26
  Speaker 4: Let's drop the HBO and just call it Max. Two
• 29:29
  Speaker 4: years later, well, let's put back the HBO so it
• 29:33
  Speaker 4: can go back to be an HBO.
• 29:34
  Speaker 2: Matt, Just dummies, How much dummies? How much time, effort
• 29:38
  Speaker 2: and money have they spent on something that.
• 29:43
  Speaker 1: Like?
• 29:43
  Speaker 2: Quite honestly, anyone with anyone who knows anything about brand
• 29:47
  Speaker 2: equity and like branding would have told you, hey, this
• 29:50
  Speaker 2: is a bad idea. I give them an ounce of
• 29:54
  Speaker 2: credit for realizing after two years, hey we made a
• 29:57
  Speaker 2: horrible mistake. Yeah, but our like, who were the people
• 30:02
  Speaker 2: to begin with that said this was a good idea.
• 30:06
  Speaker 3: That's why I was tournament point determined. Is does AT
• 30:09
  Speaker 3: and T have any hand in this?
• 30:11
  Speaker 2: Because they had Warner Brothers Discovery before this was after
• 30:15
  Speaker 2: the spinoffs got it. This was after and so HBO
• 30:22
  Speaker 2: Max while while they were under AT and T in
• 30:25
  Speaker 2: twenty nineteen, that's when this was created. And then as
• 30:29
  Speaker 2: Warner Brothers Discovery got spun out in everything, they decided
• 30:32
  Speaker 2: to rebrand it because.
• 30:34
  Speaker 3: Got it after that change, okay, you know, it was like, well,
• 30:36
  Speaker 3: we got to do something where to start fresh.
• 30:38
  Speaker 2: Sure, we're our own company now, we got to do
• 30:41
  Speaker 2: something here and low and behold, they did the wrong
• 30:44
  Speaker 2: something when the best thing to do would be nothing. So,
• 30:48
  Speaker 2: uh yeah, it's it.
• 30:51
  Speaker 3: Does seem like it's regardless of the name fiasco, it's
• 30:54
  Speaker 3: been turned around pretty well. Its profitability has increased by
• 30:57
  Speaker 3: about three billion, according to this nbcpiece for the last
• 31:01
  Speaker 3: two years, and they've got about twenty two million subscribers
• 31:04
  Speaker 3: added in the past year. They're trying for one hundred
• 31:06
  Speaker 3: and fifty million by the end of twenty twenty six.
• 31:10
  Speaker 2: I'm gonna go a step further on this within within
• 31:15
  Speaker 2: the next within the next two years, they're gonna get
• 31:19
  Speaker 2: rid of the Max HBO and it's just gonna be HBO.
• 31:23
  Speaker 2: What's this Max doing here? We don't need the Max.
• 31:26
  Speaker 2: Get rid of the Max.
• 31:28
  Speaker 3: It's kind of like how ESPN just re announced their
• 31:31
  Speaker 3: new streaming app coming out of the ESPN ESPN not ESPN.
• 31:35
  Speaker 2: This is what I'm saying, Yes, this is this is
• 31:37
  Speaker 2: where the zeitgeist is going now. Like for the last
• 31:39
  Speaker 2: few years, it's been Disney plus, HBO Max, Walmart plus,
• 31:44
  Speaker 2: OPEC plus, Like everyone's adding the plus. Netflix needs to
• 31:49
  Speaker 2: come out with a Netflix minus with all the ads
• 31:53
  Speaker 2: their ads. Next Netflix multiplication, you know, like it's just
• 31:59
  Speaker 2: ridiculous this point. So yeah, HBO Max is coming back,
• 32:05
  Speaker 2: which means they got to pay a bunch of money
• 32:07
  Speaker 2: to rebrand all this stuff and relabel it and you know,
• 32:10
  Speaker 2: rewatermark all the films and this and that. Like it's
• 32:13
  Speaker 2: it's just ridiculous. How much money do they spend just
• 32:16
  Speaker 2: doing this? My goodness, Let's take a quick break. When
• 32:20
  Speaker 2: we come back, we got stack Roulette. After this, Tara.
• 32:24
  Speaker 1: Spears continue to grip markets. Get the latest straight from
• 32:27
  Speaker 1: Wall Street right here on the Financial Exchange Radio Network.
• 32:32
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• 32:45
  Speaker 4: This segment of the Financial Exchange is brought to you
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• 33:16
  Speaker 2: Paul, what do you got for me? Pace?
• 33:18
  Speaker 3: Here from the Boston Globe, Chuck. If so many people
• 33:20
  Speaker 3: are leaving the state of Massachusetts, why aren't housing costs
• 33:24
  Speaker 3: going down?
• 33:25
  Speaker 2: Peace?
• 33:25
  Speaker 3: From the Globe this morning. Here where interesting piece where
• 33:30
  Speaker 3: details that we have seen domestically, US citizens who are
• 33:35
  Speaker 3: Massachusetts residents leave the state in pretty significant numbers over
• 33:38
  Speaker 3: the last several years. We saw fifty five thousand people
• 33:42
  Speaker 3: leave in twenty twenty two. In twenty twenty three, another
• 33:46
  Speaker 3: thirty six thousand depart, and then twenty seven thousand and
• 33:50
  Speaker 3: twenty twenty four. Again, some of that was offset by
• 33:53
  Speaker 3: we had people from other countries moving into the state
• 33:55
  Speaker 3: of Massachusetts, but just looking at us residents where they
• 33:59
  Speaker 3: were living, we saw a lot of people move out
• 34:00
  Speaker 3: of Massachusetts. And one of the things that happened was
• 34:03
  Speaker 3: obviously the state millionaire's tax was implemented during that period
• 34:06
  Speaker 3: of time. Some rumors out there that perhaps that would
• 34:09
  Speaker 3: drive people to leave. But we still find ourselves with
• 34:13
  Speaker 3: a house it significant housing shortage where more Healy has
• 34:17
  Speaker 3: set out a goal to build two hundred twenty two
• 34:20
  Speaker 3: thousand new homes over the next decade to try and
• 34:23
  Speaker 3: fix the housing shortage that Massachusetts finds itself in. Where
• 34:27
  Speaker 3: nationally you've seen actually a slight decline on single family
• 34:31
  Speaker 3: home prices, but in Massachusetts we saw an eleven percent
• 34:35
  Speaker 3: increase on single family homes and just interesting data that
• 34:39
  Speaker 3: we see here. Certainly on the building front, we're nowhere
• 34:41
  Speaker 3: near reaching that target two hundred and twenty two thousand,
• 34:45
  Speaker 3: there was about thirteen thousand of permits in twenty twenty three.
• 34:49
  Speaker 3: We're just nowhere near the pace. Massachusetts still in the
• 34:53
  Speaker 3: Greater Boston area has the lowest rental vacancy of all
• 34:56
  Speaker 3: the major cities. It just continues to be an issue
• 35:00
  Speaker 3: and I'm not here to sit and say that I
• 35:01
  Speaker 3: have a fix for it, but it is just fascinating
• 35:05
  Speaker 3: how significant of a shortage there is. And the other
• 35:08
  Speaker 3: thing that's mentioned this piece is this idea that there
• 35:11
  Speaker 3: are a lot of new households being formed millennials sort
• 35:14
  Speaker 3: of transitioning from living with their parents to developing their own.
• 35:18
  Speaker 2: Faith millennials anymore, some of the gen zers are stepping
• 35:21
  Speaker 2: up to the plant also, and you have a significant
• 35:24
  Speaker 2: part of the baby boomer generation which are going to
• 35:27
  Speaker 2: be theoretically occupying these suburban homes where the bedrooms won't
• 35:32
  Speaker 2: be entirely filled, but they won't necessarily be moving out
• 35:36
  Speaker 2: of those houses, which just creates potentially a further shorting
• 35:41
  Speaker 2: shortage on the housing front. I think Massachusetts can best
• 35:44
  Speaker 2: be summed up by former Yankees, Great Yogi Berra. Nobody
• 35:50
  Speaker 2: goes there anymore. It's too crowded. Yeah, you know, that's
• 35:54
  Speaker 2: that's kind of what it feels like. Yep. But one
• 35:58
  Speaker 2: thing this Boston Gold piece does make a good point
• 36:00
  Speaker 2: on this. You know, people say, well, look like if
• 36:02
  Speaker 2: people move out, then it won't be as crowded, and
• 36:04
  Speaker 2: you know the price of housing will go down. The
• 36:06
  Speaker 2: problem that you run into is We've yet to really
• 36:10
  Speaker 2: see any economy in the world succeed with a dwindling population,
• 36:18
  Speaker 2: because if you are losing population, especially if younger people
• 36:22
  Speaker 2: are moving out, you are losing future workers. And talk
• 36:26
  Speaker 2: to anyone who has even within Massachusetts, like talk to
• 36:29
  Speaker 2: some of the mill towns that were hollowed out over
• 36:32
  Speaker 2: the last fifty sixty years and what you've seen there
• 36:35
  Speaker 2: and how those communities have had to rebuild and kind
• 36:38
  Speaker 2: of reinvent themselves. It's not good when you have a
• 36:42
  Speaker 2: dwindling population because it usually means a lot of bad
• 36:45
  Speaker 2: things are going on. I'm not saying that we all
• 36:48
  Speaker 2: need to have eight kids, because any of you have
• 36:50
  Speaker 2: listened to the show repeatedly you know that. I don't really,
• 36:53
  Speaker 2: you know, think forcing people to have kids. I mean,
• 36:55
  Speaker 2: it's basically the worst thing ever. Like it's it's not
• 36:58
  Speaker 2: having kids, but like forcing people to have kids is
• 37:00
  Speaker 2: about as dehumanizing a thing as you can as dehumanizing
• 37:04
  Speaker 2: a thing as you can do. And so ultimately there's
• 37:08
  Speaker 2: a healthy balance that you need to have here. The
• 37:10
  Speaker 2: problem is we just have not built enough housing. And
• 37:14
  Speaker 2: some of that space related, some of that's regulation related. Uh,
• 37:17
  Speaker 2: some of it is we just as much as we
• 37:20
  Speaker 2: talk about wanting more housing, we don't actually want it
• 37:22
  Speaker 2: in our backyard. And we got to figure out how
• 37:24
  Speaker 2: to deal with that. And as Paul said, there's there's
• 37:26
  Speaker 2: no great answers to this, but uh, that's the that's
• 37:29
  Speaker 2: the deal. H New York Times piece, Your next Airbnb
• 37:32
  Speaker 2: may include room service and Tamali making. Hey uh so
• 37:36
  Speaker 2: in I'll quote here. In an announcement yesterday, uh Brian Chesky,
• 37:40
  Speaker 2: Airbnb's chief executive, said the company will offer the kinds
• 37:43
  Speaker 2: of services typically found at hotels, including room service, spot treatments,
• 37:47
  Speaker 2: and personal training, all bookable on Airbnb's redesigned app. Other
• 37:53
  Speaker 2: professional chefs salon treatments like hair, nails and makeup. So
• 37:57
  Speaker 2: they want to cut of this. So basically you agree, oh,
• 37:59
  Speaker 2: you know, beyond their app, and they get a cut
• 38:02
  Speaker 2: for you know, the booking. I'm sure professional chefs I
• 38:05
  Speaker 2: like that. I mean, it seems to be a fairly
• 38:07
  Speaker 2: low risk thing for them. It doesn't seem like there's
• 38:09
  Speaker 2: probably like a ton of overhead or a ton of expense.
• 38:13
  Speaker 2: How well it works, I don't know, but I don't know.
• 38:16
  Speaker 2: Kind of interesting to me. We're gonna take a quick
• 38:18
  Speaker 2: break for the entire rest of the day. I hope
• 38:20
  Speaker 2: you enjoy that rest of the day and we'll have
• 38:23
  Speaker 2: an even better show for you tomorrow, hopefully,