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Will the $100,000 visa help American workers? · The Financial Exchange Show

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  Speaker 2: Chuck Mike Tucker with you, kicking off another week on
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  Speaker 2: the Financial Exchange, and quite honestly, not gonna be a
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  Speaker 2: huge week. It's gonna be on a scale from one
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  Speaker 2: to ten, like a four and a half, maybe a five.
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  Speaker 3: So if you got a.
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  Speaker 2: Little bit of you know, overseating to do out in
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  Speaker 2: the yard, if you're starting to get the leaves all
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  Speaker 2: bagged up because hey, the trees are dumping them in
• 1:37
  Speaker 2: mid September, since we haven't gotten any rain in eight months,
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  Speaker 2: this is the.
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  Speaker 3: Week to do it.
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  Speaker 2: Not next week has been very pretty it has been,
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  Speaker 2: it has been, But this week we do still have
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  Speaker 2: a few things that we're gonna be paying attention to.
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  Speaker 2: Most notably, Jay Powell is gonna be speaking on Tuesday.
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  Speaker 2: Always interesting to hear what he has to say, and
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  Speaker 2: obviously it can be a market moving event. Thursday, we're
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  Speaker 2: going to be getting some existing home sales data as
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  Speaker 2: well as jobless claims for the week. And then on
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  Speaker 2: Friday we're gonna be getting PCE data, including the PCE
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  Speaker 2: Price Index, which is the Fed's preferred measure of inflation,
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  Speaker 2: and so that always has the potential to be a
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  Speaker 2: market moving event, though at this point everyone's so darn
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  Speaker 2: gooded backing into it because of the inputs from PPI
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  Speaker 2: and CPI that it's been a while since we've had
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  Speaker 2: a real PCE surprise where we've been like, oh, like,
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  Speaker 2: where did that come from?
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  Speaker 3: So I think.
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  Speaker 2: Overall, from a data perspective, not necessarily the most exciting week,
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  Speaker 2: but a couple interesting things that I always like to
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  Speaker 2: point out. First, it is the week after an options expiration,
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  Speaker 2: which tends to potentially jar things loose a little bit,
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  Speaker 2: so you've got the potential for a little bit of
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  Speaker 2: volatility that could be out there. Other things that you
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  Speaker 2: pay attention to. Last week, a bunch of corporate tax
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  Speaker 2: paid's we're doing so you had a bunch of money
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  Speaker 2: flowing into the US Treasury. Does that disrupt things from
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  Speaker 2: a liquidity perspective again, kind of mechanical under the surface,
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  Speaker 2: things that you know may or may not matter and
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  Speaker 2: probably aren't the most exciting, but still have the potential
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  Speaker 2: to contribute to, you know, a week that's out there.
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  Speaker 2: And then when we look on the earning side of things,
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  Speaker 2: a few companies that I think are worth paying attention to.
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  Speaker 2: Micron Technology reports earnings tomorrow, so we'll see what they say.
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  Speaker 2: It's been kind of a disappointing quarter for semiconductor earnings,
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  Speaker 2: but the sector as a whole has been fine, just
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  Speaker 2: because it continues to chug along somehow. And then on
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  Speaker 2: Thursday we got Costco reporting earnings. What do they tell
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  Speaker 2: us about how households are spending and what they're seeing
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  Speaker 2: in terms of trends. I think that'll be an interesting
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  Speaker 2: one too. You know, get some information on as well.
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  Speaker 2: In terms of unscheduled stuff. There's been plenty too.
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  Speaker 4: Obviously over the weekend we had the news on the
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  Speaker 4: H one B visas, which I was having dinner with
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  Speaker 4: people on Saturday night who affected there, so a lot
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  Speaker 4: of busy weekend emails going around there. You do have
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  Speaker 4: a loose what a Friday news dump? I know you've
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  Speaker 4: got a Friday news dump. You've got a very seemingly
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  Speaker 4: proposed TikTok deal that may be going forward sooner than
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  Speaker 4: anybody anticipated. And then you also have some pieces on
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  Speaker 4: looming government shutdowns, which will again it's Monday, so give
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  Speaker 4: it some time. That'll come to the very last second.
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  Speaker 4: But we are staring down a potential government shutdown here
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  Speaker 4: over the coming week or so, not to mention, Supreme
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  Speaker 4: Court is reviewing a number of cases from the Trump administration,
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  Speaker 4: and there's other stuff working its way through the courts
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  Speaker 4: as well. So we have the potential for more unscheduled
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  Speaker 4: news throughout the next couple weeks.
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  Speaker 2: And this is before we even get to the possibility
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  Speaker 2: of yet another Argentinian default. That is far from certain,
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  Speaker 2: and certainly the Argentinians are trying to manage things the
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  Speaker 2: best they can. But gosh, if you haven't been watching
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  Speaker 2: what was going on in Argentinian bonds over the last
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  Speaker 2: month or so, there's been, you know, some renewed interest,
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  Speaker 2: especially in the last week.
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  Speaker 3: When was the last one? Are we that overdue for
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  Speaker 3: Argentinian default? It's been more than like eighteen months?
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  Speaker 2: Hang on, give me just one second. I need to uh, okay,
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  Speaker 2: let's see. No, that one was from two thousand and five.
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  Speaker 2: Hang on, I gotta see when these have these have
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  Speaker 2: happened here? Let's see. Oh, this is just an article
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  Speaker 2: called Endless Defaults the Curious Case of Argentina. That sounds
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  Speaker 2: kind of fun.
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  Speaker 4: Google's AI was able to give me one, yep, one
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  Speaker 4: series of them between five and twenty ten, it was.
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  Speaker 2: Really one that was in multiple stages.
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  Speaker 4: Twenty fourteen, I don't remember, the country is declared in
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  Speaker 4: default by the ISDA because it could not pay holdout creditors.
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  Speaker 4: So it looks like that might have been looming from
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  Speaker 4: the twenty.
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  Speaker 2: Yeah, I don't remember that one.
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  Speaker 3: Twenty nineteen they failed to make payments.
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  Speaker 4: I do remember twenty nineteen, and then twenty twenty the
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  Speaker 4: again defaulted and restructured on their international five years.
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  Speaker 3: I mean, yeah, yeah, they're overdue.
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  Speaker 2: It's it sounds like we might be getting there. So
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  Speaker 2: there's a lot that is in the air. And this
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  Speaker 2: is even before you get to some of the other
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  Speaker 2: stuff that a lot of this is geopolitically related. You
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  Speaker 2: had Korea over the weekend. South Korea come out, you know,
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  Speaker 2: and basically say, hey, we're not really sure that we're
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  Speaker 2: gonna be able to do everything that you're you know,
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  Speaker 2: the US is trying to push for in UH its
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  Speaker 2: trade deal, and so it seems like things are kind
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  Speaker 2: of just coming to a head with a lot of
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  Speaker 2: geopolitical items, not in terms of any like conflicts or
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  Speaker 2: anything like that, but just hey, a lot of financial
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  Speaker 2: and economic items that you know, people have been watching
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  Speaker 2: for anywhere from you know, Argentina is one that Malay
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  Speaker 2: was elected what about a year and a half ago,
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  Speaker 2: I think, and had a really success for first year,
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  Speaker 2: but they're just running up against the balance of payment problems.
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  Speaker 2: That is not something that anyone in the US would
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  Speaker 2: probably understand because the United States has not had to
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  Speaker 2: deal with a balance of payments issue. In god, I
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  Speaker 2: can't even think of the last time that you would
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  Speaker 2: you have that item come up. So you know, this
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  Speaker 2: is one that's been brewing for maybe a year and
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  Speaker 2: a half. That again, six to eight months ago, things
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  Speaker 2: looked like they were humming along pretty well, and then
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  Speaker 2: over the course of really the last like eight weeks,
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  Speaker 2: it's kind of just taken a turn for the worse
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  Speaker 2: in Argentina. So you've got that that's been brewing for
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  Speaker 2: a year and a half. Again, the situation on trade
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  Speaker 2: with South Korea has been brewing for the last six
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  Speaker 2: months or so. The H one B visa thing just
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  Speaker 2: popped up now, But we've been talking about H one
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  Speaker 2: b's as long as I've been on this show, so
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  Speaker 2: I mean you're talking more than a decade at this point,
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  Speaker 2: So it's a lot of international items that I think,
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  Speaker 2: you know, maybe coming to a head this fall, and
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  Speaker 2: that can have, you know, some interesting repercussions in markets.
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  Speaker 2: But to this point, there's been nothing that's been able
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  Speaker 2: to knock markets off course in any meaningful fashion. Since
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  Speaker 2: mid April, We've had a few times here there where
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  Speaker 2: I've been like, oh, that's kind of interesting. Maybe something
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  Speaker 2: No hasn't metter crickets. It has not mattered. Let's talk
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  Speaker 2: about this H one B situation. What happened on Friday,
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  Speaker 2: Why are companies reacting the way they are, and what
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  Speaker 2: does it actually mean?
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  Speaker 4: So big announcement from the White House on Friday that
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  Speaker 4: was a little bit ambiguous at first.
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  Speaker 3: It basically said that.
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  Speaker 4: Every H one B visa holder will or the company
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  Speaker 4: sponsoring them will be responsible for one hundred thousand dollars
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  Speaker 4: fee going forward. That was at least initially interpreted as
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  Speaker 4: We're going to have to all come up with one
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  Speaker 4: hundred thousand dollars for anyone that is not yet in
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  Speaker 4: the country as of Sunday.
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  Speaker 2: So there was like you had emails going out being like, hey, please,
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  Speaker 2: if you are overseas, get back into the US right now.
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  Speaker 3: We're trugging the visa.
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  Speaker 4: Yeah, and so you had these calls going out on
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  Speaker 4: Friday evening across the country, sorry, across the globe. From
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  Speaker 4: these are largely big tech players, big fintech players that
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  Speaker 4: employ a lot of these some research H one B
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  Speaker 4: visas as well, but hey, figure this out, get back
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  Speaker 4: into the country, find the next flight as quickly as
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  Speaker 4: you can. The Trump administration then put out revised guide
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  Speaker 4: and say, no, this one hundred thousand dollars cost is
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  Speaker 4: only going to be for the new visa applications going forward.
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  Speaker 4: And so where this leaves things is that there is
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  Speaker 4: going to be, assuming this sticks, a tremendous amount of
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  Speaker 4: change going on with H one B visa holders over
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  Speaker 4: the course of the next twelve months. But I think
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  Speaker 4: we kind of have to start with the framework of
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  Speaker 4: who hires these people, why do they use this visa product,
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  Speaker 4: and what has it really become these days, because it has,
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  Speaker 4: to your points, Chuck, been something we've talked about at
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  Speaker 4: length of the last decade and has faced significant changes.
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  Speaker 4: You know, first under Trump administration one point oh, those
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  Speaker 4: changes were really seen during the Biden administration, and then
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  Speaker 4: you're now seeing this new change come twenty twenty five.
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  Speaker 2: So when we look at who is predominantly in terms
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  Speaker 2: of because here's the thing, there's two different groups that
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  Speaker 2: I think are worth talking about when it comes to
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  Speaker 2: H one B visas. Not two different groups, it's really
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  Speaker 2: two ways that you can break this down. There are
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  Speaker 2: the new visas that are issued each year, which are
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  Speaker 2: typically kept I think it's sixty five thousand, but there's
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  Speaker 2: an additional expansion of up to another twenty thousand beyond that,
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  Speaker 2: so you have about eighty five thousand new ones that
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  Speaker 2: could potentially be issued in any particular year.
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  Speaker 3: Yeah.
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  Speaker 4: The extra twenty five I think are four PhDs or
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  Speaker 4: master's degree or higher.
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  Speaker 2: So it's certain qualifications there are though, remember these are
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  Speaker 2: visas that can be rolled over and renewed on an
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  Speaker 2: annual basis. The estimates that are out there, because we
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  Speaker 2: don't have you know, full, you know, active day to
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  Speaker 2: day government statistics on this, estimated that there's around three
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  Speaker 2: quarters of a million active H one B visas that
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  Speaker 2: are currently out there. And beyond that, those three quarters
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  Speaker 2: of a million also have about five hundred to six
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  Speaker 2: hundred thousand dependents that they have brought with them into
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  Speaker 2: the United States. So you're talking probably somewhere in the
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  Speaker 2: range of like one point two to one point three
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  Speaker 2: million people that are living in the US on H
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  Speaker 2: one B visas, with about three quarters of a million
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  Speaker 2: people that are actively working on them and the rest
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  Speaker 2: are you know, spouses or children that are part of
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  Speaker 2: the family.
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  Speaker 4: Prior to twenty twenty one, the way this all worked
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  Speaker 4: is you would have to file as a company. You'd
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  Speaker 4: have to file this full petition with a whole bunch
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  Speaker 4: of documentation to apply for NH one B visa. The
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  Speaker 4: fees cost somewhere between five and twenty five thousand dollars
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  Speaker 4: per worker, meaning they're just there are still a lot
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  Speaker 4: of applications, but it was a pretty high bar to
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  Speaker 4: do that. The rules then changed at the end of
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  Speaker 4: twenty nineteen, completely changing how this all works, and effectively
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  Speaker 4: they reduce the registration fee to ten bucks, and they
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  Speaker 4: basically said it's going to be a lottery, and if
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  Speaker 4: you win the lottery, then you have to give us
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  Speaker 4: all the documentation and all the fees.
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  Speaker 2: Yes, so when we talk about, you know where this goes,
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  Speaker 2: the big questions are that are still out there, who
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  Speaker 2: exactly is going to pay this fee? Are there ways
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  Speaker 2: around it? Is it going to be every year? Like
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  Speaker 2: there still are things that are needing to be clarified.
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  Speaker 2: We get some of that over the weekend. Let's take
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  Speaker 2: a quick break and let's discuss more because this is
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  Speaker 2: again kind of a big potential shift that we could
• 12:43
  Speaker 2: be seeing here, and let's talk about exactly what we
• 12:47
  Speaker 2: know to this point.
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• 13:22
  Speaker 2: All right, let's continue our visa talk. This is related
• 13:25
  Speaker 2: to immigration, not credit cards. And basically this one hundred
• 13:29
  Speaker 2: thousand dollars fee on H one B visas. The administration
• 13:33
  Speaker 2: did clarify over the weekend that this would be just
• 13:37
  Speaker 2: for new visas, not for renewals. Yes, that still was
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  Speaker 2: enough to spare a bunch of people, you know, a
• 13:42
  Speaker 2: whole bunch of chaos over the weekend because you know,
• 13:44
  Speaker 2: no one knew what was going on until I think
• 13:47
  Speaker 2: late Saturday is when the clarification was issued on this.
• 13:52
  Speaker 2: In terms of who who's in the US on H
• 13:55
  Speaker 2: one B visas, we don't have, you know, exactly up
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  Speaker 2: to date data on this, but Pew Research went out
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  Speaker 2: and did a study on it. They found that seventy
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  Speaker 2: three percent of H one B workers who were approved
• 14:10
  Speaker 2: in twenty twenty three were born in India, so three
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  Speaker 2: quarters of them approximately are from India, and a majority
• 14:18
  Speaker 2: of approvals each year since twenty ten has gone to
• 14:21
  Speaker 2: workers born in India. China is the second most common
• 14:24
  Speaker 2: with about twelve percent. No other birthplace accounted for even
• 14:29
  Speaker 2: two percent of H one B workers. So couple different
• 14:34
  Speaker 2: ways to read this, and quite honestly, I think there's
• 14:39
  Speaker 2: only one that really matters. This is between the United
• 14:42
  Speaker 2: States and India in terms of money.
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  Speaker 3: Which is also why I'm not sure that this sticks, right.
• 14:50
  Speaker 4: I Mean, there's no reason that I can think of
• 14:54
  Speaker 4: to say that this isn't a negotiating point with US
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  Speaker 4: in India, right, I wouldn't this be on the table
• 15:01
  Speaker 4: should they get to the bargaining table when it comes
• 15:03
  Speaker 4: to tariffs and all.
• 15:05
  Speaker 3: Other sorts of things.
• 15:07
  Speaker 4: The way that these visa programs have I am not
• 15:12
  Speaker 4: creating the wheel on this. I found a pretty good
• 15:15
  Speaker 4: piece by Michael Green, who's a chief strategist and portfolio
• 15:20
  Speaker 4: manager for a Simplify asset management.
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  Speaker 3: And he pointed a few things out.
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  Speaker 4: One since that change in twenty nineteen, the system has
• 15:28
  Speaker 4: kind of changed in terms of how it works and
• 15:30
  Speaker 4: what it's become now is, at least in his opinion,
• 15:35
  Speaker 4: a really easy opportunity for staffing firms to flood the
• 15:39
  Speaker 4: system with a bunch of applications and then put these
• 15:42
  Speaker 4: people into roles at Google, at Microsoft, at these other
• 15:46
  Speaker 4: companies to basically offer wages at a far lower rate
• 15:50
  Speaker 4: than what you'd be able to hire for the same
• 15:51
  Speaker 4: thing in the United States.
• 15:52
  Speaker 2: Which is why a lot of people that have looked
• 15:54
  Speaker 2: at the H one B visa program have said, Look,
• 15:56
  Speaker 2: if you're going to allow for these unlimited applications with NOSE,
• 16:01
  Speaker 2: don't make it a lottery system. Make it an auction
• 16:04
  Speaker 2: system where it's Hey, if you are Google and you're
• 16:07
  Speaker 2: bidding on a role, if you don't put enough up
• 16:10
  Speaker 2: as a salary for that role, you're going to get
• 16:14
  Speaker 2: outbid and not get the worker.
• 16:16
  Speaker 4: In twenty twenty one, there were two hundred and sixty
• 16:18
  Speaker 4: nine thousand applications in twenty twenty four, there's seven hundred
• 16:22
  Speaker 4: fifty nine thousand.
• 16:23
  Speaker 2: It's a big increase.
• 16:25
  Speaker 4: So what you seem to be seeing here are big
• 16:28
  Speaker 4: consultancy firms getting this, putting the people into the workplaces
• 16:34
  Speaker 4: at a subsidized rate, and then kind of pocketing the
• 16:37
  Speaker 4: difference here. And those are the ones that are really
• 16:39
  Speaker 4: hurt by all of this is those consulting staffing firms
• 16:43
  Speaker 4: that placed a lot of these folks into those roles. Yes,
• 16:46
  Speaker 4: Google and Microsoft are going to struggle, but quite honestly.
• 16:49
  Speaker 2: They can figure out how to pay the extra cash.
• 16:51
  Speaker 4: They've got the deep pockets to be able to do this.
• 16:53
  Speaker 4: These are not American farmers who are struggling going to
• 16:55
  Speaker 4: figure out, Hey, if I have to hire an American
• 16:57
  Speaker 4: worker to plant the field, how much more am I
• 16:59
  Speaker 4: going to have to pay?
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  Speaker 2: So an extra couple hundred grand for each of these
• 17:03
  Speaker 2: employees is a rounding error on Microsoft's bottom line, right.
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  Speaker 4: And you know, Michael pointed out a few things. One,
• 17:10
  Speaker 4: he pulled the average hourly earnings of all employees in
• 17:14
  Speaker 4: information in information roles and looked at them since twenty
• 17:18
  Speaker 4: twenty and he pointed out what he considers to be
• 17:20
  Speaker 4: a statistically significant drop in incomes in that specific area
• 17:24
  Speaker 4: that he at least in part, blames on this. I'm
• 17:26
  Speaker 4: sure you could blame it on other things too, But again,
• 17:30
  Speaker 4: I just find this interesting, and I tend to agree, Hey,
• 17:36
  Speaker 4: a rather than a lottery based system, a system where
• 17:42
  Speaker 4: you just go to the highest bidder, I think makes
• 17:45
  Speaker 4: some sense in the absence of that, I don't know.
• 17:48
  Speaker 4: I'll be interested to see how this plays out. I
• 17:50
  Speaker 4: do think that there are gives and takes with this.
• 17:53
  Speaker 4: There will be companies that say, Okay, great, I'm just
• 17:55
  Speaker 4: going to go and employ that India worker Indian worker
• 17:58
  Speaker 4: in India. But they might also create a more efficient
• 18:03
  Speaker 4: system with all this. That said, I also think there's
• 18:06
  Speaker 4: a distinct possibility that that we are back to the
• 18:08
  Speaker 4: twenty nineteen rules in a couple of years if we
• 18:11
  Speaker 4: get a trade deal done with India.
• 18:14
  Speaker 2: I'm trying to make heads heads or tails of the
• 18:18
  Speaker 2: whole US India relationship right now, good luck, and I'm
• 18:22
  Speaker 2: kind of struggling with it because as recently as like
• 18:25
  Speaker 2: April or may you know, Vice President Vance had just
• 18:28
  Speaker 2: headed over to India, said, you know, had a very
• 18:31
  Speaker 2: successful meeting in India with the Indian government, and it
• 18:36
  Speaker 2: seems like things were really moving along in a productive fashion.
• 18:41
  Speaker 2: I don't know what happened between kind of May and
• 18:47
  Speaker 2: early August, but something did, yeah, and I don't know
• 18:53
  Speaker 2: what because things have not been good between the two
• 18:55
  Speaker 2: countries since then. I'm not saying that they've been like bad,
• 18:58
  Speaker 2: but things have been taking step back as far as
• 19:00
  Speaker 2: what you would think of as constructive progress in a
• 19:03
  Speaker 2: number of areas.
• 19:05
  Speaker 4: And this is another shot across that bow because again,
• 19:09
  Speaker 4: this is predominantly an issue that affects Indian workers.
• 19:13
  Speaker 3: It is I'm an Indian company.
• 19:14
  Speaker 2: I'm just trying to figure out what is needed in
• 19:18
  Speaker 2: order to get across that hump and get a resolution there.
• 19:22
  Speaker 2: Let's take a quick break. When we return, we got
• 19:26
  Speaker 2: Wall Street Watch and they were talking college after this.
• 19:41
  Speaker 1: Like us on Facebook and follow us on Twitter at
• 19:44
  Speaker 1: TFE show. Breaking business news is always first right here
• 19:48
  Speaker 1: on the Financial Exchange Radio Network. Time now for Wall
• 19:54
  Speaker 1: Street Watch. A complete look at what's moving markets so
• 19:57
  Speaker 1: far today right here on the Financial Exchange Radio Network.
• 20:01
  Speaker 5: Markets are a little changed to kick off a new
• 20:04
  Speaker 5: week after the FED reduced interest rates last week. Investors
• 20:08
  Speaker 5: are also weighing the looming thread of a potential government
• 20:11
  Speaker 5: shutdown after a bill was rejected on Friday, and later
• 20:14
  Speaker 5: this week we'll get another measure on the inflation front
• 20:17
  Speaker 5: when the Personal Consumption Expenditures Price Index is posted. Right now,
• 20:23
  Speaker 5: the Dow is down by a tenth of a percent
• 20:26
  Speaker 5: or sixty eight points. SMP five hundred edging three points higher,
• 20:31
  Speaker 5: NASDAC up nearly two tenths of one percent or forty
• 20:34
  Speaker 5: two points. Russell two thousand is down about a tenth
• 20:37
  Speaker 5: of a percent. Ten year treasureal flat and is currently
• 20:40
  Speaker 5: at four point one four to one percent. Crude oiled
• 20:44
  Speaker 5: down about seven tenths of one percent, rating at sixty
• 20:47
  Speaker 5: two dollars in twenty three cents a barrel. Some merger
• 20:51
  Speaker 5: news in the real estate space this morning. After Compass
• 20:54
  Speaker 5: agreed to acquire Anywhere Real Estate for one point six
• 20:59
  Speaker 5: billion dollars. COMPA shares are down about nine percent, while
• 21:03
  Speaker 5: Anywhere real Estate stock is surging about fifty nine percent. Meanwhile,
• 21:09
  Speaker 5: Pfizer agreed to pay up to seven point three billion
• 21:12
  Speaker 5: dollars for anti obesity drug maker Metzerah. Pfizer stock is
• 21:18
  Speaker 5: up over two percent on that news. Elsewhere Washington Post
• 21:21
  Speaker 5: is reporting that the Trump administration plans to announce today
• 21:25
  Speaker 5: that pregnant woman's use of Thailand Hall is potentially linked
• 21:29
  Speaker 5: to autism. Shares in tailentholl parent company ken View are
• 21:32
  Speaker 5: sinking nearly six percent on that news. Fox is up
• 21:36
  Speaker 5: by about two percent after President Trump yesterday said the
• 21:39
  Speaker 5: Murdochs are likely to be involved in the deal to
• 21:42
  Speaker 5: save TikTok in the US. Morgan Stanley upgraded Applied Materials
• 21:46
  Speaker 5: to overweight from equal weight, where the bank noted that
• 21:49
  Speaker 5: the chip maker trades at an attractive valuation relative to peers.
• 21:53
  Speaker 5: Applied Material shares are up about three percent, and Warren
• 21:57
  Speaker 5: Buffett's Berkshire Hathaway completely exited its investment in Chinese ev
• 22:01
  Speaker 5: maker BYD. Berkshire made its initial purchase seventeen years ago
• 22:07
  Speaker 5: at the urging of Charlie Munger. I'm Tucker Silva, and
• 22:10
  Speaker 5: that is Wall Street Watch.
• 22:12
  Speaker 4: Can we just say anywhere real estate is a bad
• 22:14
  Speaker 4: name for a real estate company.
• 22:18
  Speaker 3: One, it's just not creative. Two what's it is creative?
• 22:22
  Speaker 3: What's real estate all about? Location? Location? That's why it's creative.
• 22:28
  Speaker 2: It's also if you do want to make a case
• 22:30
  Speaker 2: it's horrible because if you try to run a search
• 22:33
  Speaker 2: engine for it, you just get yeah, all kinds of
• 22:36
  Speaker 2: random stuff, which is why I think that here's one
• 22:40
  Speaker 2: thing that I will say. You know how we rip
• 22:42
  Speaker 2: on companies for coming up with names that like don't
• 22:44
  Speaker 2: make any sense.
• 22:45
  Speaker 3: Yeah, it's better than putting a plus next to every product.
• 22:49
  Speaker 2: Or just like using a word as your thinking. Like
• 22:52
  Speaker 2: let's say that you sell barbecue stuff. If you put
• 22:57
  Speaker 2: down like barbecue stuff as your business name or like
• 23:03
  Speaker 2: beef barbecue, no one can find you online because it's
• 23:08
  Speaker 2: impossible to until like your brand is built up to
• 23:10
  Speaker 2: the point where you're the number one search result.
• 23:12
  Speaker 4: I also prefer it over a company like Vernova, who
• 23:15
  Speaker 4: just makes up a word that doesn't exist and.
• 23:17
  Speaker 2: No, see, I think the made up word is the
• 23:18
  Speaker 2: way you have to go into I've changed my tune
• 23:21
  Speaker 2: on this for a couple of reasons. The first is
• 23:24
  Speaker 2: the one that I just said. The second mic all
• 23:26
  Speaker 2: words are made up, Yeah they are, But we make
• 23:31
  Speaker 2: up words on the financial exchange all the time. Yeah,
• 23:34
  Speaker 2: there's a reason why everyone walks around saying below to
• 23:37
  Speaker 2: Now there's a reason why people say, what was the
• 23:41
  Speaker 2: transitory one that we had, oh, intermediatory, there's a reason
• 23:45
  Speaker 2: why that's in the lexicon now, and people are, you know,
• 23:49
  Speaker 2: speaking this on a regular basis. I'm mostly talking to myself,
• 23:54
  Speaker 2: which is why I hear these words so often. Let's
• 23:57
  Speaker 2: talk a little bit about what we're seeing in colleges
• 23:59
  Speaker 2: right now, specifically as it relates to international students. Colleges
• 24:04
  Speaker 2: love wealthy international students.
• 24:07
  Speaker 3: They do. They pay full boat. They pay full boat.
• 24:10
  Speaker 2: They again they definitely need housing, correct, And so basically
• 24:15
  Speaker 2: it's hey, if you are a college that is trying
• 24:18
  Speaker 2: to figure out how to you know, make the P
• 24:21
  Speaker 2: and L look decent, full boat international students have historically,
• 24:26
  Speaker 2: for the last thirty forty years been the way to go.
• 24:29
  Speaker 3: Yep.
• 24:30
  Speaker 2: And the question now is, hey, you had in the
• 24:33
  Speaker 2: twenty twenty three to twenty four school year a record
• 24:37
  Speaker 2: one point one million international students in US colleges, which
• 24:42
  Speaker 2: is again like a huge number. They contributed approximately forty
• 24:46
  Speaker 2: three point eight billion dollars to the US economy through
• 24:49
  Speaker 2: their combination of tuition, food, and living expenses. This is
• 24:53
  Speaker 2: according to NAFSA. I don't know what NAFSA stands for,
• 24:59
  Speaker 2: says AFSA, colan Association of it International educators. So part
• 25:04
  Speaker 2: of it is an acronym and part of it spelled out.
• 25:07
  Speaker 2: So I don't know what that means. Does it mean anything?
• 25:15
  Speaker 3: I'm working on it.
• 25:16
  Speaker 2: Okay, you're seeing the same thing I'm seeing. It's like,
• 25:20
  Speaker 2: how do you spell out part of the name but
• 25:22
  Speaker 2: not all of it? Yeah, Anyways, what you're seeing now
• 25:27
  Speaker 2: is the question of not so much the students that
• 25:29
  Speaker 2: are already in the US that have questions about you know,
• 25:33
  Speaker 2: their visa, immigration or things like that, but the ones
• 25:36
  Speaker 2: that are applying for subsequent years are saying, hey, is
• 25:42
  Speaker 2: it worth it for me to come to the US
• 25:44
  Speaker 2: given that there may be questions about my visa or
• 25:47
  Speaker 2: legal status or things along those lines, And does that
• 25:50
  Speaker 2: present potentially present an impact not just to the colleges,
• 25:54
  Speaker 2: which obviously would hurt dramatically, but to the broader US
• 25:59
  Speaker 2: economy as a result of that.
• 26:00
  Speaker 4: The NASA stance for the National Association of Foreign Student Advisors, just.
• 26:05
  Speaker 3: So you know, there we go.
• 26:06
  Speaker 4: Yeah, I mean, look, foreign students in our schools, I
• 26:10
  Speaker 4: think we should just like actually ask about the impact.
• 26:13
  Speaker 4: Right As a student, you probably appreciate that too. The
• 26:18
  Speaker 4: financial aid that is provided to you is in part
• 26:22
  Speaker 4: kind of being subsidized by not in part it is
• 26:25
  Speaker 4: directly being subsidized by these foreign students. I think there's
• 26:29
  Speaker 4: a few very legitimate questions, like, hey, should we have
• 26:33
  Speaker 4: national security concerns about students from Iran and China coming
• 26:38
  Speaker 4: to the US and studying things like physics and engineering
• 26:43
  Speaker 4: and all all sorts of one, Like, yes, we should
• 26:46
  Speaker 4: absolutely have those concerns. I would also ask, should the
• 26:51
  Speaker 4: United States have a policy of educating the world students
• 26:56
  Speaker 4: and then giving them absolutely no path to stay in
• 26:58
  Speaker 4: our country and be contributing members to our workforce. I
• 27:03
  Speaker 4: think we have some pretty bad policy when it comes
• 27:05
  Speaker 4: to retaining PhD students for instance, or you know, students
• 27:10
  Speaker 4: of any sort to incentivize them to stay in the
• 27:12
  Speaker 4: United States and be productive.
• 27:13
  Speaker 3: And work here, to.
• 27:17
  Speaker 2: Be honest, okay, And then I think there's convincing cases
• 27:22
  Speaker 2: both ways. Okay, convincing case for Hey, if you get
• 27:26
  Speaker 2: a university degree in the United States, should that, you know,
• 27:31
  Speaker 2: put you on a path towards you know, permanent resident
• 27:34
  Speaker 2: eventually citizen status because of what you said, Like, hey,
• 27:38
  Speaker 2: basically the way it's structured right now, I forget what
• 27:41
  Speaker 2: the exact time from is I don't know if it's like,
• 27:42
  Speaker 2: within five or ten years, you basically either have to
• 27:45
  Speaker 2: get married to someone who's a US citizen or you
• 27:48
  Speaker 2: can't live in the United States anymore. So there is
• 27:51
  Speaker 2: a convincing case to be made that, Okay, should we
• 27:53
  Speaker 2: find some way to put you on you know, permanent
• 27:55
  Speaker 2: residence status in the event that you graduate from a
• 27:58
  Speaker 2: US university, Probably, like we could talk about how to
• 28:02
  Speaker 2: figure that out. The other case that I do find
• 28:05
  Speaker 2: persuasive though, is, look, if you're educated in the United
• 28:09
  Speaker 2: States and you spend four years there and you have
• 28:10
  Speaker 2: a great time, You then go back to your home
• 28:13
  Speaker 2: country and you have all of these new American ideas
• 28:17
  Speaker 2: there and you help to spread that throughout the world
• 28:19
  Speaker 2: as well. Yeah, do I think that the default should
• 28:22
  Speaker 2: be that you get forced to do that?
• 28:25
  Speaker 3: Maybe not.
• 28:25
  Speaker 2: And maybe that's where it's like, Okay, can we figure
• 28:27
  Speaker 2: out how to strike a balance there, because I know
• 28:32
  Speaker 2: for a fact there are a number of international students
• 28:36
  Speaker 2: that I went to school with that we're not able
• 28:39
  Speaker 2: to stay in the United States full time permanently.
• 28:43
  Speaker 4: I guess that's a larger conversation about our type of
• 28:45
  Speaker 4: immigration system. And you know, We've never in the United States,
• 28:49
  Speaker 4: you correct, used like a points or merit based other
• 28:54
  Speaker 4: than a few niches, never used at full points based
• 28:56
  Speaker 4: or merit based immigration policy, and so that that's a
• 28:59
  Speaker 4: larger quest question. But there's nothing about this actual policy
• 29:04
  Speaker 4: coming from the White House that is changing all this.
• 29:06
  Speaker 3: It is really a few things.
• 29:08
  Speaker 4: One, it is more scrutiny of visa applicants, and there
• 29:12
  Speaker 4: was a period of time where they in fact shut
• 29:14
  Speaker 4: down all of that as they were trying to figure
• 29:15
  Speaker 4: out how do we do social media review of applicants.
• 29:18
  Speaker 3: And so that stressed out universities.
• 29:20
  Speaker 4: And then I think there's just a general, like you said,
• 29:24
  Speaker 4: concern on the part of applicants say, hey, okay, if
• 29:27
  Speaker 4: I get this visa, will I be able to retain it?
• 29:29
  Speaker 4: Because I can't imagine pouring one hundred thousand dollars a
• 29:32
  Speaker 4: year into Harvard University and not being able to finish
• 29:34
  Speaker 4: my degree there. That would be a poor investment on
• 29:37
  Speaker 4: my part. So am I better off trying to go
• 29:39
  Speaker 4: to the UK or somewhere else where. I'm quite certain
• 29:41
  Speaker 4: that I will be able to finish that education.
• 29:43
  Speaker 2: To take a quick break here. When we come back,
• 29:45
  Speaker 2: we'll talk a little bit about the Federal Reserve and
• 29:49
  Speaker 2: should they have a dual mandate or not.
• 29:53
  Speaker 1: The Financial Exchange streams live on YouTube. Subscribe to our
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• 30:00
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• 30:08
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  Speaker 2: Ed yard Any published a piece in the Financial Times
• 31:02
  Speaker 2: on September eighteenth. It's titled why it might be time
• 31:06
  Speaker 2: to repeal the Fed's dual mandate. And this is something
• 31:08
  Speaker 2: that Mark Fandetti actually talked about on this show in
• 31:12
  Speaker 2: the week prior. So we do have to wonder, is
• 31:15
  Speaker 2: at an avid Financial Exchange listener, because look, he's you know,
• 31:20
  Speaker 2: a really smart guy, but sometimes you know, you just
• 31:23
  Speaker 2: got to listen to Mark Fandetti in order to get
• 31:26
  Speaker 2: these ideas in your head. But the concept here here
• 31:29
  Speaker 2: is yes, thank you, thank you, Mark, I appreciate your
• 31:32
  Speaker 2: thoughts on the Federal Reserve. The thought that you had
• 31:36
  Speaker 2: any outlines here is basically, look, the FED has an
• 31:41
  Speaker 2: inflation rate that they try to target. They don't have
• 31:43
  Speaker 2: an explicit target for the unemployment right because it's simply
• 31:46
  Speaker 2: full employment, which they admit is a moving target. But
• 31:50
  Speaker 2: the question is, look, is this dual mandate causing more
• 31:56
  Speaker 2: problems than it solves, because in the case of what
• 32:00
  Speaker 2: Jay Powell said last week, he is like, look, both
• 32:02
  Speaker 2: sides of this are not moving in a great direction,
• 32:05
  Speaker 2: and the FED right now is choosing, as they noted,
• 32:08
  Speaker 2: as j Powell said, to lower rates because they're more
• 32:12
  Speaker 2: nervous about the employment side of the equation which your
• 32:16
  Speaker 2: denty points out. Look, maybe that presents some problems for
• 32:19
  Speaker 2: trying to get inflation to where you want to be,
• 32:22
  Speaker 2: And now you've got both sides that are stuck in
• 32:25
  Speaker 2: a bad place longer term.
• 32:27
  Speaker 4: I'm just trying to think through what the likely different
• 32:31
  Speaker 4: policy would be if the FED did not have this
• 32:34
  Speaker 4: dual mandate. Let's say, okay, great question, right, like, what
• 32:38
  Speaker 4: would be they be doing differently right now where they're
• 32:41
  Speaker 4: no dual mandate?
• 32:42
  Speaker 2: If the FED were only concerned about inflation right now.
• 32:46
  Speaker 3: Let's do both sides.
• 32:46
  Speaker 4: Is that even what he is arguing that they should
• 32:49
  Speaker 4: only be worried about inflation, because your denty seems to
• 32:51
  Speaker 4: be also arguing that, no, they should just be worried
• 32:54
  Speaker 4: about financial stability or monetary stability.
• 32:59
  Speaker 3: Really, isn't he?
• 33:03
  Speaker 2: Maybe I think monetary stability is getting at the inflation side.
• 33:07
  Speaker 3: Yeah, certainly more than the unemployment scenario.
• 33:10
  Speaker 2: But let's take let's take all three of these just
• 33:12
  Speaker 2: as an example. So if the FED were only concerned
• 33:16
  Speaker 2: about the labor market, they're cutting right now, because they're
• 33:22
  Speaker 2: cutting right now even though they're supposed to be concerned
• 33:24
  Speaker 2: about both. If the FED were only concerned about monetary stability, meaning,
• 33:30
  Speaker 2: you know, again just state like the proper functioning of
• 33:34
  Speaker 2: the monetary system and making sure things don't get too
• 33:36
  Speaker 2: out of whack. Could he make a case that they
• 33:39
  Speaker 2: should be doing nothing right now? Absolutely? Could he make
• 33:42
  Speaker 2: a case they should be cutting right now. I don't
• 33:45
  Speaker 2: think so. Could you make a case that they should
• 33:48
  Speaker 2: be hiking right now? Maybe, but the most likely thing
• 33:52
  Speaker 2: would be they do nothing. If the FED were only
• 33:55
  Speaker 2: concerned about inflation, they're probably hiking today. Again, even J.
• 34:00
  Speaker 2: Powell said, look like, both sides of this are moving indirections.
• 34:03
  Speaker 2: We don't like it's just the unemployment sides moving faster.
• 34:07
  Speaker 2: So I think that's.
• 34:10
  Speaker 4: My concern about doing away with this dual mandate is
• 34:13
  Speaker 4: that then leaves Congress to deal more with moments of
• 34:20
  Speaker 4: the problem is that Havoc and the Congress, what they
• 34:23
  Speaker 4: have done over the last fifty years has been to
• 34:27
  Speaker 4: give the FED more and more control over the financial system,
• 34:31
  Speaker 4: in my view, because they don't want to deal with
• 34:32
  Speaker 4: it on their own, they don't know how, they don't
• 34:34
  Speaker 4: think they have the abilities, and so they just say, hey,
• 34:36
  Speaker 4: let's give the FED more power so that we don't
• 34:39
  Speaker 4: have to We don't have to worry about this stuff
• 34:41
  Speaker 4: and deal with it. That's what happened after eight That's
• 34:43
  Speaker 4: what happened in twenty twenty. Is they have yielded more
• 34:46
  Speaker 4: power to the FED in a lot of different ways,
• 34:50
  Speaker 4: and I'm sure they're pluses and minuses.
• 34:54
  Speaker 2: Of well, a few different things can be true. The
• 34:56
  Speaker 2: first is, if you're not good at something, delegating it
• 35:00
  Speaker 2: to someone else is generally a good idea.
• 35:02
  Speaker 3: Sure.
• 35:04
  Speaker 2: The problem is the FED doesn't really have the tools
• 35:07
  Speaker 2: needed to deal with this right without its.
• 35:10
  Speaker 4: Congress holds the tools and FED holds the knowledge, but
• 35:14
  Speaker 4: they're not really allowed to influence each other by tradition.
• 35:17
  Speaker 2: And to a certain extent, the FED is kind of like, hey,
• 35:21
  Speaker 2: you're sick, so let's put some leeches on you. You know, like, yes,
• 35:25
  Speaker 2: it may end up, you know, solving the problem, but
• 35:28
  Speaker 2: it's also, you know, kind of this. Look, the prescription
• 35:32
  Speaker 2: for dealing with inflation is let's throw a recession in
• 35:35
  Speaker 2: the works. Yeah that's not really great. It might technically work,
• 35:40
  Speaker 2: but it doesn't really make you feel warm and fuzzy
• 35:44
  Speaker 2: about it.
• 35:44
  Speaker 4: I guess, folks, if you are interested in this seeming
• 35:49
  Speaker 4: turning point, that the economy is sitting at If you're
• 35:52
  Speaker 4: interested in the fact that markets keep reaching all time
• 35:54
  Speaker 4: highs and more and more comparisons are being made to
• 35:56
  Speaker 4: the dot com bubble, or you're intrigued to see how
• 35:59
  Speaker 4: AI seems to be shaping the market at every junction,
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• 37:01
  Speaker 1: any Armstrong guide a specific financial, legal, or tax advice.
• 37:04
  Speaker 1: Consult your own financial tax into state planning advisors before
• 37:07
  Speaker 1: making any investment decisions. Armstrong may contact you to offer
• 37:10
  Speaker 1: investment advisory services.
• 37:11
  Speaker 4: We didn't quite finish that conversation about the Fed. We've
• 37:15
  Speaker 4: talked about this over and over. The Fed has very
• 37:19
  Speaker 4: blunt tools when it comes to solving these problems, and
• 37:22
  Speaker 4: that is the problem with Congress having delegated more and
• 37:25
  Speaker 4: more responsibility of this stuff over to the Fed. They
• 37:29
  Speaker 4: have no real tools to increase employment in the country.
• 37:33
  Speaker 2: No, the FED cannot produce jobs or workers.
• 37:36
  Speaker 4: There are many who would say that raising interest rates
• 37:40
  Speaker 4: is not the most direct or effective way to control
• 37:43
  Speaker 4: runaway inflation. Tax rates could be better at that. There
• 37:46
  Speaker 4: are other things that could be better at controlling inflation
• 37:49
  Speaker 4: than moving interest rates. But this is the responsibility that
• 37:52
  Speaker 4: Congress has delegated to the Fed over the years, and
• 37:56
  Speaker 4: it's a reasonable question to ask if it is too
• 37:59
  Speaker 4: much for one organization to handle.
• 38:02
  Speaker 2: Let's take a quick break here. We still got another
• 38:04
  Speaker 2: hour coming up, so stay tuned. We're talking housing. We
• 38:08
  Speaker 2: are talking see what else, Oh TikTok. We got some
• 38:12
  Speaker 2: information there, and we're talking cardboard boxes. Yeah, not just
• 38:17
  Speaker 2: for your kids to play and after they open their toys.
• 38:20
  Speaker 2: We'll touch on that when we're back