Latest / The Financial Exchange Show / Is the Magnificent Seven no longer magnificent?

Transcript

Is the Magnificent Seven no longer magnificent? · The Financial Exchange Show

0:01
Speaker 1: The Financial Exchange is produced by Money Matters Radio and
0:04
Speaker 1: is hosted by employees of the Armstrong Advisory Group, a
0:06
Speaker 1: registered investment advisor. All opinions expressed are solely those of
0:09
Speaker 1: the hosts. Do not reflect the opinions of Armstrong Advisory
0:12
Speaker 1: or anyone else. Investments can lose money. This program does
0:15
Speaker 1: not offer any specific financial or investment advice. Please consult
0:18
Speaker 1: your own financial, tax, and estate planning advisors before making
0:21
Speaker 1: any investment decisions. Armstrong Advisory and the advertisers heard on
0:24
Speaker 1: this program do not endorse each other or their services.
0:27
Speaker 1: Armstrong and Money Matters Radio do not compensate each other
0:29
Speaker 1: for referrals and are not affiliated. This is the Financial
0:35
Speaker 1: Exchange with Chuck Sada and Paul Lane, your exclusive look
0:39
Speaker 1: at business and financial news affecting your day, your city,
0:43
Speaker 1: your world. Stay informed and up to date about economic
0:47
Speaker 1: and market trends, plus branking business news every day. The
0:51
Speaker 1: Financial Exchange is a proud partner of the Disabled American
0:54
Speaker 1: Veterans Department of Massachusetts. Help us support our great American
0:58
Speaker 1: heroes by visiting das V five K dot Boston and
1:02
Speaker 1: making a donation today. This is the Financial Exchange with
1:06
Speaker 1: Chuck Zada and Paul Lane.
1:11
Speaker 2: It is the second hour of our Friday show. Here
1:15
Speaker 2: closing out the week, we got markets rallying for the
1:19
Speaker 2: first time, really, I mean, this is probably the first
1:22
Speaker 2: time since the last Friday that we've had any kind
1:25
Speaker 2: of convincing rally. Monday was a puke day, Tuesday was
1:29
Speaker 2: a puke day. Wednesday looked like we were gonna rally
1:31
Speaker 2: ended up not Thursday puke day.
1:35
Speaker 3: Today.
1:36
Speaker 2: Thus far, through the first hour and a half of trading,
1:38
Speaker 2: things look good. But these are volatile days. I mean,
1:41
Speaker 2: you look at how this market has moved, Paul, and
1:43
Speaker 2: basically every day this week we've had multiple one percent
1:46
Speaker 2: intra day swings that have happened. And so just because
1:49
Speaker 2: we're sitting here saying, oh, like, things look fine now,
1:52
Speaker 2: by the time four o'clock rolls around, it wouldn't be
1:54
Speaker 2: surprising me. The S and P five hundred right now
1:56
Speaker 2: is up one point six percent. Would it really surprise
1:59
Speaker 2: you if it closed up two point six percent or
2:01
Speaker 2: down half a percent?
2:02
Speaker 4: No, not at all.
2:03
Speaker 2: No, like any of those are reasonable right now. And
2:06
Speaker 2: I have no idea what the next five hours entail,
2:09
Speaker 2: you know, and this is before we even get to
2:11
Speaker 2: like what the next five weeks might entail. So markets
2:14
Speaker 2: though in positive territory the Dow up five hundred and
2:17
Speaker 2: two points, s and P up eighty eight. Before you say, oh,
2:21
Speaker 2: it's just some small group of stocks leading the way, No,
2:23
Speaker 2: there are currently three hundred and eighty eight more stocks
2:25
Speaker 2: up in the S and P than down, so it
2:28
Speaker 2: is a broad based rally that is taking place. Basically,
2:30
Speaker 2: the only sector that seems to not really be participating
2:34
Speaker 2: in it in any way, shape or form is consumer staples,
2:37
Speaker 2: which is the only one in negative territory, and even
2:39
Speaker 2: there down point oh two percent right now, so just
2:42
Speaker 2: not much movement on that front. NASDAK is leading the way,
2:47
Speaker 2: so reversing its larger losses relative to other markets. NASDAK
2:51
Speaker 2: is up about two percent today. Ten year US Treasury
2:54
Speaker 2: not too much movement, up about two point six basis
2:56
Speaker 2: points to four point three oh two. The if you
3:00
Speaker 2: look at what this has been doing to mortgage rates,
3:03
Speaker 2: the national thirty or fixed rate average right now at
3:05
Speaker 2: six point seven eight, this will push it up to
3:07
Speaker 2: around six point eight, so still floating around the high sixes,
3:11
Speaker 2: but you know, down from a little bit north of
3:14
Speaker 2: seven over the start of the year, so interest rates
3:18
Speaker 2: getting better by about a quarter percent in the last
3:20
Speaker 2: month or two.
3:21
Speaker 3: You've got oil up forty.
3:23
Speaker 2: One cents a barrel to sixty six ninety six on
3:25
Speaker 2: West Texas intermediate triple a national average. For gas prices
3:29
Speaker 2: moving up a touch, up four tenths of a cent
3:31
Speaker 2: to three h eight and three tenths, So again, just
3:34
Speaker 2: not too much movement on oil prices and gas prices.
3:37
Speaker 2: Gas price has just been hanging out between three oh
3:39
Speaker 2: five and three point fifteen for the last two or
3:43
Speaker 2: three months now. We have just not had any movement
3:46
Speaker 2: in a meaningful direction there. And gold, after breaking through
3:49
Speaker 2: three thousand per ounce for the first time ever earlier today,
3:53
Speaker 2: actually get to threeenty seventeen at one point. It's up
3:56
Speaker 2: five to fifteen ounce at twenty nine ninety six right now.
4:00
Speaker 2: But those gold three thousand hats, if they if they
4:02
Speaker 2: have him somewhere, pull them out, because it got there today.
4:06
Speaker 2: Might not close there, but it got there. Let's talk
4:09
Speaker 2: a little bit about what we've seen in the last
4:11
Speaker 2: few weeks here, because the Magnificent seven has become the
4:16
Speaker 2: Magnificent seven in the past couple of weeks. Not my
4:20
Speaker 2: original work there, So Unfortunately I can take credit. I
4:25
Speaker 2: like Magnificent. The other one that I've seen out there
4:28
Speaker 2: is instead of MAG seven, the Bag seven because you're
4:31
Speaker 2: holding the bag.
4:32
Speaker 3: That's the one I've seen. Again, not my original work,
4:34
Speaker 3: but uh yeah.
4:35
Speaker 2: So the Nasdaq year to date, if you just look
4:38
Speaker 2: at where it is pulling it up, and even with
4:41
Speaker 2: this little bit, yeah, even with this little bit of
4:45
Speaker 2: an uptick today, it's still down eight point eight percent
4:47
Speaker 2: right now, whereas the S and P is down four
4:49
Speaker 2: point eight and the Dow is off three. So the
4:52
Speaker 2: Nasdaq has been you know, just punished more than any
4:55
Speaker 2: other index. And in particular it's those mag seven stocks, Apple, Microsoft,
5:01
Speaker 2: in Vidia, Apple, Amazon. You go when you take a
5:04
Speaker 2: look at how they've all performed year to date. Microsoft
5:08
Speaker 2: down eight point seven nine percent, in Vidia ten point
5:10
Speaker 2: sixty seven, Apple down fifteen, Amazon down ten, Tesla down forty. Obviously,
5:15
Speaker 2: that's been you know, kind of the leader in the
5:18
Speaker 2: clubhouse on the way down. Google or Meta or not
5:22
Speaker 2: Meta Google or Alphabet or whatever they call it these days,
5:25
Speaker 2: down about thirteen percent year to date. The only one
5:27
Speaker 2: that has been positive year to date is Meta, which
5:30
Speaker 2: is somehow up two point seven percent. I don't know
5:32
Speaker 2: how they've escaped what else has been going on in
5:35
Speaker 2: the MAC seven space, but they are the lone bright
5:39
Speaker 2: spot in that space with a two and a half
5:42
Speaker 2: percent gain so far this year. But just you know,
5:46
Speaker 2: significant volatility in these names. I mean I was looking
5:49
Speaker 2: at the chart of Invidia earlier today just because I
5:52
Speaker 2: was like, oh, like, how have you know things been going?
5:54
Speaker 3: And obviously I know the answer is not well in video.
5:59
Speaker 2: So just to give sense of how volatile it has
6:01
Speaker 2: been this year in Video opened the year at a
6:05
Speaker 2: price of one thirty five. Rallied more than ten percent
6:08
Speaker 2: in the first week, then fell more than ten percent.
6:11
Speaker 2: In the second week, rallied more than ten percent, again
6:13
Speaker 2: fell more than ten percent. Rallied more than ten percent,
6:16
Speaker 2: fell more than ten percent. It's already had four different
6:20
Speaker 2: rallies of ten percent or more in each direction. It's
6:24
Speaker 2: insane and and somehow there's a market then for the
6:27
Speaker 2: people who are like you know what, Paul, there's not
6:30
Speaker 2: enough volatility, and in video, I would like to find a
6:32
Speaker 2: two x or three x levered products for it, and
6:35
Speaker 2: someone's buying that stuff.
6:38
Speaker 4: Always demand. I mean, we talked about before the Magnificent
6:41
Speaker 4: seven in General were huge contributors to the success that
6:45
Speaker 4: the market saw in twenty twenty four and twenty twenty three.
6:48
Speaker 4: A lot of these companies, Chuck, We've spoke about this
6:50
Speaker 4: in the show before price to Perfection, and in Vidia
6:53
Speaker 4: is probably the best example of this, where they were
6:56
Speaker 4: growing revenue almost doubling it year over year in higher quarters,
7:01
Speaker 4: it has slowed down their revenue growth I slowed down
7:03
Speaker 4: kind of in quotes to about seventy eight percent or
7:06
Speaker 4: seventy plus percent, and the trading around it is kind
7:10
Speaker 4: of indicative of what the market was looking for, is
7:12
Speaker 4: perfection constant, you know, tremendous outperformance on results, and that
7:16
Speaker 4: has trickled across many of these other companies here that
7:19
Speaker 4: were just doing tremendously over the course of the last
7:22
Speaker 4: couple of years, but priced very highly in terms of
7:25
Speaker 4: a valuation metrics, and that's why we've seen some of
7:28
Speaker 4: the sell off here. It feels like over the course
7:30
Speaker 4: of the first couple months.
7:31
Speaker 3: Yeah, it's it's just been again.
7:33
Speaker 2: You can have companies like in Video that we can say, hey,
7:37
Speaker 2: this is a company that is a great company that
7:41
Speaker 2: is printing money hand over fist, but is what it's
7:43
Speaker 2: done from a stock perspective, sustainable. No, Like, obviously, it's
7:47
Speaker 2: not gonna be up like two hundred percent every year forever.
7:49
Speaker 2: It's gonna become bigger than You're not gonna have a
7:52
Speaker 2: world in which Nvidia becomes the US economy. No of this,
7:56
Speaker 2: and if you do, I'm not sure I want to
7:58
Speaker 2: live in it.
7:59
Speaker 4: Of those seven, and if you look at the list
8:01
Speaker 4: of the names, it's really only Apple or Tesla that
8:03
Speaker 4: you could argue that their business has slowed down a
8:06
Speaker 4: little bit to justify some of the selfs. It seems
8:09
Speaker 4: like the rest of them they're in the mix of
8:11
Speaker 4: the selloff, but not because of any fundamental business reason.
8:14
Speaker 4: We've covered the Tesla one on declining sales, and then
8:17
Speaker 4: on the Apple front there's been some weakness in China
8:19
Speaker 4: for the smartphone, the iPhone sixteen's and things like that,
8:22
Speaker 4: but the other five not really something that is markedly
8:27
Speaker 4: different about their business with this sell off.
8:29
Speaker 3: Now.
8:29
Speaker 2: The only thing on the other ones is you could
8:31
Speaker 2: kind of point to, hey, these are companies that have
8:33
Speaker 2: made their bones with you know, the AI trade and
8:36
Speaker 2: some questions about dice and you know the future of
8:38
Speaker 2: that industry. But as you mentioned, nothing is fundamentally changed
8:41
Speaker 2: about those businesses. To this point, it's more just hmmm,
8:46
Speaker 2: will something change? Yeap that that's been the only thing
8:49
Speaker 2: that you've seen on that front.
8:51
Speaker 3: Let's take a quick break here.
8:53
Speaker 2: When we come back, let's see we'll do a little
8:56
Speaker 2: bit of trivia that sounds fun, and then we'll talk
9:00
Speaker 2: social security. Black Rocks CEO Larry Fink talking about the
9:03
Speaker 2: program and whether or not.
9:04
Speaker 3: It should be privatized. We'll discuss after this.
9:08
Speaker 1: There's only one show that follows well Street's continued volatility.
9:13
Speaker 1: Keep it here all morning long on the Financial Exchange
9:16
Speaker 1: Radio Network. The Financial Exchange streams live on YouTube. Like
9:21
Speaker 1: our page and stay up to date on breaking business
9:23
Speaker 1: news All morning loan. This is the Financial Exchange Radio Network.
9:31
Speaker 5: This segment of the Financial Exchange is brought to you
9:34
Speaker 5: in part by the US Virgin Islands Department of Tourism.
9:36
Speaker 5: The US Virgin Islands are Saint Croix, Saint Thomas, and
9:39
Speaker 5: Saint John And if you act now, you can take
9:42
Speaker 5: advantage of a special promotion to Saint Croix experience a
9:45
Speaker 5: vibe like no other. Can get a two hundred and
9:47
Speaker 5: fifty dollars per person airline credit when you book a
9:50
Speaker 5: minimum five night's day at participating hotels. Go to visit
9:54
Speaker 5: USBI dot com and use code Vibe twenty twenty five
9:58
Speaker 5: to reserve your trip.
9:59
Speaker 4: Today, take your.
9:59
Speaker 5: Ne vacation to San Croix in America's Caribbean paradise the
10:03
Speaker 5: United States Virgin Islands. Go to visit USVII dot com
10:07
Speaker 5: and use code Vibe twenty twenty five to book your trip.
10:10
Speaker 5: That's visit USVII dot com and code Vibe twenty twenty five.
10:16
Speaker 5: Time for trivia here on the Financial Exchange. In today's
10:18
Speaker 5: Michael Kaine's ninety second birthday. The legendary actor retired back
10:23
Speaker 5: in twenty twenty three after seven decades gracing the silver screen.
10:29
Speaker 5: So trivia question today, how many Academy Awards did Michael
10:33
Speaker 5: Caine win? Once again? How many Academy Awards did Michael
10:37
Speaker 5: Caine win? Be the fourth person today to text us
10:42
Speaker 5: at six one seven three six two thirteen eighty five
10:45
Speaker 5: with the correct answer, and you win a brand new
10:47
Speaker 5: Financial Exchange Show T shirt.
10:49
Speaker 3: Once again.
10:50
Speaker 5: The fourth correct response to text us at six one
10:53
Speaker 5: seven three six two thirteen eighty five, we'll get that
10:56
Speaker 5: new T shirt. See complete contest rules at Financial shaneeshow
11:00
Speaker 5: dot com.
11:01
Speaker 2: All right, Paul, So we got a piece here in
11:03
Speaker 2: CMBC and it's talking about at the Blackrock Retirement Summit,
11:09
Speaker 2: which sounds just like a happening happen in place.
11:14
Speaker 3: CEO Larry Fink said, I'll read his quote.
11:18
Speaker 2: The problem is right now, we have a plan called
11:19
Speaker 2: social security that doesn't grow with the economy. And really
11:22
Speaker 2: what he's getting at is, hey, the demographics have left
11:25
Speaker 2: it such that you don't have enough people paying into
11:28
Speaker 2: the system in order to support the benefits that are
11:32
Speaker 2: promised in the system. And again it's saying, look like
11:36
Speaker 2: there's no individual Social Security account. The people paying in
11:39
Speaker 2: today help to fund the people that are taking money
11:43
Speaker 2: out today. And so the question is, you know, what
11:47
Speaker 2: do you do in order to fix this. We've talked about,
11:50
Speaker 2: you know, some of the different options out there. It
11:52
Speaker 2: appears that I think is talking about, Hey, do you
11:54
Speaker 2: want to privatize this? Obviously, it is a huge conflict
11:57
Speaker 2: of interest for Larry Fink to say this, because being
11:59
Speaker 2: the world's biggest investment manager, you better believe he's like, yes,
12:02
Speaker 2: I would love to have some of the trillions of
12:05
Speaker 2: dollars that go into this program to be able to invest.
12:09
Speaker 4: Yeah, interesting concept here, I mean, like you said, all
12:13
Speaker 4: sorts of conflict and interest on the investment side. Obviously,
12:17
Speaker 4: the argument that you could return more strongly, you could
12:22
Speaker 4: beat the treasury bills that are tied to social security.
12:25
Speaker 4: Of course, that that's an obvious one there, But that
12:28
Speaker 4: comes with a tremendous amount of investment risk for poor
12:33
Speaker 4: performance returns and for a system that's already unfunded. To
12:37
Speaker 4: take it private and then have someone else manage it
12:39
Speaker 4: and have it be subject to the whims of the market,
12:43
Speaker 4: that certainly is concerning, and also to me, it's just
12:48
Speaker 4: there's a lot of challenges and obstacles I feel like
12:51
Speaker 4: with that shift. You know, I don't know about the
12:55
Speaker 4: idea of an individual accounts perhaps like treating it more
12:59
Speaker 4: like a foreign Okay, it's not something I thought about extensively.
13:02
Speaker 4: What do you think, Chuck on this idea?
13:05
Speaker 2: So my view on social security is it's meant to
13:08
Speaker 2: be if you look at what it's like, how it's framed.
13:13
Speaker 2: The problem with retirement in the United States is, hey,
13:19
Speaker 2: if you get to retirement age and you have nothing
13:21
Speaker 2: saved for you, then you have a whole bunch of
13:24
Speaker 2: sixty five to eighty year olds that are running around
13:26
Speaker 2: that have no money, and like that it's a huge
13:29
Speaker 2: risk to the overall, like to society, like it's bad
13:35
Speaker 2: to have a bunch of destitute people of any age,
13:39
Speaker 2: but especially those who you know really are unable to
13:41
Speaker 2: work in a lot of cases because of their age.
13:43
Speaker 3: We all get to a.
13:44
Speaker 2: Point where our body and or our mind prevents us
13:48
Speaker 2: from being able to work. And so the fundamental principle
13:52
Speaker 2: of social security is, hey, here's the backstop, so that
13:56
Speaker 2: if you've worked over the course of your career, you
13:59
Speaker 2: have something to live on in retirement. And it strikes
14:04
Speaker 2: me obviously, look, there are different risks that are out
14:07
Speaker 2: there regardless of what the investment is. We talk about
14:09
Speaker 2: this a lot in the financial industry, where every investment
14:13
Speaker 2: has risk. Like even if you say, well, I've got
14:15
Speaker 2: my money in a bank account, Well, didn't twenty twenty
14:17
Speaker 2: two teach you that there's inflation risk. You know, Oh,
14:21
Speaker 2: well that's okay, I'll put my money in bonds because
14:24
Speaker 2: you know they earn more than just sitting in a
14:26
Speaker 2: checking account. Well didn't twenty twenty two teach you about
14:28
Speaker 2: interest rate risk? Of course, every investment has some kind
14:32
Speaker 2: of risk that's attached to it. And so the question
14:34
Speaker 2: with Social Security is, hey, if I'm trying to build
14:37
Speaker 2: the backstop that people can depend on for you know,
14:41
Speaker 2: that emergency, not even emergency, but just something to provide
14:46
Speaker 2: income on a regular basis in retirement, what do I
14:51
Speaker 2: buy in that program in order for people to you know,
14:57
Speaker 2: be able to be comfortable there. And based on again
15:00
Speaker 2: kind of how it works, you're generally talking about buying
15:05
Speaker 2: bonds because like again, if you have fixed liabilities in
15:08
Speaker 2: the future and you're you know, saying, Okay, how is
15:10
Speaker 2: this going to be invested for you know, liabilities that
15:13
Speaker 2: occur at a time in the future, it's yeah, you
15:15
Speaker 2: can use bonds and if as long as you hold
15:17
Speaker 2: the maturity, the interest rate risk of what they're worth
15:19
Speaker 2: in the.
15:20
Speaker 3: Interim is not a problem.
15:23
Speaker 2: So like the framework there makes sense, and yeah, look
15:28
Speaker 2: there's a it's not even a question. It's a certainty
15:32
Speaker 2: that Social Security is not maximizing the return that's put
15:35
Speaker 2: into it. Yes, like that, that's not it's not even
15:39
Speaker 2: a question like, yes, the program could absolutely earn more
15:44
Speaker 2: if it were invested differently, The question is do you
15:49
Speaker 2: want to then take the risk that hey, if something
15:52
Speaker 2: unexpected occurs that you either a can't make your payments
15:58
Speaker 2: that you've promised then or like that aren't really promised,
16:01
Speaker 2: or hey, those payments are reduced, or because people would
16:04
Speaker 2: lose trust in the system, do you borrow a whole
16:06
Speaker 2: bunch of money then in order to you know, fun
16:08
Speaker 2: benefits that you know are out there. So I look,
16:14
Speaker 2: I'm pretty conservative on what I want to do with
16:16
Speaker 2: Social Security and that I don't love the idea of
16:21
Speaker 2: upping the risk to try to get better returns in
16:24
Speaker 2: a program that's designed to backstop American's financial retirement. If
16:27
Speaker 2: you want to take risk, there's plenty of ways to
16:30
Speaker 2: whether you're talking four one K, whether you're talking for
16:34
Speaker 2: three b IRA set byra like, depending on each individual situation.
16:38
Speaker 2: There's plenty of ways to save money above and beyond
16:41
Speaker 2: Social Security. But Social Security to me is about backstopping
16:46
Speaker 2: the American retiree such that they're not destitute in retirement,
16:51
Speaker 2: and that means taking a more conservative investment approach than
16:55
Speaker 2: you otherwise would, because that's what the program's designed to do. Now,
17:01
Speaker 2: like Fink does say, and like, I don't even know
17:03
Speaker 2: if this is fake. Someone in here is like, hey,
17:05
Speaker 2: there's kind of like a failure of imagination with social Security.
17:08
Speaker 2: If you want to be like, hey, you can pay
17:12
Speaker 2: if you want, like an optional like additional half percent
17:15
Speaker 2: tax that goes into something more aggressive, you know, for
17:18
Speaker 2: a personal Social Security account. Oh okay, Like sure, like
17:23
Speaker 2: if we want to really get creative with it or something, yeah,
17:27
Speaker 2: Like there's ways that you can, you know, do that.
17:30
Speaker 2: But I'm just not sure that changing like the base
17:34
Speaker 2: program makes sense because it takes away the actual safety
17:38
Speaker 2: net piece of what is you know, I think the
17:41
Speaker 2: core function of the program. In my opinion, your mileage
17:44
Speaker 2: may vary like that. There's people who have all different
17:45
Speaker 2: opinions on this. I don't think any of them are
17:48
Speaker 2: inherently wrong, because the one thing that we do know
17:50
Speaker 2: is that the program asn't exists today is not sustainable.
17:53
Speaker 2: So there have to be changes that are made, and
17:56
Speaker 2: we can all have different opinions on the right way
17:58
Speaker 2: to do this. But I don't love the idea of
18:00
Speaker 2: just being like, well, it's up the amount of risk
18:02
Speaker 2: that you can take because returns are you likely to
18:05
Speaker 2: be better?
18:06
Speaker 3: Well, what if they're not, Like, then then what do
18:08
Speaker 3: you do?
18:08
Speaker 4: So many more potential conflicts that can come from that
18:11
Speaker 4: on a bunch of different levels.
18:12
Speaker 2: You're right, yeah, yeah, So that's that's kind of where
18:15
Speaker 2: I end up landing on it again, that there's no
18:17
Speaker 2: good or perfect answer on this. So if you're listening
18:19
Speaker 2: and you're like, oh, chuck, that's nice, but that's dumb,
18:21
Speaker 2: Like okay, Like I get it, Like you don't have
18:23
Speaker 2: to agree with me, but I think there are different
18:26
Speaker 2: approaches that are gonna need to be talked about, and
18:28
Speaker 2: ultimately we're gonna have to make some decisions on this
18:32
Speaker 2: like that. Here's the thing. Even doing nothing is still
18:36
Speaker 2: making a decision. It's just doing nothing is kind of
18:39
Speaker 2: a bad decision. But we're we we gotta do something
18:41
Speaker 2: on this puppy because there is a ticking cock that's
18:44
Speaker 2: now down to you know, seven to nine years depending
18:47
Speaker 2: on the projections that you look at, and seven to
18:50
Speaker 2: nine years goes pretty quickly. I mean seven years ago
18:53
Speaker 2: was twenty eighteen. Yep, doesn't that feel like yesterday?
18:56
Speaker 4: Then the longer you wait, the worse the changes are
18:59
Speaker 4: gonna be. A there're more packful negatively that they're gonna be.
19:02
Speaker 2: Yeah, exactly. So I don't know we got to talk
19:05
Speaker 2: about it. We got to get different ideas out there.
19:07
Speaker 2: This one not my favorite, but hey, like you, you're
19:10
Speaker 2: gonna have to figure out how to deal with the
19:12
Speaker 2: thing and get all the ideas on the table.
19:14
Speaker 3: And let's let's figure this puppy out. Uh.
19:16
Speaker 2: Taking a look at markets as we head towards the
19:18
Speaker 2: bottom of the hour, the Dow is up five hundred
19:21
Speaker 2: and forty one points, the S and P's up ninety three,
19:23
Speaker 2: NASDAG is up three hundred and sixty two, So continued
19:26
Speaker 2: green on the board, Which kind of feels good heading.
19:29
Speaker 3: Into the weekend, doesn't it. Yeah?
19:31
Speaker 2: I think so let's take a quick break when we
19:33
Speaker 2: come back. We got the trivia answer right after this.
19:42
Speaker 1: Bringing the latest financial news straight to your radio every day.
19:47
Speaker 1: It's the Financial Exchange on the Financial Exchange Radio Network.
19:53
Speaker 1: Text us six one, seven, three, six two thirteen eighty
19:56
Speaker 1: five with your comments and questions about today's show and
20:00
Speaker 1: let us know what you think about the stories we
20:02
Speaker 1: are covering. This is the Financial Exchange Radio Network, All right.
20:08
Speaker 5: Trivia question today was how many Academy Awards did Michael
20:12
Speaker 5: Caine win?
20:13
Speaker 3: That will be two.
20:15
Speaker 5: He won his first Academy Award in nineteen eighty seven
20:18
Speaker 5: for his role in Hannah and her Sisters. He won
20:21
Speaker 5: his second Academy Award in two thousand for his role
20:25
Speaker 5: in The Cider House Rules. Tom from West Springfield, Mass
20:30
Speaker 5: is our winner today, taking home a new Financial Exchange
20:33
Speaker 5: Show t shirt. Congrats to Tom there, and we play
20:36
Speaker 5: trivia every day here on the Financial Exchange ce. Complete
20:40
Speaker 5: contest rules at Financial Exchange Show dot com.
20:44
Speaker 3: Paul, what do you got? What do you want to
20:45
Speaker 3: get to here?
20:46
Speaker 4: I want to talk a little bit about gearshifters, Chuck.
20:50
Speaker 4: Carmakers are doing all sorts of fancy updates to gear
20:54
Speaker 4: shifters around the autumn manufacturing space, and.
20:57
Speaker 3: What kinds of things are they doing.
20:59
Speaker 4: The one reason I bring this up is my mother
21:02
Speaker 4: in law has a real She has a much nicer
21:04
Speaker 4: car than I do, a BMW SUV of some sort,
21:08
Speaker 4: and over the summer I had to move her car
21:10
Speaker 4: and I got into it and the gearshifter. All of
21:13
Speaker 4: us are very accustomed to just pulling it down from
21:16
Speaker 4: park to drive or reverse to get it to go
21:19
Speaker 4: in the direction that you want to go, But this
21:21
Speaker 4: particular one, the parking setting had a button attached to it.
21:26
Speaker 4: And then it was also counterintuitive where you didn't have
21:28
Speaker 4: you couldn't go straight down to get it into.
21:30
Speaker 5: Reverse, where you had to go off to the center.
21:33
Speaker 4: In the center. It was held in the center, but
21:35
Speaker 4: you couldn't, like your typical center one usually just go
21:38
Speaker 4: straight down. You had to sort of jiggle it down
21:40
Speaker 4: a little bit, not a complete straight shot. And I
21:43
Speaker 4: was flummoxed also by the parking button that they had
21:46
Speaker 4: in the middle there too, And it just seems like
21:49
Speaker 4: this is getting more and more complex across a bunch
21:52
Speaker 4: of different cars out there. In particular, the Genesis, which
21:56
Speaker 4: is the Hyundai motor sort of luxury brand e E suv,
22:02
Speaker 4: has a knob now that they've put in the middle
22:05
Speaker 4: of an ORB. They call it where they call it
22:07
Speaker 4: the crystal sphere, the crystal sphere. There's a four minute
22:10
Speaker 4: video out there explaining how the ORB works, where you
22:14
Speaker 4: have to rotate it one hundred and eighty degrees in
22:17
Speaker 4: order to get it to these certain different settings that
22:20
Speaker 4: we're all accustomed to. There's others out there that Tesla
22:24
Speaker 4: has a touchscreen functionality where you can press tiny buttons
22:28
Speaker 4: to switch the gears, and I know that it's always
22:31
Speaker 4: our natural reflex to push back against change. And I'm
22:34
Speaker 4: sure once you get accustomed to these changes, it's smooth sailings.
22:39
Speaker 4: But it makes it a lot harder to switch between
22:42
Speaker 4: cars when they're changing up what has been such a
22:45
Speaker 4: simple way to start up cars for Who's.
22:48
Speaker 2: The person who's out there who's like, hey, i'd really
22:51
Speaker 2: like to see you change how we you know, shift
22:55
Speaker 2: automatic vehicles?
22:58
Speaker 4: They are arguments here, even Genesis in particular. It's to
23:01
Speaker 4: enhance safety and to create an emotional connection with the driver.
23:04
Speaker 4: What does that even mean? The ORB? You have an
23:08
Speaker 4: emotional connection to it. I love my ORB. It's the
23:10
Speaker 4: best way to shift gears around.
23:13
Speaker 3: I have an emotional connection to the ORB.
23:16
Speaker 4: Positive or negative one?
23:19
Speaker 2: Well, pretty negative, pretty negative me too. It's it's just
23:23
Speaker 2: something where I look at this and I'm like, guys,
23:26
Speaker 2: the problems that I want you to how much money
23:29
Speaker 2: did you pour into the development of this? And I'm
23:32
Speaker 2: not saying that like that dollar that went there would
23:34
Speaker 2: have made some huge difference, But when I think about
23:37
Speaker 2: what I want from a vehicle, it's like, hey, figure
23:41
Speaker 2: out ways to get me better gas mileage, figure out
23:44
Speaker 2: ways that I can fit more stuff in there, make
23:46
Speaker 2: the interior more comfortable.
23:48
Speaker 3: Not here's a different way.
23:51
Speaker 2: I mean, here's the other thing about this, like the
23:53
Speaker 2: reason why it's completely ludicrous, Like it's just a complete
23:56
Speaker 2: waste of time, Paul. In a typical drive, there are
24:01
Speaker 2: three times that you shift. There's one to back up
24:05
Speaker 2: when you're pulling out of the spot that you're in.
24:07
Speaker 2: There's two when you shift into drive in order to
24:10
Speaker 2: go where you're going, and there's three when you shift
24:13
Speaker 2: it to park when you arrive at your destination. It
24:17
Speaker 2: literally regardless of how long you're driving. Now granted, look
24:20
Speaker 2: I get it. You could make like a three point
24:21
Speaker 2: turn and now you've got you know, six different you
24:24
Speaker 2: know shifts that you need to make. But still the
24:26
Speaker 2: point remains there are this is something that affects ten
24:31
Speaker 2: seconds of your drive, no matter how far you are going.
24:35
Speaker 2: Why is any company investing in this?
24:37
Speaker 4: I'm with you, It's frustrating. It's very frustrating.
24:41
Speaker 2: You know, invest in a better transmission? Actually, sure, like
24:44
Speaker 2: why not? Like I'd love to see like transmission improvements.
24:47
Speaker 2: That sounds lovely, But I touched this twice in the ride.
24:51
Speaker 2: You know that this is like, well, we're gonna get
24:54
Speaker 2: rid of your window buttons, and instead all you have
24:58
Speaker 2: to do is drag your fingers down the.
25:00
Speaker 3: Windows to open them.
25:02
Speaker 5: No, I don't want that, Like, just wave your hand
25:05
Speaker 5: down and it'll do it.
25:06
Speaker 3: Nothing will go you know.
25:07
Speaker 2: You have you have to say you know, the word
25:11
Speaker 2: down in three different languages and the windows will go down.
25:15
Speaker 3: Well, no, I don't want to do that. Just let
25:17
Speaker 3: me push the button.
25:18
Speaker 5: What if I just want to open a tiny crack,
25:20
Speaker 5: Just you.
25:20
Speaker 3: Say down in two different languages and it goes down
25:23
Speaker 3: a little bit.
25:25
Speaker 4: If it ain't broke, don't fix it.
25:27
Speaker 2: So I don't know, Like I'm just I'm kinda like
25:32
Speaker 2: I don't know about this.
25:33
Speaker 3: This seems like a solution in search of.
25:34
Speaker 2: A problem to me. And I'm not buying it. Uh
25:38
Speaker 2: what I am buying not actually buying, but what I
25:41
Speaker 2: what I do? Like, Paul, did.
25:42
Speaker 3: Did you read this piece on these three D printed homes?
25:45
Speaker 4: I perused it. Yes, So these actually look kind of cool.
25:50
Speaker 2: So it's in a town called Georgetown, Texas, which is
25:52
Speaker 2: a little bit outside of Austin, and Lenar, who's the
25:56
Speaker 2: second second biggest home builder in the country, Uh, decided, Hey,
26:00
Speaker 2: we're gonna do like a test run of one hundred
26:04
Speaker 2: three D printed homes. They worked with a company called Icon,
26:08
Speaker 2: who's a big three D printing company. And the big
26:12
Speaker 2: thing about these three D printers is remember three D
26:14
Speaker 2: printing is basically layering material over and over, so there's
26:17
Speaker 2: no sharp corners, They're all rounded edges. But I gotta
26:20
Speaker 2: say these things look pretty cool actually, And the big
26:23
Speaker 2: selling point on this is even in the Austin market,
26:26
Speaker 2: which is now pretty highly priced, given how many people
26:30
Speaker 2: moved down there, they were able to get two bedroom
26:33
Speaker 2: units down there under four hundred thousand dollars. And they
26:37
Speaker 2: say that because of what they learned here, they're going
26:39
Speaker 2: to do another development of two hundred homes that because
26:42
Speaker 2: of the scale and how they were able to adapt
26:44
Speaker 2: these processes, they think they're going to be able to
26:46
Speaker 2: build these even more cheaply for larger three and four
26:49
Speaker 2: bedroom homes in the future.
26:51
Speaker 4: The other piece that they mentioned here is that utility
26:54
Speaker 4: bills for those people who were in this three D
26:56
Speaker 4: printed home from a year ago, their electric bill was
26:59
Speaker 4: twenty six bucks last month. The concrete really retains temperature
27:03
Speaker 4: and heat and better than her standard colonial that she
27:06
Speaker 4: had previously, and it feels like she's saying, this is
27:09
Speaker 4: Holly Fekens here, someone who's lived in the home for
27:11
Speaker 4: about a year. It's safer than any other house that
27:14
Speaker 4: she's built in. There has been some feedback here saying
27:16
Speaker 4: that it's better wind resistance for hurricanes and fire resistance
27:20
Speaker 4: as well. So if you can have something that is better,
27:24
Speaker 4: particularly for some of the areas in the country that
27:26
Speaker 4: we talk about that have been really impacted by natural disasters,
27:28
Speaker 4: and affordable too. I mean that's the real home run piece.
27:32
Speaker 4: Chuck is trying to get some more affordable housing options
27:35
Speaker 4: out there. That four hundred thousand dollars price point is fantastic.
27:40
Speaker 4: The home market is really looking for innovation, so if
27:43
Speaker 4: this could be more wid spread. I know we're only
27:45
Speaker 4: talking about a couple hundred homes here, but it's exciting
27:48
Speaker 4: developments from an area that needs innovation.
27:51
Speaker 3: Yeah, I think it's cool stuff.
27:52
Speaker 2: And again, who knows, you know, this is the first,
27:56
Speaker 2: you know, test of these. I'm sure that as they
27:58
Speaker 2: get more experienced and prove they have more freedom to
28:01
Speaker 2: do things a little bit differently in this and that,
28:03
Speaker 2: And I don't know, I just think it's kind of
28:05
Speaker 2: cool to see someone trying to do something different in
28:08
Speaker 2: the housing market, where high costs and slow production times
28:11
Speaker 2: are you know, a big thing. Hey, is this a
28:13
Speaker 2: way that you can potentially reduce costs meaningfully and end up,
28:18
Speaker 2: you know, building more rapidly when it's all said and done.
28:21
Speaker 3: I think that's kind of.
28:21
Speaker 4: Cool, very neat, very neat. Indeed, here what else you
28:25
Speaker 4: got for me? Intel has hired a new CEO. They're
28:30
Speaker 4: going to be tapping Lip Boutan, which is a former
28:35
Speaker 4: executive from Cadence Systems. And what the issues that Intel
28:40
Speaker 4: has run into over the course of the last geez
28:43
Speaker 4: probably decade or so, is they've just failed to make
28:46
Speaker 4: moves on a lot of the major innovations in the
28:49
Speaker 4: technology space. They recently were trying to focus and pivot
28:53
Speaker 4: to becoming more of a foundry company. So basically the
28:56
Speaker 4: company that would manufacture chips that's dominated largely by Taiwan
29:00
Speaker 4: Semiconductor out of out of Taiwan, and Samsung does a
29:04
Speaker 4: bit of it as well. Now tapping on this new CEO,
29:07
Speaker 4: they've had, I believe chuck four or five CEOs over
29:11
Speaker 4: the course of the last five or six years. Here,
29:14
Speaker 4: it's a company that's just been a tremendous amount of
29:16
Speaker 4: turmoil and really needs a clear vision on what they're
29:20
Speaker 4: gonna be doing going forward, just because they've been rumored
29:24
Speaker 4: about this idea of perhaps a breakup of Intel to
29:28
Speaker 4: sort of split up the divisions here. But this is
29:31
Speaker 4: really make or break time for Intel. Their stock has
29:33
Speaker 4: been punished over the course of the last couple of years,
29:36
Speaker 4: and they've had Pat Gelsinger, They've had numerous other CEOs
29:40
Speaker 4: try and come in and turn things around. It it
29:42
Speaker 4: just hasn't happened.
29:44
Speaker 2: Yeah, it's just been a tough run for them. Let's
29:46
Speaker 2: take a quick break here. When we come back, we're
29:50
Speaker 2: gonna be joined by the one and only Paul Lamonica
29:53
Speaker 2: from Barons.
29:54
Speaker 1: Right after this fine daily interviews and full shows of
29:58
Speaker 1: the Financial Exchange and how.
29:59
Speaker 3: Are you too?
30:00
Speaker 1: Page like us on YouTube and get caught up on
30:03
Speaker 1: anything and everything you might have missed. This is the
30:06
Speaker 1: Financial Exchange Radio Network. The Financial Exchange Show podcast drops
30:11
Speaker 1: every day on Apple, Spotify, and iHeartRadio. Hit that subscribe
30:15
Speaker 1: button then leave us a five star review. You're listening
30:18
Speaker 1: to the Financial Exchange Radio Network. Ladies and gentlemen. The Weekend.
30:30
Speaker 2: Yes promised from now joined by the one and only
30:32
Speaker 2: Paul Monica from Barons.
30:35
Speaker 3: Paul, how are you today, good?
30:37
Speaker 6: Thanks, how you guys doing.
30:39
Speaker 3: We're doing great.
30:39
Speaker 2: We're gonna talk to you a little bit about Trump
30:42
Speaker 2: Media and Technology Group, and Yeah, what's interesting here is
30:45
Speaker 2: that this was one that in the run up to
30:48
Speaker 2: the election, I think it was, you know, kind of
30:51
Speaker 2: being used almost as a proxy for Donald Trump's chances
30:54
Speaker 2: of becoming president, and clearly saw a significant run up
30:58
Speaker 2: shortly after the election. But since then it's basically been
31:03
Speaker 2: on a slide, absent you know, a small bounce that
31:06
Speaker 2: it saw in December. What's what are we seeing here
31:10
Speaker 2: from the company right now in terms of just how
31:12
Speaker 2: the shares have been moving.
31:14
Speaker 6: Yeah, it's really interesting. I mean, the stock, as you mentioned,
31:17
Speaker 6: got a big run up in the anticipation of the election,
31:22
Speaker 6: and I think part of it was that, you know,
31:24
Speaker 6: you had seen reports that there were retail investors who
31:29
Speaker 6: supported the president that were buying DJT shares as a
31:34
Speaker 6: means of showing some support financially as well. And you know,
31:40
Speaker 6: the stock really had a very sharp run up into
31:44
Speaker 6: the election. But since then, along with the rest of
31:48
Speaker 6: the market, it's been you know, mostly downhill. And I
31:52
Speaker 6: think that you know, retail investors are maybe not as
31:57
Speaker 6: enamored with DJT as a Trump trade. Uh, you know,
32:02
Speaker 6: he's already won the election. Uh and uh. For institutional investors,
32:07
Speaker 6: there's not a lot to like about the stock other
32:10
Speaker 6: than the fact that it's in some prominent indexes, the
32:13
Speaker 6: Russell one thousand, Russell three thousand, So you have some
32:16
Speaker 6: index ETFs that have bought the shares, But it's you know, difficult,
32:21
Speaker 6: I think for an actively run manager to buy a
32:25
Speaker 6: stock that you know, the company continues to lose money,
32:29
Speaker 6: revenue is very small. Yes, they are making some expansion
32:33
Speaker 6: moves into fintech and hope to launch some ETFs of
32:37
Speaker 6: their own. Obviously big on crypto, you know, just as
32:41
Speaker 6: the president has a suddenly become So I think there
32:45
Speaker 6: are things there that, you know, potentially make Trump Media
32:49
Speaker 6: Technology a viable company down the road. But we're definitely
32:54
Speaker 6: not there yet.
32:56
Speaker 2: In terms of it, like analyst coverage and things like that.
32:59
Speaker 6: Are no one covers it?
33:02
Speaker 3: What are the experts? No one covers it.
33:04
Speaker 6: It's been a year since the SPAC deal closed and
33:08
Speaker 6: you still don't have any analysts covering it. It's hard
33:12
Speaker 6: to speculate why that's the case. I mean maybe because
33:15
Speaker 6: this wasn't a traditional IPO, so you didn't have the
33:19
Speaker 6: usual kind of laundry list of major banks that have
33:23
Speaker 6: relationships built in ahead of the stock making its you know, debut,
33:29
Speaker 6: you know. But also, I mean it's certainly possible that politically,
33:34
Speaker 6: you may have companies that are wary of either being
33:38
Speaker 6: accused of currying favor by having you know, positive coverage
33:44
Speaker 6: on a company like DJT or the flip side. They
33:48
Speaker 6: don't want to get penalized if someone havn't forbid puts
33:51
Speaker 6: out like a celerating on the stock.
33:54
Speaker 2: You mentioned that they have a couple of things that
33:58
Speaker 2: are brewing in the fintech space. Is there any timeline
34:02
Speaker 2: for the release of those products or is that still
34:05
Speaker 2: up in the air.
34:06
Speaker 6: Yeah, it's still up in the air. I mean, they
34:08
Speaker 6: have the truth dot five financial services brand. They are
34:14
Speaker 6: planning to launch some ETFs and separately managed accounts tied
34:19
Speaker 6: to themes that kind of align with Trump politically. So
34:24
Speaker 6: there's a made in America potential fund, a US energy
34:28
Speaker 6: independence one, and one tied to bitcoin and crypto. So,
34:32
Speaker 6: you know, I think that you know, the company is
34:35
Speaker 6: wisely you know, looking to expand in areas where the
34:42
Speaker 6: you know, Trump supporters clearly probably believe in those themes
34:47
Speaker 6: from an investing standpoint as well. But again, this is
34:51
Speaker 6: the company that revenue in twenty twenty four was just
34:57
Speaker 6: a little bit more than emillion, and that's not a misprint.
35:03
Speaker 6: That's not billion, it's million. And uh, you know they
35:07
Speaker 6: lost about four hundred million dollars last year, you know
35:12
Speaker 6: as well. So this is a company that's trying to grow,
35:16
Speaker 6: but it's incredibly small. This is not, by any means
35:21
Speaker 6: a social media giant like Meta or you know, Musk's
35:25
Speaker 6: X and you know, I think Elon Musk that is
35:27
Speaker 6: a potential concern as well for the stock, namely that
35:32
Speaker 6: you know, you had truth Social, which is owned by
35:35
Speaker 6: you know, the Trump Media Technology Group. There was a
35:38
Speaker 6: point in time where you felt that truth Social was
35:41
Speaker 6: the place you had to be to hear from Trump.
35:45
Speaker 6: But now that he's no longer a candidate, he's the president,
35:48
Speaker 6: you know, where we're not lacking for commentary from him.
35:52
Speaker 6: And because of the quote unquote bromance now with Elon Musk,
35:57
Speaker 6: he's back on X as well, So you don't have
36:00
Speaker 6: that scarcity value hid the truth social and Trump media
36:04
Speaker 6: the way you used to because of you know, Trump
36:08
Speaker 6: not being on when it was known as Twitter anymore,
36:11
Speaker 6: leading up a couple of years, you know, after the
36:14
Speaker 6: last election.
36:15
Speaker 2: Very good, Paul, appreciate you joining us today today. Thank
36:18
Speaker 2: you so much for the time, and I hope you
36:21
Speaker 2: have a great weekend.
36:22
Speaker 6: Thanks Sam, you Chuck. I appreciate it.
36:25
Speaker 2: That is Paul Lamonica talking about Trump media and technology
36:29
Speaker 2: and the tick around. That is d J T Paul.
36:33
Speaker 2: Anything else, this is other Paul Paul Lane. We're inundated
36:37
Speaker 2: with Paul's right now.
36:40
Speaker 3: Anything else catching your eye today?
36:41
Speaker 4: I was just gonna throw a quick stack stack roulette
36:44
Speaker 4: story at you. Yes, Hasbro wants to get more adults
36:48
Speaker 4: to play with toys. And my question to you, because
36:50
Speaker 4: we both have young kids, are there any toys of
36:52
Speaker 4: your kids that you find yourself sort of having a
36:55
Speaker 4: little bit of an attachment to that it takes it
36:57
Speaker 4: back to your younger days. Because I have one Legos.
36:59
Speaker 3: I could build Legos all day with that.
37:01
Speaker 5: Yeah, the Legos is big right now.
37:03
Speaker 4: Magnetiles is That's That's what I find myself really locked
37:07
Speaker 4: in on.
37:07
Speaker 5: I got one a lot, I got one. You guys
37:10
Speaker 5: do Marble Run. No, look, look that up. You'll recognize.
37:14
Speaker 5: Is that what the pipes and like you raise the
37:15
Speaker 5: marble lins, like you connect them. You can make your
37:17
Speaker 5: own different marble track and everything. Oh yeah, I could
37:20
Speaker 5: do that by myself.
37:21
Speaker 3: No, no problem.
37:21
Speaker 4: All the magnetiles. I find myself a little too locked
37:24
Speaker 4: in sometimes on building them. I have to realize who
37:27
Speaker 4: who's really in charge there. But ultimately their focus is
37:30
Speaker 4: not any of those items, but Hasbro wants to build
37:32
Speaker 4: out more spending for Star Wars action figures. Legos was
37:36
Speaker 4: one of them, But sixty percent of Hasbro's revenue come
37:39
Speaker 4: from people who are thirteen and over, So the more
37:41
Speaker 4: you know.
37:42
Speaker 2: Yeah, I'm looking at Marble Run right now, Tuck, I
37:44
Speaker 2: see what you get.
37:45
Speaker 4: Yeah, that's right up your alley, Chuck.
37:46
Speaker 5: I'm just gonna say that.
37:47
Speaker 2: I feel like this means I should get into like
37:51
Speaker 2: like sewage management or something like.
37:54
Speaker 3: That's the only way you can make or you know.
37:57
Speaker 5: You can make your own soup tubes with that.
37:59
Speaker 2: Oh yeah, this yet I am. The soup tubes are back, baby,
38:03
Speaker 2: and they're back big.
38:05
Speaker 5: Say you test them out now, you know, taking a look.
38:07
Speaker 2: At markets DAWs up six hundred and five now, So
38:10
Speaker 2: how's that for a reversal. The S and P's up
38:11
Speaker 2: one oh two and the NASDAG up three ninety eight.
38:15
Speaker 2: Thus far, a lot of green on the board as
38:17
Speaker 2: we close out the week. Have a fantastic weekend. We're
38:20
Speaker 2: back at it Monday. We got retail sales data and
38:22
Speaker 2: a FED meeting next week, and a.
38:24
Speaker 3: Bunch of housing stuff too.
38:26
Speaker 2: We'll have all of it here on the Financial Exchange.