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SpaceX IPO Hype Faces a Reality Check · The Financial Exchange Show

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Speaker 1: Chuck Zada and Mike Armstrong.
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Speaker 2: It's Chuck and Mike and Tucker with you, and I
1:14
Speaker 2: hope you all had a great weekend. I mean it
1:18
Speaker 2: was it was lovely, in my opinion, wonderful weather. Summer's
1:23
Speaker 2: here we complain about. It was great and we kick
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Speaker 2: things off this week, and things are great in the
1:31
Speaker 2: United States stock market as well, with markets trying to
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Speaker 2: rally back some of their losses from Friday, about half uh,
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Speaker 2: maybe between forty and fifty percent, depending on the index
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Speaker 2: that you're looking at. The Dow Jones Industrial Average up
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Speaker 2: two hundred and thirty four points about half percent, the
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Speaker 2: S and P five hundred up eighty three points about
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Speaker 2: one point one percent, and the NASDAK composite up four
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Speaker 2: hundred and sixty three points about one point eight percent. Now,
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Speaker 2: obviously that's not making up the law that we saw
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Speaker 2: on Friday, but I don't know. I'd rather see some
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Speaker 2: green on the board today than not. And so Yahoo,
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Speaker 2: that's uh, that's well, they don't trade publicly.
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Speaker 3: Friday tessimism turning into Monday's optimism.
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Speaker 2: There you have it, at least some of some optimism.
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Speaker 2: It's uh. Again, the SP five hundred lost two hundred
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Speaker 2: points on Friday, making up eighty is it's a good start,
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Speaker 2: you know, it's forty percent of the way there. But
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Speaker 2: uh again, after a big day like that, the trend
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Speaker 2: has been dip buying. We'll see if this has any legs.
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Speaker 2: Ten year Treasury up one point two basis points to
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Speaker 2: four point five four eight percent, still moving up, continuing
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Speaker 2: Friday's move in that direction. Dollar index is off point
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Speaker 2: one three percent to ninety nine point nine to two,
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Speaker 2: and we've got gold off thirteen eighty announced to forty
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Speaker 2: three fifty one and fifty cents. Crude Oil West Texas
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Speaker 2: Intermediate is let's see where is that puppy there? It is.
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Speaker 2: It's up a dollar thirty a barrel to ninety one
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Speaker 2: eighty four, triple a national averageur gas prices those sliding
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Speaker 2: again over night, now down to four sixteen and four tenths.
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Speaker 2: We're getting into the range where I would expect us
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Speaker 2: to bottom if CREWE doesn't fall any further. Somewhere in
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Speaker 2: that four ten to four fifteen range is kind of
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Speaker 2: where I expect to land here, and then we'll just
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Speaker 2: have to see where crude prices go from there. At
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Speaker 2: this point, so that is the state of play as
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Speaker 2: we kick things off to start the week, a little
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Speaker 2: bit of a rally going on to make things up
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Speaker 2: in equities, bonds continuing to sell off a touch, and
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Speaker 2: crude moving back up a little bit as well. Piece
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Speaker 2: in the Wall Street Journal, can SpaceX live up to
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Speaker 2: Wall Street's multi trillion dollar hype? So we have to
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Speaker 2: define two terms in this piece. Number one, what is
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Speaker 2: the hype that we're seeing? Like, what do we mean
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Speaker 2: by the what is the hype that we're seeing?
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Speaker 3: I think we're seeing hype. Yeah, actually, I'll confirm. I
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Speaker 3: think we're seeing hype both from Wall Street institutions as
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Speaker 3: well as individuals. I'm not saying that everybody is positive
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Speaker 3: on this, but from the institutions, you are having major
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Speaker 3: historic institutions literally change their rules for how they include
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Speaker 3: stocks in their indices for this hypo. Specifically, now as
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Speaker 3: THATAK changed the rules, S and P voted on it
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Speaker 3: and failed to change the rules, but they literally changed
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Speaker 3: the rules over one new company hitting public market. So
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Speaker 3: I think that can be constituted as hype. And then separately,
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Speaker 3: but what's the hype?
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Speaker 2: What is the hype?
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Speaker 1: Like?
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Speaker 2: What are that's an action?
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Speaker 3: Like?
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Speaker 2: What's the hype saying, like, what what are we trying
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Speaker 2: to live up to? Like I'll give you an example,
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Speaker 2: when Lebron James was eighteen years old and going into
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Speaker 2: the NBA draft, the hype was, this is the next
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Speaker 2: Michael Jordan and then we could watch his career over
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Speaker 2: the next twenty five years and prove out did he
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Speaker 2: get there or not? So what is SpaceX being hyped
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Speaker 2: up to be?
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Speaker 3: I guess, is my question, the biggest and most important
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Speaker 3: defense contractor in the world, which is not that exciting.
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Speaker 3: I think it's I guess it's actually beyond that people
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Speaker 3: are buying the hype. No, I take that back. The
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Speaker 3: hype is that it's going to do what previous Elon
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Speaker 3: Musk companies have done in terms of stock market performance.
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Speaker 3: I don't think anybody is all that into the nitty
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Speaker 3: greedy details of what SpaceX will become in the future.
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Speaker 2: Well, let's let's talk about the different pieces and see
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Speaker 2: if there's some hype there. I think I think this
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Speaker 2: is a good exercise stock market performance, certainly. I think
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Speaker 2: there's the expectation from a lot of people that this
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Speaker 2: thing is gonna go nuts. You don't you don't get
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Speaker 2: interested in buying a stock if you think it's gonna
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Speaker 2: just sit there right at least I don't like personally.
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Speaker 2: Other pieces. Are people hyped up about starlink and what
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Speaker 2: that business can.
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Speaker 3: Be pretty profitable. I think there's some growth, Yeah, I
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Speaker 3: think they're excited about that.
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Speaker 2: Sure, Uh, data centers in space I think there's some
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Speaker 2: hype there. I'm not saying I'm not talking about whether
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Speaker 2: the hype can be realized, but there's definitely some chatter
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Speaker 2: about Sure. Uh, the current Xai data center business that
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Speaker 2: is basically now trying to rent out servers that they
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Speaker 2: were unable to fulfill the demand for themselves.
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Speaker 3: I think people see value in it, but I don't
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Speaker 3: think they're incredibly It's not an exciting business model.
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Speaker 2: Mining stuff on asteroids in the.
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Speaker 3: Moon exciting business model and completely impossible to value mars.
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Speaker 3: I'm serious.
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Speaker 2: I'm asking you if there's hype about this, I don't
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Speaker 2: see any. So where is the most hype. It's it's
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Speaker 2: the share pace, It's it's this thing is gonna go nuts?
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Speaker 3: Yeah?
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Speaker 2: And what else is if if if you had to
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Speaker 2: rank like a second hype hype thing, what's second in
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Speaker 2: the SpaceX hype rankings. I'm gonna go with data centers
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Speaker 2: in space. I guess I'm gonna go with data. I'm
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Speaker 2: not saying it like it's likely to happen. I'm saying
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Speaker 2: that's the thing that I feel is being hyped more
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Speaker 2: than moon mining.
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Speaker 3: So I guess the hype most this is tied to
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Speaker 3: stock market performance, but to me it's purely Elon Musk.
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Speaker 2: So now the question is can SpaceX live up to
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Speaker 2: that multi trillion dollar hype? And if we're talking about
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Speaker 2: the thing that we just said is the most hypable, it's, hey,
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Speaker 2: this stock is gonna go crazy. And that's actually the
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Speaker 2: toughest put in my opinion, not that like getting to
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Speaker 2: Mars is easy because we've never sent a person there.
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Speaker 2: It's actually really hard to get to Mars. There's like
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Speaker 2: two times a year where it's even like possible, and
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Speaker 2: even then, remember all the planets are moving at different speeds.
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Speaker 2: So what you do is you launch your spaceship out
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Speaker 2: there at this big empty space in the Solar System
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Speaker 2: and you're pretty rare there no, and you're hoping that
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Speaker 2: Mars is going to cross that spot when you get there,
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Speaker 2: Like you're not aiming at a stationary.
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Speaker 3: Target, like Dwayne Gretzky said.
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Speaker 2: Yes, you have to skate to where the Mars is going.
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Speaker 2: I believe that was his famous quote. So the stock price,
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Speaker 2: we've talked about this that the problem that you have
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Speaker 2: with the stock price is this when you're already a
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Speaker 2: two trillion dollar company if that's what the IPO at
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Speaker 2: even just comparing this to Tesla, which again Elon Musk company,
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Speaker 2: So you know, I think it's it's it's worth comparing
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Speaker 2: Tesla ipode at a one point five billion dollar valuation,
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Speaker 2: it's now one point five trillion, which means doing the math,
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Speaker 2: it's gone up a thousand x since in iPod. For
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Speaker 2: SpaceX to do the same thing, it needs to within
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Speaker 2: a fifteen year period, be a one point five quadrillion
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Speaker 2: dollar company. Now, if you've never heard the term quadrillion,
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Speaker 2: you're not alone, because right now the world economy is
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Speaker 2: around one hundred trillion dollars in any particular year.
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Speaker 3: That's why we're going for the Universe economy.
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Speaker 2: And so to get to one point five quadrillion.
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Speaker 3: Milky Way Gallony milky Way economy.
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Speaker 2: Would be you know, kind of a big place to
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Speaker 2: get to. So I think that the question that's out
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Speaker 2: there is, hey, at what level of performance would investors
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Speaker 2: be happy? And it's it's just a tough put when
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Speaker 2: you're a company this big to even like even to
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Speaker 2: go like ten x, what you're gonna be a twenty
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Speaker 2: trilli million dollar company? Where's the money going to come
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Speaker 2: from in order to funnel into that is a reasonable question.
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Speaker 3: Yeah, I think a few things to keep in mind
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Speaker 3: about this specific IPO, but IPO is generally one. It's
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Speaker 3: very normal for them to have wild first days, and
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Speaker 3: it's also incredibly normal for them to have pretty serious
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Speaker 3: declines in the first six months to a year of trade.
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Speaker 3: Sure you have all these remember what's going on with SpaceX.
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Speaker 3: What an IPO actually is. They're taking five percent of
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Speaker 3: their company and letting you buy it. They're telling the
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Speaker 3: other ninety five percent that you can't sell it for
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Speaker 3: the first six to twelve months, depending on who you are. Yes,
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Speaker 3: eventually though you can. And there's some pure economics there
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Speaker 3: of what can happen during those periods of time when
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Speaker 3: those quote lock up periods expire. And sometimes what happens
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Speaker 3: is a bunch of people flood the mark of the
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Speaker 3: shrifes because they want liquidity. We've seen that with plenty
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Speaker 3: of companies who have got on public even recently, like
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Speaker 3: even successful ones. Right you brought up this morning, Chock,
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Speaker 3: so I'll repeat it, core Weave. How much did they
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Speaker 3: go down in their first six months of trading? They
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Speaker 3: like the max draw down on those shares.
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Speaker 2: Not in the first six months, and like the first
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Speaker 2: six weeks they were down like sixty percent.
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Speaker 3: And then it rallied three hundred. But you know, these
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Speaker 3: things do happen, especially in early trading with new companies.
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Speaker 2: Even companies that will get palenteer, which is you know
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Speaker 2: this this darling, it's first twelve months it saw a
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Speaker 2: fifty three percent draw down, but still finished up one
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Speaker 2: hundred and fifty three percent for the twelve month period.
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Speaker 3: Asking can you hang on?
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Speaker 2: Do you like roller coasters? Is the question to ask. Now,
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Speaker 2: you know you take a look another one Arm holdings,
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Speaker 2: chip maker IPO two three years ago went through a
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Speaker 2: forty three percent draw down in year one, still finished
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Speaker 2: year one up one hundred and thirty two percent. Now
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Speaker 2: you might be like, yeah, like that's great. I Well, okay,
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Speaker 2: there's the counter to it. Let's talk about Rivian Rivian
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Speaker 2: iPod went up forty five percent, then fell eighty eight
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Speaker 2: percent from its IPO price, finished down sixty seven percent
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Speaker 2: year one. Now again, you have no idea where these
12:17
Speaker 2: things are going to end up other than the ride
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Speaker 2: is going to be crazy. In most cases, these are
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Speaker 2: not slow growth compounders. These are highly volatile things that
12:28
Speaker 2: are going to move a ton in both directions at
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Speaker 2: different points. Quick break. When we come back, we've got trivia. Next.
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Speaker 4: Hi had Time for Surevia here on the Financial Exchange
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Speaker 4: and the twenty twenty six World Cup begins later this week. France,
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14:12
Speaker 2: Tucker, what did hang on? What I'm going to tell you?
14:19
Speaker 3: Now?
14:19
Speaker 2: What did you say? France was trying to defend their title?
14:23
Speaker 2: That's what it says right here on this copy. They're
14:25
Speaker 2: not oh, Argentina won the last one bad. I'm not
14:31
Speaker 2: saying I'm just saying like, this is one that again.
14:34
Speaker 2: The twenty twenty two final is one of the great
14:36
Speaker 2: soccer games in history.
14:38
Speaker 3: Yeah, shows that none of us know anything about soccer, and.
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Speaker 2: It was won by Argentina.
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Speaker 3: Sure about that.
14:45
Speaker 2: Yes, France did win the twenty eighteen title, so it's
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Speaker 2: possible there is.
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Speaker 4: In the final right in twenty twenty two.
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Speaker 2: Yes, France has been in back to back finals and
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Speaker 2: three out of the last five where to go, but
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Speaker 2: they did not win. Uh, Argentina, So yes, Argentina. Next,
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Speaker 2: let's see people love working from home, but does it
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Speaker 2: love them back? Does what love them?
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Speaker 3: Back?
15:10
Speaker 2: Home?
15:10
Speaker 3: Active? Working from home?
15:13
Speaker 2: Hey, I'm your active working from home and I wanted
15:15
Speaker 2: you to know that I love you. So I think
15:19
Speaker 2: what we're asking here is people love working from home,
15:22
Speaker 2: but does work love them working from home?
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Speaker 3: I think what it's actually asking is people love working
15:28
Speaker 3: from home, but is it actually good for their health
15:33
Speaker 3: and careers? And the answer, more and more seemingly is
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Speaker 3: not so much. This study which I don't know who
15:42
Speaker 3: actually did this, but there's been a number of studies
15:46
Speaker 3: looking at it. They are not all funded by Amazon
15:50
Speaker 3: and JP Morgan, which would be funny, but Federal Reserve
15:54
Speaker 3: Bank of New York looking at a number of these
15:55
Speaker 3: studies and concluding that, you know, while willers workers are
16:00
Speaker 3: willing to give up some of their pay in order
16:02
Speaker 3: to work from home, the conclusions that studies have done
16:06
Speaker 3: seemed that workers become more socially isolated, anxious, and depressed
16:11
Speaker 3: compared to people who work in the office and other settings,
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Speaker 3: which again sounds like it was a study sponsored by
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Speaker 3: Amazon and JP Morgan. But I can kind of see
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Speaker 3: how you get there and then didn't even look at
16:22
Speaker 3: the piece of this, which is I suspect it's probably
16:24
Speaker 3: pretty bad for your career development too.
16:27
Speaker 1: Well.
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Speaker 2: I think it depends on the company that you, of course,
16:29
Speaker 2: Like I can't just go and say like this is
16:33
Speaker 2: good or this is bad, because there's plenty of stuff
16:36
Speaker 2: that I'm willing to bet like if you looked at
16:39
Speaker 2: human history and brought someone from like the eighteen forties
16:43
Speaker 2: into today's labor market, they'd be like, oh, no, you're
16:47
Speaker 2: doing this this way, Like that's bad. You can't you
16:49
Speaker 2: can't do that that way, Like no, you're supposed to
16:52
Speaker 2: take like a two hour break for lunch, Like what
16:55
Speaker 2: gives why are you not doing that? Or hey, how
16:58
Speaker 2: come you don't all go out to the pub after
17:00
Speaker 2: like every day of work? You know what's the deal?
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Speaker 3: Clearly, I think that's the case when it comes to
17:06
Speaker 3: career development, right, It very much depends on the company,
17:09
Speaker 3: the structure of how it's set up. But I would buy,
17:12
Speaker 3: you know, assuming that these studies were done properly. That yeah,
17:16
Speaker 3: working full time remote, while the experience on your career
17:21
Speaker 3: development can vary company by company, might not be best
17:23
Speaker 3: for your mental health on average, I can see how
17:26
Speaker 3: that would be isolating.
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Speaker 2: It probably depends on again, like where you live and
17:30
Speaker 2: what else you're.
17:31
Speaker 3: Doing, if course, but if we're taking averages here and
17:34
Speaker 3: just saying, hey, look, working from home full time leads
17:37
Speaker 3: to socially isolated people, like I kind of buy that.
17:41
Speaker 2: I don't like I gotta be honest, I don't hang
17:43
Speaker 2: out with.
17:43
Speaker 3: People from work, But you interact with human beings like
17:50
Speaker 3: outside of work, you know, just in work, you interact
17:53
Speaker 3: with human beings. And I think there is, as we
17:55
Speaker 3: have noticed with children and all sorts of other demos,
18:00
Speaker 3: just interacting with people over a screen or via email
18:03
Speaker 3: or via zoom is not the same as having human
18:06
Speaker 3: interactings with people. And I think that we Yeah, I
18:11
Speaker 3: think that's a kind of important lesson.
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Speaker 2: I'm I'm just hesitant to draw too much from like
18:19
Speaker 2: three from home socks and you should never happen, ever, again, like,
18:23
Speaker 2: I just don't know how much we know, is the point.
18:27
Speaker 2: I'm not saying it's like good or bad. I'm just
18:29
Speaker 2: saying I don't think we really know much yet, and
18:35
Speaker 2: I don't know what we would do to try to
18:39
Speaker 2: replicate this and say like, yes, like this is clearly
18:41
Speaker 2: like the result that you get when this is happening,
18:46
Speaker 2: you know, Like just as an example, there's like one
18:49
Speaker 2: of the stats in here is like, Okay, there is
18:52
Speaker 2: an increase in visits to mental health providers for those
18:56
Speaker 2: that are working from home. Well, how do we know
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Speaker 2: that's causation and not correlation. What if the people who
19:02
Speaker 2: are more prone to mental illness, what if they prefer
19:06
Speaker 2: working from home because they don't like the social contact.
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Speaker 3: I get it.
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Speaker 2: I just I'm not sure how to square this. But look,
19:17
Speaker 2: I don't know experience.
19:19
Speaker 3: Socially isolated people, whether by choice or because of work,
19:24
Speaker 3: seem worse off to me than people are forced into
19:28
Speaker 3: social scenarios.
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Speaker 2: But maybe that's because we shouldn't be making work the
19:31
Speaker 2: focus of our social life. Maybe Quick Break Wall Street
19:34
Speaker 2: watches Next.
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19:58
Speaker 4: All after last Friday's tech sell off, markets are opening
20:01
Speaker 4: the new week in positive territory and rebounding. As for
20:05
Speaker 4: the Middle East oil prices, we're up by five percent
20:09
Speaker 4: earlier this morning after a RN and Israel exchange military attacks. However,
20:12
Speaker 4: prices have sinced ease since Iran set its military operations
20:17
Speaker 4: against Israel. We're over right now. The Dow is up
20:20
Speaker 4: now only thirty five points, SMP five hundred up two
20:23
Speaker 4: thirds of a percent, Nasdaq up about one and a
20:26
Speaker 4: quarter percent, or three hundred and twenty five points. RUSS
20:29
Speaker 4: two thousand is up one point seven percent, Tenure Treasure.
20:32
Speaker 2: Reeled up two basis points at.
20:34
Speaker 4: Four point five five percent, and Oil up about one percent,
20:38
Speaker 4: training at ninety one dollars a barrel. Marvel rallying thirteen percent,
20:42
Speaker 4: fallowing news that the chip maker will join the SMP
20:45
Speaker 4: five hundred later this month. Meanwhile, Amazon announced it will
20:48
Speaker 4: pay Corning billions of dollars for optical fib Or two
20:52
Speaker 4: power and connect It's rapidly expanding AI Data Centers Corning
20:56
Speaker 4: shares are up by six percent. Elsewhere, Alphabet's Google recently
21:00
Speaker 4: placed an order with Intel to manufacture more than three
21:03
Speaker 4: million of its specialized AI chips in twenty twenty eight.
21:07
Speaker 4: That according to a report from The Information Intel rallying
21:11
Speaker 4: twelve percent on that news. And Apple will hold its
21:14
Speaker 4: final Worldwide Developers Conference this afternoon with Tim Cook at
21:18
Speaker 4: the helm. The tech giant is expected to unveil a
21:21
Speaker 4: revamp Serie Digital Assistant, along with other AI features. Apple
21:26
Speaker 4: stock is up two percent ahead of that conference. I'm
21:31
Speaker 4: Tucker Silvan. That is Wall Street Watch, And on the
21:33
Speaker 4: previous segment, we asked you the trivia question which country
21:36
Speaker 4: has won the most World Cup championships? That would be
21:39
Speaker 4: Brazil and Jeff and Winchester Mass is our winner today
21:43
Speaker 4: taking on a Financial Exchange Show t shirt. Congrats to
21:46
Speaker 4: Jeff and we play trivia every day here on the
21:49
Speaker 4: Financial Exchange. See complete contest rules at Financial Exchange Show
21:54
Speaker 4: dot com.
21:55
Speaker 2: The other piece about Brazil, they've also lost two World
21:59
Speaker 2: Cup finals. They are the only country actually, you know,
22:03
Speaker 2: Germany's also made it to I think seven maybe eight,
22:07
Speaker 2: but the two of them have made the most World
22:11
Speaker 2: Cup finals. So there's that the Italians are a close third.
22:15
Speaker 2: The Italians have won four times and lost twice, but
22:19
Speaker 2: unfortunately won't be competing in back to back World Cups
22:22
Speaker 2: now because Hey, here's the thing about US. Italians better
22:26
Speaker 2: at baseball now. Occasionally we just get so dysfunctional that
22:29
Speaker 2: we can't even make it there. So that's what happened
22:32
Speaker 2: this time. Suppresso machine was broken. Yeah, sorry, guys. Retirees
22:37
Speaker 2: fear running out of money. Many are spending too little instead.
22:42
Speaker 2: Gotta say, it's not often that I see financial planning
22:45
Speaker 2: pieces that talk about this, but I actually think it's
22:49
Speaker 2: nice when they do.
22:50
Speaker 3: Okay, so let's talk about the real problem here, because
22:54
Speaker 3: if you underspand the real problem that you're left with
22:57
Speaker 3: is you leave a bigger inheritance than you probably planned for.
23:00
Speaker 2: So I, you know, compared to running out of money
23:02
Speaker 2: and you passed up on things that you might have
23:04
Speaker 2: been able to do, yeah, but couldn't because you thought
23:08
Speaker 2: they would be too expensive for you.
23:10
Speaker 3: Yes, and I think there obviously can be some remorse there.
23:15
Speaker 3: But again, compared to the idea of being stressed in
23:17
Speaker 3: your eighties and like having to for sell your home
23:21
Speaker 3: later in life, I will take the first problem over
23:24
Speaker 3: the other one, but yet we probably do see it.
23:28
Speaker 3: The bigger problem that I have, though, is a lot
23:31
Speaker 3: of those people like when you talk to them about
23:34
Speaker 3: their capacity for spending, like, hey, this is what your
23:37
Speaker 3: portfolio could afford you. I meet very few people who
23:41
Speaker 3: are like, spending that extra money would make them happy? Yeah,
23:48
Speaker 3: Like I haven't. I think knowing that they could spend
23:51
Speaker 3: the money makes them happy. Sure, but I don't meet
23:53
Speaker 3: a lot of people who are like, oh, thank god
23:55
Speaker 3: you told me I'm such a happier person now that
23:58
Speaker 3: I'm spending an extra five thousand dollars per year.
24:01
Speaker 2: I would agree. It's the vast majority of people that
24:04
Speaker 2: you talk to about this, you get great, Well, we'll
24:08
Speaker 2: use it if we need to, Sure, but we don't
24:11
Speaker 2: see the need to make any changes right now.
24:12
Speaker 3: Yeah. Now, there are other types of risks out there
24:15
Speaker 3: when it comes to this, Like what I see very
24:17
Speaker 3: frequently is people being dishonest with themselves and their personal
24:23
Speaker 3: advisors about how much they are going to spend in
24:26
Speaker 3: the future. Yes, and I've seen this cut both ways.
24:28
Speaker 3: And if you underestimate it, then you run out of money.
24:30
Speaker 3: If you overestimate it, though, Like let's say you tell
24:33
Speaker 3: you budget and you say you're going to spend seventy
24:37
Speaker 3: thousand dollars a year and then you spend fifty, Well,
24:41
Speaker 3: then you are in many cases, like not making the
24:46
Speaker 3: right tax maneuvers at this point in time for what
24:49
Speaker 3: your life is actually going to be like. And so
24:53
Speaker 3: I've made a lot of people who just like to,
24:54
Speaker 3: you know, hey, let's put it the peg here, but
24:56
Speaker 3: we actually know we're going to be here.
24:58
Speaker 2: Uh.
24:59
Speaker 3: That's all great when you're doing it for other purposes,
25:01
Speaker 3: but when you're doing it for things like tax planning,
25:03
Speaker 3: it can actually screw you up pretty badly.
25:05
Speaker 2: It can, I will say spending in general, I'm very
25:09
Speaker 2: much of the belief at this point. You know, we
25:12
Speaker 2: just talked about, Hey, if you tell someone they can't
25:14
Speaker 2: spend more money, oftentimes they won't. The opposite is true too,
25:18
Speaker 2: if you tell someone they need to spend less money,
25:21
Speaker 2: oftentimes they won't. It's like water finds its own level
25:24
Speaker 2: on this just because we get accustomed to it in
25:26
Speaker 2: the habits. It takes a lot of work to change
25:29
Speaker 2: spending habits.
25:30
Speaker 3: Yeah, it does.
25:30
Speaker 2: And usually something going either very wrong or very right
25:34
Speaker 2: in order to really get you to shift things.
25:36
Speaker 3: Obviously, these spending patterns, they're all circled and centered around
25:42
Speaker 3: retirement and that comfortability with spending money when you no
25:47
Speaker 3: longer have money coming in a huge piece of this
25:50
Speaker 3: and frankly, two of the most commonly asked questions we
25:53
Speaker 3: as advisors get surround the topics of social security and medicare.
25:59
Speaker 3: They're these unknown programs because unless you've been on them,
26:02
Speaker 3: you don't know the intricacies of how they work. The
26:05
Speaker 3: security side of things has changed quite a bit in
26:08
Speaker 3: the last five years, especially if you've been a public worker,
26:11
Speaker 3: but you know the rules around what happens if I
26:14
Speaker 3: lose a spouse, if I'm divorced, and you know how
26:18
Speaker 3: all of these things operate. If I am terminated from
26:21
Speaker 3: work before sixty five, all of these things end up
26:24
Speaker 3: working together, and they are immensely complicated. And for that reason,
26:28
Speaker 3: we're putting on a seminar in person down in Quincy
26:32
Speaker 3: at the end of the month. It's gonna be on Thursday,
26:34
Speaker 3: June twenty fifth. It's at five pm, so you can
26:37
Speaker 3: hit it on your way out of the city after work.
26:39
Speaker 3: But we're gonna be presenting on the two topics of
26:41
Speaker 3: Social Security and Medicare. It's sponsored by the Armstrong Advisory Group.
26:45
Speaker 3: It is free to attend, and the goal is to
26:47
Speaker 3: really answer those questions that you have about the complexity
26:50
Speaker 3: of these two programs and how they actually work for
26:54
Speaker 3: people in the area. If you'd like to attend, it
26:57
Speaker 3: is free to attend, but you must register ahead of time.
27:00
Speaker 3: I'm the place to go is Armstrong Advisory dot com
27:03
Speaker 3: Slash events again. It's in Quincy on Thursday, June twenty fifth,
27:08
Speaker 3: five pm. Register for free at Armstrong Advisory dot com
27:12
Speaker 3: slash Events.
27:13
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
27:16
Speaker 1: registered investment advisor. Nothing in the ad or in any
27:18
Speaker 1: Armstrong guide a specific financial, legal or tax advice. Consult
27:21
Speaker 1: your own financial, tax into state planning advisors before making
27:24
Speaker 1: any investment decisions. Armstrong may contact you to offer investment
27:27
Speaker 1: advisory services.
27:29
Speaker 2: I want to pick up on this piece from the
27:30
Speaker 2: New York Times. It's titled customers are giving billions to
27:34
Speaker 2: scammers and tellers are intervening.
27:38
Speaker 3: Thank God, because for a while they either were told
27:41
Speaker 3: they couldn't or didn't know how. Or this is fairly recent,
27:45
Speaker 3: believe it or not.
27:46
Speaker 2: So I'm going to read from here. Just before closing time,
27:48
Speaker 2: on a cold February afternoon, one of a long time
27:50
Speaker 2: one of a teller's longtime customers, then eighty one and
27:53
Speaker 2: recently windowed, walked up to Miss Batista's station. The woman
27:57
Speaker 2: needed to transfer nine thousand dollars into a new account.
28:01
Speaker 2: She sled a debit card onto the reader on the counter,
28:03
Speaker 2: but when Miss Batista searched for the new account under
28:05
Speaker 2: her name, nothing came up. What the customer shared next
28:09
Speaker 2: provided some clues. Before coming in, she said she got
28:11
Speaker 2: a call from Chase, at least that's what it said
28:13
Speaker 2: on her cellphone's caller ID. The caller asked if she
28:16
Speaker 2: had made three transfers for one thousand dollars each via Zell,
28:20
Speaker 2: the bank's digital payment service, something she had never used.
28:23
Speaker 2: And it goes on then to say that pretty much
28:27
Speaker 2: she got transferred to someone else that said that the
28:29
Speaker 2: bank would open a new account, that she had to
28:30
Speaker 2: move the money in, blah blah blah, and the teller
28:35
Speaker 2: was basically like yes, like this is a huge scam,
28:37
Speaker 2: like you need to not do this. And it talks
28:40
Speaker 2: about a couple of tellers at this branch who have,
28:42
Speaker 2: you know, basically done this. And as Mike said, look
28:47
Speaker 2: for a long time, tellers were not allowed.
28:50
Speaker 3: Yeah. I think they just were not empowered to interfere
28:52
Speaker 3: with this sort of thing.
28:53
Speaker 2: No, but this is something that continues to pop up
28:56
Speaker 2: more and more. And so what you have scene is
29:01
Speaker 2: that banks are starting to hire people that specialize in
29:05
Speaker 2: behavioral science in order to train their tellers how to
29:09
Speaker 2: spot the signs that someone is getting scammed, to at
29:13
Speaker 2: least help on the margin when someone comes into a
29:15
Speaker 2: bank to try to move money in a fraudulent manner.
29:21
Speaker 3: I mean, aside from the fact that billions of dollars
29:23
Speaker 3: are being scammed away, here are the problems with this
29:28
Speaker 3: entire space. We, for good reason, treat money, bank accounts,
29:35
Speaker 3: investment accounts very privately. We don't like talking about money,
29:39
Speaker 3: even with family. It's a taboo subject. You don't bring
29:43
Speaker 3: it up at the dinner party. And for that reason,
29:45
Speaker 3: the entire industry is built around this privacy. And if
29:48
Speaker 3: you're going to protect people against themselves, the only way
29:51
Speaker 3: to do so is by stealing a little bit more
29:56
Speaker 3: of that privacy away from that person.
29:58
Speaker 2: Right.
29:58
Speaker 3: The reason that the bank tellers weren't in powered to
30:00
Speaker 3: do it is because it was a private matter. You
30:02
Speaker 3: don't ask people about what they're doing with their money. Yep,
30:04
Speaker 3: that's the whole reason. It was this respect thing where like, hey,
30:07
Speaker 3: if somebody comes into the bank, it's their money, we're
30:10
Speaker 3: just here to hold it for them. You don't ask
30:12
Speaker 3: somebody about what they're doing with their money. And if
30:14
Speaker 3: you're going to prevent this sort of thing, that's the
30:17
Speaker 3: main way to do it. You know, somebody's calling you
30:19
Speaker 3: for money, and what you do to prevent it from
30:22
Speaker 3: being sent to the wrong person is he ask some questions,
30:25
Speaker 3: Oh cool, are you going on a vacation? What's happening
30:28
Speaker 3: with this? How you try and detect why the person
30:31
Speaker 3: is moving nine thousand dollars to some stranger's bank account,
30:35
Speaker 3: and hopefully you uncover situations like this, which sounds like
30:38
Speaker 3: it was fairly easy to detect. But man, anybody that
30:42
Speaker 3: doesn't work in this space. We see it every day,
30:46
Speaker 3: and the only real way to prevent it is somebody
30:49
Speaker 3: else other than the person in control of it being
30:52
Speaker 3: involved and removing some of that privacy from that person
30:55
Speaker 3: who has had control for the whole time.
30:57
Speaker 2: To take a quick break, and when we return stack Roulettes.
31:03
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31:31
Speaker 4: The Financial Exchange is a proud partner of the Disabled
31:34
Speaker 4: American Veterans Department of Massachusetts registered today for this year's
31:38
Speaker 4: DAV five k on Saturday, November seventh at Fort Independence
31:42
Speaker 4: on Castle Island. If you're not able to participate, you
31:46
Speaker 4: can still support our great American heroes by visiting DAV
31:49
Speaker 4: fivek dot Boston and making a donation today. Your participation
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Speaker 4: and safe housing for single veterans in their families. Donate
32:01
Speaker 4: today a DAV five k dot Boston. That's DAV five
32:05
Speaker 4: k dot Boston. Mike, what do you got for me
32:07
Speaker 4: for stack Roulette, Chuck?
32:09
Speaker 3: I have the exciting new product of the year, which
32:12
Speaker 3: is a butter churning running vest that was created by
32:17
Speaker 3: a Canadian dairy brand. Long story short. You have these
32:22
Speaker 3: little pouches, fill them with heavy cream as well as
32:26
Speaker 3: a kinetic ball, and after ten kilometers of running, presumably
32:30
Speaker 3: in the Arctic Canadian cold, you will have butter. You're
32:35
Speaker 3: gonna churn butter as you run. There's not much in
32:38
Speaker 3: the way of cost savings on this, unfortunately, because butter
32:41
Speaker 3: is really cheap and heavy cream is not so much
32:44
Speaker 3: unless you're gonna start maybe reselling the butter cream. But yeah,
32:49
Speaker 3: this is the product of the year in my household.
32:52
Speaker 2: A couple things on this, Yeah, Number one, I love butter.
32:56
Speaker 3: Wait no, this is why I picked the story, Jock.
32:59
Speaker 2: Number two. The cream does not go directly into the vest.
33:05
Speaker 2: That would be gross. Yes, you put it in a
33:08
Speaker 2: container inside of the vest, but is not contam It
33:13
Speaker 2: does not go directly into the vest. Tarn this one.
33:18
Speaker 2: Other things. They're not selling these. There's ten of them
33:23
Speaker 2: that they're making, and you have to enter a contest
33:25
Speaker 2: to win one.
33:26
Speaker 3: I've already entered your name three different ways, Jack.
33:29
Speaker 2: I wonder how many different email addresses I can get
33:32
Speaker 2: in order to enter this. Finally, some guidance that they
33:36
Speaker 2: have Number one Because cream is highly perishable, it should
33:40
Speaker 2: not be left unrefrigerated for more than two hours, So
33:42
Speaker 2: limit your runs to under two hours ten kilometers.
33:45
Speaker 3: Okay, I better be able to do that in two hours.
33:46
Speaker 2: Number two, keep your cream chilled until the moment that
33:50
Speaker 2: you head out, so don't like set it out with
33:52
Speaker 2: your clothes the night before.
33:53
Speaker 3: Yeah, that makes sense.
33:55
Speaker 2: Number three, postpone your butter churning running activity if temperatures
34:01
Speaker 2: exceed eighty six degrees fahrenheit. Yeah, so you can only
34:06
Speaker 2: do this eighty five or below.
34:09
Speaker 3: Again Canadian company, that says a good majority of the year.
34:12
Speaker 2: So I'm excited. I'm hoping to get one of these.
34:16
Speaker 3: Well, this actually gets my brain move in here. I
34:18
Speaker 3: see people walking in those weighted vests all the time. Yeah, okay,
34:22
Speaker 3: practicalities here. It doesn't look like churning butter is going
34:25
Speaker 3: to be a terribly profitable endeavor on this. But like,
34:30
Speaker 3: can I charge a battery?
34:33
Speaker 2: No?
34:33
Speaker 3: Like running? Yeah, I mean I'm sure that somebody could
34:36
Speaker 3: build a battery that. Absolutely, I could charge a battery
34:40
Speaker 3: while running and the up and down motion charging that battery.
34:43
Speaker 3: I think that's a better use for this sort of thing.
34:46
Speaker 2: No, definitely, butter, definitely butter. What if you use the
34:51
Speaker 2: running to charge the battery and then use the battery
34:55
Speaker 2: to power your butter churn?
34:56
Speaker 3: Yeah at home again. Stick of butter really cheap to
35:01
Speaker 3: the heavy cream, you know, also pretty cheap, but not
35:07
Speaker 3: not a profitable endeavor. But I like the bat I'm
35:09
Speaker 3: I'm gonna look into a battery charging running vest. I
35:12
Speaker 3: like that idea better.
35:14
Speaker 2: Driverless trucks are here and they're delivering bags of but doritos.
35:19
Speaker 2: They's how many bags of butterdeo by each weekend?
35:22
Speaker 3: You gotta start small dorados. I like, no national security
35:25
Speaker 3: concerns if the thing goes off the rails.
35:27
Speaker 2: So here's the deal. These are like, you know, big trucks,
35:31
Speaker 2: twenty six thousand pound trucks that are making these deliveries
35:37
Speaker 2: in Arizona. PEPSI owns thirty five of these things, and
35:42
Speaker 2: they are using these autonomous trucks on public roads, highways
35:48
Speaker 2: and local streets and pretty much are are starting to
35:54
Speaker 2: use these in a live network of vehicles to ship
35:59
Speaker 2: stuff locally in Arizona. They've also got five trucks on
36:04
Speaker 2: the road in Texas and one in Arkansas. The other
36:09
Speaker 2: thing I can think of on the Arkansas side of things,
36:12
Speaker 2: and he guesses, Mike, Walmart, that's my guess. Yeah, Arkansas,
36:17
Speaker 2: Bentonville is Walmart's headquarters. My guess is that there's some
36:21
Speaker 2: kind of simple route that they run to and from,
36:25
Speaker 2: like a regional distribution facility or something like that there.
36:28
Speaker 2: And it's exactly what you would think. It is a
36:30
Speaker 2: bunch of cameras and light ar that are set up
36:33
Speaker 2: and they've got these trucks that they are working with
36:37
Speaker 2: in the last four years in order to try to
36:41
Speaker 2: operate larger fleets of them. They've had no accidents on
36:44
Speaker 2: public roads so far, according to PEPSI, and they're trying
36:47
Speaker 2: to expand the use of these vehicles to additional locations.
36:51
Speaker 2: And this is why I do think, as I said
36:54
Speaker 2: a couple of weeks ago, listen, if you're in your
36:56
Speaker 2: twenties and want a paying job for the next three
37:01
Speaker 2: to five years, there's all kinds of opportunities in the
37:03
Speaker 2: trucking industry because of changes and regulations that are creating
37:07
Speaker 2: a shortage of drivers.
37:08
Speaker 3: Yeah, hey, I think the way this goes, I don't
37:11
Speaker 3: know that every truck is going to be doing this
37:13
Speaker 3: sort of thing anytime soon. It seems like it's not.
37:15
Speaker 3: But in the nineteen sixties, how many pilots had to
37:18
Speaker 3: be in the cock pilot for a long haul flight,
37:20
Speaker 3: like five or aviation experts had to be in there,
37:23
Speaker 3: And we've gotten down now to like two or three,
37:25
Speaker 3: depending on the long haul flight. Sure, in trucking, it's
37:28
Speaker 3: not the same thing. You don't have multiple people operating
37:30
Speaker 3: the truck, but you do have strict time limits because
37:33
Speaker 3: the person needs to sleep and can't be on the
37:35
Speaker 3: road for that long. I think what this technology does
37:37
Speaker 3: is extend those time limits. Hey, if you're on the highway,
37:40
Speaker 3: you can sleep in the back of the truck and
37:43
Speaker 3: still you know, satisfy your actually driving time because they
37:46
Speaker 3: get that good at certain types of driving.
37:49
Speaker 2: So this is again, eventually we're moving in this direction.
37:53
Speaker 2: I still think when you talk about large portions of
37:56
Speaker 2: the country that are not as easy to get around
37:58
Speaker 2: as Arizona, it's gonna be a bit of a bit
38:01
Speaker 2: of a longer putt. But hey, it's it's where we're going.
38:05
Speaker 2: Let's take a quick break for the rest of the day.
38:07
Speaker 2: We will see you back here tomorrow. On the Financial
38:10
Speaker 2: Exchange