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Why are economists warning of new inflation hazards? · The Financial Exchange Show

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Veterans Development Corporation. This is the Financial Exchange, with Chuck
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Zada and Mike Armstrong.
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Speaker 2: Kicking off hour two of the Financial Exchange.
1:15
Speaker 3: Today, it's Chuck, Mike and Tucker and stock's broadly in
1:20
positive territory here with the Dow up three hundred points,
1:23
the S and P five hundred twenty five, and the
1:25
NASDAG up ninety two, so about a half a percent
1:28
jump in equities. To kick things off today, you've got
1:32
the ten year US Treasury continuing its sell off, now
1:36
up another three point two basis points to four point
1:38
two six four percent, so closing in on you know,
1:42
seven tens of a percent, rising a seven tens of
1:45
a percent rise since the FED began cutting interest rates.
1:49
We also have oil, the big move down today, currently
1:53
down five point one seven percent, about three seventy one
1:56
on West Texas Intermediate.
1:58
Speaker 2: This on the back of.
1:59
Speaker 3: The Israeli strikes of Iranian military sites on Friday evening.
2:07
The oil market interpreting this and the Iranian response as
2:11
something that at least in the short term, takes away
2:13
some of those worst case scenarios as far as potential escalation.
2:17
We'll see where this goes over the course of the day.
2:19
As far as oil prices, at one point West Texas
2:22
Intermediate was down about six and a half percent, So
2:25
it's rallied off those lows.
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Speaker 2: We'll see where it ends up going here.
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Speaker 3: Also, the TRIPAA national average for gas prices continuing to
2:33
slide now at three point thirteen nationally. With this move
2:37
on West Texas Intermediate, within the next couple of weeks,
2:40
you would expect to be seeing the national average making
2:44
a run for a two in the first digit. We
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got a potential you know, two ninety five to two
2:49
ninety eight siting coming up in the next couple of weeks.
2:52
If oil prices are able to hold in this range again,
2:56
we'll see if they actually do. Gold up to eighty
2:59
one ounce despite the you know, general kind of risk
3:03
off sentiment related to the Middle East gold saying, hey,
3:06
that's not where my bid is entirely coming from. And
3:08
so gold holding its ground pretty well today up to
3:11
ten and ounced to twenty seven fifty six and seventy cents. Mike,
3:15
anything else catching your eye?
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Speaker 4: Not market related?
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Speaker 2: Now what else is catching your eye? It's not market related?
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Speaker 4: This piece from Nick Timrouse in the Journal here economous
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is maybe like a deal on lunch or something. I
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am looking for a deal on lunch. Do you got
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any idea?
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Speaker 3: No, I brought a turkey sandwich and I'm gonna be
3:31
wholly unsatisfied with it. Was one of those I'm unpacking
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the turkey this morning and I'm like, you know, you know,
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just a turkey.
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Speaker 2: It just didn't feel good in part of it.
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Speaker 4: Last week I got a part in your hands.
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Speaker 3: No, last last week I had the best turkey man Like,
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I was like, oh, this this is the good stuff,
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you know, like loaded up this one.
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Speaker 2: I'm looking at him like wimpy turkey.
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Speaker 3: Kind of Rubbery's not sure if it's gonna work for me.
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But anyways, Nick tim Morous is.
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Speaker 4: Saying economists warn of new inflation hazards after election. So
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I want to talk about in what world we actually
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need to worry about this. And the frustration that I
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have is it seems to me that our only criticism
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of irresponsible government behavior, and by that I mean spending
4:22
and not raising taxes to correspond to that spending and
4:24
running up deficits higher, seems to come from a point
4:27
of short term inflation. And I think that over the
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last fifty years, we've come up with enough evidence to
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say that increased government spending on its own does not
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uniformly increase inflation. You can get to a point where
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it does, at least not in the United States. You
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have very little evidence that that has been the case
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until you've reached really, really high levels of spending like
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we saw in the spring of twenty twenty. But even
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then you also had to have completely mangled supply chains
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to get you there. And so I just find it, well,
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I find it not good from the perspective of if
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this is our only criticism and it keeps failing as
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a realistic criticism, then nobody's gonna actually be worried about
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irresponsible government spending, which in my view, is a real
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problem for our future. Well, so first thing, let's tackle
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the first point first, which is, do you see anything
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that you've heard from the campaign trail that is realistically
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going to result in inflation in twenty twenty five the
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likes of which we saw anytime over the last four years. No,
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nor do I. And again it's not to say that
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I think the policies coming from either side of the
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campaign trail are good for our economy. I just don't
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think they're going to spark nine percent inflation. No.
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Speaker 2: I do think it's interesting that.
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Speaker 3: Look, if we're going to be intellectually honest about the
5:55
government spending side of things, when's the last time you
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actually had anyone running for president, not you know, the
6:05
House or the Senator, whatever, anyone running for president who
6:08
was serious McCain about managing the size of the deficits.
6:12
I did even give you Romney, okay, you know, like
6:15
Paul Ryan cut his bones being like, hey, I'm gonna,
6:18
you know, try to reign in federal spending. Yeah, and
6:21
like that. That was kind of a core thing there.
6:23
But ultimately, like it's been like at least twelve years
6:26
now since you had a candidate who was like, yeah,
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we need to really focus on this as a thing,
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because right now I got both campaigns promising to not
6:37
tax tips. Are both Is it just the Trump campaign
6:41
that's saying I'm not going to tax so security. Did
6:43
Harris go in on that too, I don't know at
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this point. Yeah, it's preposterous that ever pros on this.
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You just have you know, tax cuts being thrown around
6:51
left and right. You've got promises on additional spending. The
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Harris campaigns like I'm gonna do like twenty five thousand
6:57
dollars down payment assistance and build three million more homes.
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Speaker 4: Give all sorts of parents, you know, universal pre K
7:04
and right and pay childcare.
7:06
Speaker 2: Yeah.
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Speaker 3: The Trump campaign now was saying, Hey, in a perfect world,
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I'd love to get rid of the income tax.
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Speaker 2: Okay.
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Speaker 3: That's like me campaigning for seventh grade class presidents saying
7:12
that you're gonna get rid of homework.
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Speaker 2: Like, okay, good luck with that, you know.
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Speaker 3: Like, I just think we're in a world where we're
7:20
not being honest about what we need to do to
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get our deficits to a manageable size. I'm not saying
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you have to eliminate them, because remember, you know, I
7:30
hear all this talk, not all this talk, but you
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talk to people and you'll hear, well, you know, wouldn't
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it be great to run a surplus and listen. As
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much as I might dislike large deficits, surpluses are worse
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because that literally means that the government has taken in
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more money than it knows what to do with. It's like, hey,
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I don't like being taxed, but when I do, I
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like to be taxed, So much that the government can't
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spend all my money. No like that that's just not
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that's not good either. But I think there's a place where, hey,
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if you can get to running you know, one and
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a half to two and a half percent annual deficits
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instead of the five to seven percent annual deficits that
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we're seeing now. Yeah, that that's like a reasonable place
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to get to.
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Speaker 2: And the issue that you.
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Speaker 3: Run into on this from a long term inflationary perspective is, Hey,
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let's say that you have a situation like what we
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have now, which is, hey, federal government outlays on interest
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are going to be somewhere between thirty and forty percent
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of all revenue collected over the next several years. Right,
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so before you even get to spend a dollar on
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do D, do any anything else, Social Security, medicare, any
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of that stuff, Before you get to spend any of that, hey,
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thirty to forty percent of your tax revenue goes to
8:49
paying interest. So what it means is, hey, if you
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want to be reasonable about how to you know, rain
8:55
those deficits in, then it's going to come at the
8:57
cost of short term economic growth. Because as much as
9:01
we might say, look you don't want to try to,
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you know, just use government spending to grow the economy.
9:06
The fact is government spending still does grow the economy,
9:08
just not as efficiently as it does in the private sector.
9:12
Like you spend a dollar of government money, someone's still
9:14
getting that contract. So I think that when when we
9:19
try to be like intellectually honest about all of this,
9:23
it's something where the path towards getting these numbers sustainable
9:28
are Hey, it's going to take some pain from all
9:31
of us in some different ways.
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Speaker 2: In order to do so.
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Speaker 3: And we haven't really been good at stomaching political pain.
9:38
Speaker 4: No recently now, not a whole lot of politicians running
9:42
on the ask not what your country can do for you? Right,
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Like it's no, like, definitely ask what your country can
9:50
do for you, because we can cut all sorts of
9:52
taxes and give you all sorts of money. That's a
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real problem.
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Speaker 3: Yeah, who's actually like again, you might not like either
9:59
one of these things.
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Speaker 2: You might like one of them, might like both of them.
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I don't know.
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Speaker 3: Like there's some people who are just you know, kind
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of masochists on all the side of all this stuff.
10:06
Who's the candidate out there is gonna be like I'm
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gonna raise your taxes and cut spending.
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Speaker 4: Yeah, I don't hear from that person.
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Speaker 3: They don't exist right now. And I'm not saying you
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have to get to like some crazy austere place. I'm
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not saying that you have to run surpluses because again,
10:22
I'm not not a surplus dude, man.
10:26
Speaker 4: And that's my question is what changes. It seems to
10:29
me that something has to blow up in your face
10:32
to change that. It seems to me that we actually
10:34
have to send people so security checks that are twenty
10:37
percent lower than the one they got through the month
10:40
before before people finally wake up and like, oh yeah,
10:43
this thing's an actual problem here.
10:45
Speaker 3: What American needs in order for that to happen is
10:48
its own head of lettuce moment. Yeah, just a big
10:50
slap in the face, you know, for those who don't
10:54
understand the head of Lettuce reference. Theresa May comes in
10:57
and says, hey, here's my budget for uh, you know,
11:00
for the UK, and what happened to UK bonds? They
11:04
sold off like one and a half percent in the
11:06
span of a week and that was the end of
11:08
Teresa May. Like it was that government was gone. Yeah again,
11:13
she did not last last longer than the head of Lettuce.
11:16
There's a Twitter account that tracked it had a head
11:19
of Iceberg Lettuce in the Lettuce one was still there
11:22
in Teresa May was not in power anymore.
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Speaker 2: That was her government, right, am I make yeah?
11:27
Speaker 4: I think.
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Speaker 3: Yeah. They've gone through like a bunch over there in
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the last few years. It's kind of hard to keep up.
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Speaker 2: Sometimes.
11:34
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12:00
Speaker 4: I'm finally starting to get some reasonable market data out
12:03
of my children here because, without saying the name here,
12:06
my kids are obsessed with this candy.
12:08
Speaker 3: Oh interesting, yeah, interesting, Mike. You ever been to Dingman's Ferry?
12:14
Speaker 4: I love weird down names. I have not been to
12:17
Dingman's Ferry unless I've accidentally driven through it, but I've
12:20
certainly not stopped in Dingman's.
12:23
Speaker 3: I quote here in Dingman's Ferry, Pennsylvania, less than fifty
12:26
miles from President Joe Biden's hometown of Scranton, where unemployment
12:29
fell to a record low of two point seven percent
12:31
in April.
12:32
Speaker 4: Where did the two point seven percent was that Scranton
12:34
or Dingman's Ferry?
12:35
Speaker 3: Don't know, poorly constructed sentence surgeon, consumer prices unleased by
12:39
the COVID nineteen pandemic or similarly subdued. Weiss Markets Incorporated,
12:44
the chain of two hundred grocers, mostly in the Keystone State.
12:47
Earlier this month sold a choice Porterhouse steak for seven
12:50
to ninety nine a pound to one of its regular customers.
12:52
Speaker 4: Just one.
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Speaker 2: Listen.
12:55
Speaker 3: There's a lot of problems that I have with this piece,
12:57
quite honestly. The first is ding like the way that
13:01
it's talked about here. You're like, oh, that must be
13:03
some like bustling metropolis wherever.
13:07
Speaker 2: To quote from.
13:08
Speaker 3: Wikipedia, Dingwin's Ferry is an unincorporated township unincorporated community in
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Delaware Township, Pike County, Pennsylvania. As of twenty fourteen, it
13:17
had a population of just over one thousand people.
13:19
Speaker 4: How do they even have a grocery store? Fine?
13:22
Speaker 3: Look, everyone's entitled the groceries. I don't want to be
13:25
like take away their grocery.
13:26
Speaker 2: Store, which I know I do.
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Speaker 3: I'm running out, I know is not what you were saying,
13:30
but like, why is some random town of a thousand
13:34
people in Pennsylvania representative of what meat prices should be
13:38
in the country.
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Speaker 4: Let me just ask you. Are you, Chuck and Tucker
13:44
getting used to grocery prices because I'm getting there, especially
13:48
now that I've stopped shopping at Wegman's for like every
13:51
one of my grocery shops.
13:53
Speaker 3: I do all my shopping at DJs now, and I
13:55
will tell you it does a lot to make you
13:57
feel great about prices. I picked up I think it
14:00
was either six or seven pounds of pork chops last
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night eleven Bucks.
14:04
Speaker 4: Yeah, I'm having a lot more shopping going on at
14:08
market Basket, and I'm always happy whenever I leave market Basket.
14:11
And I know that prices are up there too, But
14:14
I'm starting to settle in here. I'm starting to settle
14:18
in here now that there hasn't been an entire shelf
14:20
missing of products that I need. Now that you know
14:24
I've been paying these higher prices for over a year,
14:27
It's not that I love it. It's not that I
14:30
enjoy that most of my groceries are twenty to twenty
14:32
five percent more expensive, but I am starting to get
14:34
used to it.
14:36
Speaker 3: Yeah, I mean again, I've changed my behavior in that
14:39
I'm not shopping at traditional grocery stores for my groceries anymore,
14:43
partly because again, the idea of spending like however much
14:47
it is for a pint of blueberries, only to see
14:49
my one year old eat the whole thing at once,
14:52
I know it is like right in that ballpark, yeah, for.
14:58
Speaker 2: Two of them. So again, like you get more for
15:01
your money.
15:01
Speaker 3: And that's the adjustment that I've made, and I'm not
15:04
going back, because I do find grocery prices still too
15:08
high for the sheer volume of food that I need
15:11
to buy right now.
15:14
Speaker 4: In part again, We've talked about this piece a lot,
15:17
but wage gains have gone up to and according to
15:22
the Bureau of Economic Analysis, which we cite data from frequently,
15:27
spending on food right now makes up less than seven
15:31
and a half percent of consumer spending. That's the lowest
15:34
since before the pandemic in February of twenty twenty. So again,
15:39
I know that sounds strange. It doesn't make you feel
15:43
incredibly great because your total spending buckets still might have increased.
15:47
But again, when you compare food spending right now to
15:51
incomes and to where they've been historically, we're not facing
15:55
a truly outsized overall effect. It's just really uncomfortable because
16:01
you do it every week.
16:02
Speaker 3: And the places where stuff still is uncomfortably moving up
16:06
is in places that is that are still having a
16:08
big impact though, you know, auto insurance rates and home
16:11
insurance rates and stuff like that that can make food
16:15
spending feel a little bit tighter because you're like, oh,
16:17
I've eaten through more of my stuff to get more
16:19
of my paycheck to get here. But yeah, on the
16:22
food prices, i'd say, yes, I'm kind of settled into
16:25
where I am. I did change my behavior about a
16:28
year or so ago, which again also coincided with, hey,
16:31
you have another kid, so maybe that changed more than
16:34
anything else. But I think ultimately we are seeing prices
16:41
stabilized now that they're not going to go down and
16:44
mass because that's just not how it works. Yeah, not usually,
16:49
And everyone who roots for deflation has never lived through
16:51
a deflationary cycle. If you know, anyone who was, you know,
16:53
in their teens in the eighteen nineties, give them a
16:56
call and ask him what it was like during the
16:59
three different banking panics that we had that decade, because
17:03
it was probably bad to quite bad. But again, you're
17:08
gonna have a hard time finding one hundred and forty
17:10
year old to talk to these days.
17:13
Speaker 2: There's just not many of them around it.
17:14
Speaker 4: Yeah, yeah, I would hope that. You know, we've seen
17:19
food prices change people's grocery shopping behavior. Maybe we will
17:23
see auto insurance rates change people's car buying behavior, although
17:27
I kind of doubt it, but that'd be good. Get
17:31
people to stop, you know, spending sixty thousand dollars on
17:33
cars when they make forty thousand dollars a year.
17:35
Speaker 3: And it would be fascinating if the thing that finally
17:37
turns the tide there is people just fed up with
17:39
insurance premiums and they're like, yeah, give me the civic Yeah,
17:42
I'd love that.
17:49
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18:13
Speaker 3: Mike, We've got a piece in the stack today, this
18:16
one from barons to owning a vacation home in a
18:20
hurricane zone is worrisome some owners are selling.
18:24
Speaker 4: As evidence by the fact that home prices in Florida
18:27
are currently heading down.
18:30
Speaker 3: Yeah, and you've got inventory throughout the state now higher
18:33
than it was pre pandemic. And look, I think that
18:37
it's important to recognize a couple of different things here.
18:39
The first is, Hey, there's something happening in the Florida
18:42
insurance market, for the Florida home insurance market that is
18:48
really kind of breaking the real estate market the way
18:51
that it used to operate. You have premiums that in
18:52
a lot of cases are now up anywhere from like
18:55
three hundred to six hundred percent over the last five
18:58
six years.
18:58
Speaker 2: Yeah.
19:00
Speaker 3: The other thing that you do have to remember about Florida,
19:02
there's three things actually not too The other thing you
19:04
have to remember, Hey, back in twenty twenty one and
19:06
twenty twenty two, a ton of people packed up from
19:10
all over the country, in particular the northeast and expensive
19:15
parts of the country, and moved to Florida because they said, Hey,
19:19
I'm working remotely, this is great. And some of those
19:21
trends have kind of reversed now, so you've got that
19:24
reversal that's happening.
19:26
Speaker 2: The third thing to remember is.
19:28
Speaker 3: Like every three years, Florida goes through a mini property
19:30
cycle where they build way too much, a bunch of
19:34
people move, then they keep building. Oh no, now we've
19:36
built too much, a bunch of people like leave, prices
19:39
go down. So it's this hugely cyclical market to begin with.
19:41
And they're in the middle of one of those as well,
19:43
because they built a ton back in twenty two and
19:46
twenty three since they thought a bunch of people were coming,
19:49
and now it's kind of stopped. So it's tough to
19:52
untangle what is they might come back to over and over,
19:56
like what's permanent and what is just a short term glitch.
19:59
Speaker 4: Yeah, and it's tough because real estate as an asset
20:03
class in a lot of ways is so incredibly attractive,
20:07
mainly because the way we fund the purchase. It's not
20:09
anything especially unique about primary residences or vacation homes, easy
20:14
leverage for people, it's just there's no other asset you
20:17
can buy with a thirty year fixed rate loan that
20:21
you only have the option to get cheaper over time.
20:24
Warn Buffets talked about this recently. He's like, there's nothing
20:27
else out there you can say, Okay, yeah, I'm taking
20:29
out a loan. It's going to be paid back over
20:30
thirty years. The rate will never go higher, but if
20:35
it goes lower, then I can lock that in instead.
20:37
There's nothing like it, and so there are still a
20:39
lot of attractive pieces here. But yeah, I think for
20:43
a lot of people, whether it's in Florida or anywhere else,
20:47
the idea of heading into their sixties and seventies and
20:51
even eighties with a couple of different properties to think
20:55
about and worry about is becoming less and less appealing.
20:59
Speaker 3: And so I think with Florida and trying to untangle
21:01
what is going on in that market, it's going to
21:06
take a little bit of time, but it certainly isn't
21:07
going to look good for you know, the next couple
21:10
of years, just because again you look at the listings there.
21:13
But as you know, Mike, it's it's one of those
21:16
questions facing retirees, which is, hey, do I go and
21:22
you know, buy a second place that I use or
21:24
do I uproot my primary residence. And we talk about
21:28
this an awful lot in terms of, Hey, when you're
21:30
building a financial plan, you've got a factor in the
21:34
cost of living. If you're considering moving somewhere, what does
21:37
that cost of living look like? And for a lot
21:39
of people that have moved down to Florida in the
21:41
last five years, the cost of living analysis they might
21:44
have done five years ago is completely outdated with how
21:47
the state has evolved.
21:47
Speaker 1: Now.
21:48
Speaker 4: Yeah, I think there's the relocation argument, which again, you know,
21:52
can still make a lot of sense depending on which
21:54
high tax state you're moving to and which hopefully low
21:57
tax states you're moving to. The you know, the interesting
22:01
piece about that second property to me is that for years,
22:05
financial wise, it has made sense to buy. It has
22:08
been a more compelling offering if you're spending six months
22:11
of a year in a different place to own something
22:13
rather than renting. That's also changing. But where I see
22:17
people run into it frequently is they purely look at
22:19
it as a financial scenario. And that can be good,
22:24
but it doesn't account for unpredicted things like the homeowner's
22:27
insurance market going up by three to six hundred percent.
22:29
It also doesn't account for the quality of life piece,
22:32
and I think people for some reason intentionally avoid this
22:35
when it comes to their own retirement plans. They're super
22:38
focused on the numbers and instead maybe it should be
22:41
focused on Okay, yeah, it is going to be more
22:43
expensive for me to rent a place for three months
22:45
down in Florida in peak season, but is it worth
22:50
it to me?
22:50
Speaker 3: Well, and I'll give you just an example just from
22:53
my own life. My parents, when they were I don't know,
22:57
mid sixties, decided they were going to move to to
23:00
North Carolina and they did that and they had a
23:02
great time down there. When my wife and I started
23:05
having kids, they said, look, we want to be closer
23:07
to you guys. Even though it's more expensive. They did,
23:09
like the opposite of what everyone ever does. They move
23:12
back to the Northeast. They're like, yeah, bring on this,
23:15
and granted, like they still go when they might rent,
23:17
you know, a couple of weeks down in Florida and
23:19
a couple weeks in North Carolina now, so they still
23:22
do those things just to get away. But it's not
23:25
just the financial stuff that you need to focus on
23:27
in retirement, because look, like, yes, you might pay less
23:31
in taxes in Florida, but you might make that up
23:34
spending on you know, trips to go up to see
23:36
the grand kids and stuff. When it's all said and
23:37
done and it's more hassle and as you get older,
23:39
you just don't want to fly as much.
23:41
Speaker 4: Well, if you're facing that type of scenario, got bad
23:44
news for you. Financial advisor can't tell you where you're
23:46
going to be happier in retirement. No, I have no
23:50
ability to measure that one personally. But they can work
23:54
with you to assess the possibility of what you can't
23:57
afford and help you avoid the pitfalls. Because, like Chuck
24:00
just mentioned, it sounds like that wasn't a huge problem
24:03
for his parents. But I have seen it work out
24:05
in a way where, oh, you know, quickly made this decision,
24:09
wasn't happy with it, and then the results of which
24:11
ruined our financial plan because we didn't really understand the
24:15
tax implications, the effect of getting rid of a locked
24:20
in low rate mortgage, all of these different factors that
24:23
go into where you're going to locate yourself in retirement.
24:27
If you have questions about that, maybe you're considering a relocation.
24:29
Maybe you're talking about a second home. Maybe you have
24:32
a second home that you're thinking about selling and trying
24:34
to understand the tax implications to that, the tax implications
24:38
of holding it for the rest of your life and
24:39
renting it versus selling it. All questions that a qualified
24:44
financial planner should help you to assess. If you have
24:47
questions along those lines, you want to talk to one,
24:49
please call the Armstrong Advisory Group at eight hundred three
24:52
nine three four zero zero one. We have offices scattered
24:55
throughout New England where we meet folks in person. We
24:58
also have meetings over the phone via zoom. So really
25:01
happy to meet with anybody anywhere. Again that number for
25:04
the Armstrong Advisory Group, It's eight hundred three nine three
25:08
four zero zero one.
25:10
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
25:13
registered investment advisor. Nothing in the ad or in any
25:15
Armstrong guide a specific financial, legal or tax advice. Consult
25:18
your own financial, tax and to state planning advisors before
25:21
making any investment decisions. Armstrong may contact you to offer
25:24
investment advisory services.
25:26
Speaker 3: Headline from Let's see this is Baron's as well job
25:30
market Strong. So why does it feel so hard to
25:32
find work?
25:32
Speaker 1: Well?
25:33
Speaker 2: Gee, let's start with the first part of that sentence.
25:35
Speaker 3: Maybe the job market isn't actually that strong. There's a
25:39
difference between how low the unemployment rate is and how
25:43
strong the job market is. And we've talked about this
25:46
over the last year, and that look, the unemployment rate
25:49
has actually risen at one point almost one percent from
25:52
its lows. That is not something that you see in
25:56
a ripping job market. In a ripping job market, unemployment
25:59
continues to cone. So anytime that unemployment is rising, even
26:03
if it's at a level that's historically low, it doesn't
26:06
mean that you have a strong job market.
26:08
Speaker 2: You've actually had a weakening one for much of this year.
26:11
Speaker 3: And this piece, you know, details a few people that have,
26:14
you know, sent out hundreds of applications and can't get anywhere.
26:16
And I just I have a ton of sympathy as
26:19
someone who's gone through that once in their life where
26:22
you're just like, it feels like nothing that you can
26:25
do can get anyone to even call you back. And
26:27
I'll tell you it, it sucks. But there's some stats
26:30
in here that I think are really useful too, and
26:32
that before the pandemic, according to Revellio Labs, they I guess.
26:37
Just look at job postings online and pull data from them.
26:41
Over eighty percent of the jobs listed each month were
26:44
filled within six months of the posting. As of April
26:47
of this year, the average job posting only is a
26:50
forty one percent probability of resulting in a new hire
26:52
in the following six months. So it's saying that companies
26:55
have had the postings out there, but they're getting filled
26:58
at half the rate they were pre pandem and that
27:02
could be because of a couple things. It could be, hey,
27:05
companies are more discerning right now. It could be that
27:08
the postings are old and stale and they're not really
27:10
hiring for those positions.
27:11
Speaker 2: Like it could be.
27:12
Speaker 3: Any number of different things. But every metric that we
27:15
have out there shows that the rate of hiring has
27:18
been slowing for the last twelve to eighteen months, and
27:22
that to me, is not indicative of a strong labor market.
27:25
I don't think you say, like, oh, this is like
27:27
a terrible one, because the overall unemployment rate still remains low,
27:31
but you kind of grade it out and you're like, yeah,
27:33
it's kind of the middle.
27:34
Speaker 2: Of the pack.
27:34
Speaker 3: It's not very dynamic in particular, and that's something that
27:37
I think you can say definitively about.
27:39
Speaker 4: Yeah, it's a little bit stale. Employers are holding on
27:44
to their workers but not necessarily expanding teams. What you're
27:47
not dealing with is, you know, they talk about the
27:49
graduate with a master's and quantitative economics from San Francisco
27:53
State Business School, and like he's having a tough time
27:57
finding a job. He's also not competing for those jobs
28:01
with a bunch of laid off you know, master's degrees,
28:04
people who have the same job experience. And so I
28:08
don't think it's the twenty ten job market that we're
28:10
facing right now in terms of that difficulty. The one
28:13
thing I will say that's very different today from Chuck,
28:16
when you and I were applying for jobs, for instance,
28:18
in the wake of the Great Financial Crisis. The ease
28:22
at which you can apply to a job today, and
28:24
therefore the number of applications that go into every single job,
28:28
regardless of the state of the labor market, that's very
28:32
much changed. It's not that those tools didn't really exist,
28:35
but they were still in their infancy back in two
28:37
thousand and nine, ten, twenty eleven, and from what I
28:40
have seen firsthand, every time you open a job here,
28:44
you get hundreds of applications because it is so easy
28:47
to do now, and so standing out is tougher to
28:50
take a.
28:51
Speaker 2: Quick break here. When we come back stack room Let.
28:57
Speaker 1: If you missed any of today's show, catch up whenever
28:59
you want to our YouTube page find daily show segments
29:02
and full shows. Just go to YouTube dot com and
29:05
search for the Financial Exchange. This is your home for
29:08
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29:12
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our page and stay up to date on breaking business
29:19
news all morning long. This is the Financial Exchange Radio Network.
29:33
Speaker 4: Mike, what do you got for stack roulet Ah, winter
29:36
is coming? Felt it this morning when I got out
29:39
of bed, had the oil kick on this morning and
29:43
just taking a look at what that's going to cost
29:46
this year. But before I even get there, have you
29:48
two ever explained you do you het your home with oil?
29:51
Tucker natural gas gas, Chuck gas, Well, I'm still on oil. Okay,
29:56
wellser explaining to somebody not for the Northeast NERD cluster.
30:01
Like you know, I have a bunch of family in
30:03
Arizona who's lived either in California or Arizona. Their whole
30:06
lives and explaining to them how it works around here,
30:10
they get so confused, like what do you mean oil?
30:13
Like where do you get the oil? And so you
30:16
explain to them that a truck comes every few a
30:18
little well in the back of my house, and they're like, well,
30:20
do you have to be there? Was like, now there's
30:21
a little hole that they put all the oil in.
30:24
It just goes directly into And it's so confounding to
30:27
anybody who just has, you know, logical systems of delivering heat,
30:31
like an underground pipe that feeds not gas into their home.
30:34
But that's not how I do it, and how you know,
30:37
millions of New Englanders and Northeasterners do it. But nonetheless,
30:40
home heating oil pretty significantly cheaper than it was this
30:44
time last year. So a few factors obviously go into
30:47
how much it's going to cost to heat your home
30:49
this season, but I think most of them are working
30:52
in favor of a cheaper season one. Obviously, just home
30:57
heating oil prices are down. According to the Saint Louis
30:59
Fan I'm looking at number two heating oil from the
31:02
New York Harbor.
31:04
Speaker 2: What's number one?
31:05
Speaker 4: I don't know this time last year, we were looking
31:08
at three bucks per gallon. Today we're looking at about
31:13
two bucks a gallon, So pretty significant downtick from where
31:17
we were this time last year. It moved down throughout
31:20
the winter last year with a few upticks, But the
31:23
second piece would be every year away from COVID, we
31:26
get there's less time being spent at home. So last winter,
31:30
my wife was still working at home at least seventy
31:34
five percent of the time, heating the home a little
31:37
bit more than we will this winter, and I think
31:38
that's the case for a lot of northeasterners as well.
31:40
So I'm looking forward to a slightly cheaper home heating season.
31:44
Speaker 3: Mike, I know that it's my choice for stack roulette,
31:48
but I'm gonna make me choose. Yes, I'm gonna make
31:50
you choose for me. Just I'm my mental fortitude is
31:53
just gone gone at this point.
31:55
Speaker 2: Do you want to talk about AI solving a meal planning?
31:59
Speaker 4: I had that one too, AI Solving meal Planning?
32:02
Speaker 2: Okay, okay, we got to tuck. We're here, you know,
32:07
we're cool. We're doing it anyways. Uh, it's titled AI
32:10
Solves My most.
32:11
Speaker 3: Annoying chore meal planning for a toddler, and I do
32:15
think this is really interesting, not in that well, look,
32:18
first of all, this.
32:19
Speaker 2: Would never work in my household. For never work.
32:23
Speaker 4: Whose most annoying chor is meal taling for a toddler
32:26
like this? You have to clean puke and poop after
32:29
this thing.
32:31
Speaker 2: Those aren't annoying.
32:33
Speaker 4: I didn't love it. Okay, you have to scrub toilet
32:36
bowls and dust. I'll take the meal planning. I've never dusted.
32:41
Speaker 1: Who dost? Like?
32:43
Speaker 2: What? What? Why would anyone dust?
32:45
Speaker 3: All it does is take the dust and move it
32:47
from the ground where it's not bothering any right?
32:49
Speaker 2: Can we get back into the air?
32:52
Speaker 4: I can't do for it. I find less annoying meal planning.
32:55
Speaker 3: So I do think that the AI meal planning is
32:57
actually kind of interesting in that when I read this,
33:00
I said, okay, like, let me go to chat GPT
33:03
and just build me a meal plan because my wife
33:05
and I we get into a thing that probably most
33:07
families do at some point where it's like, man, it
33:10
feels like we're eating the same thing every week, like
33:12
we could really use something new instead of the same
33:15
old recipes.
33:15
Speaker 2: In my house, No, god, no, what you're doing? New stuff?
33:20
All the time.
33:21
Speaker 3: No, it's the same stuff mac and cheese, and yes, okay, good,
33:28
good good. Anyway, so I said, look, I literally just
33:31
typed in build me a meal planned for dinners for
33:34
the week, and it came up with seven days of them.
33:36
Speaker 2: Look.
33:37
Speaker 3: I might not like all of them, but all I
33:39
need to do is get like two new things in
33:41
a week and then I can figure out the rest
33:42
of it around there. And so it's like, hey, here's
33:46
like a lemon grilled herb chicken. Here is baked salmon
33:50
with sweet potato and a spare I guess, turkey meatballs
33:52
with zoodles and marinerosos.
33:54
Speaker 4: I don't even know what a zoodle is on a
33:55
zucchini noodle.
33:57
Speaker 2: No thanks, I'm not a big zucchini fan.
33:59
Speaker 3: So maybe I could sub regular pasta, but fine, turkey
34:01
meatball sound great. Veggie tacos, shrimp and veggie pie stuff
34:05
bell peppers.
34:06
Speaker 4: So I have two questions about this one. Does everyone
34:09
plan separate meals for their toddlers? Yes?
34:12
Speaker 2: No, yes, yes sucks.
34:15
Speaker 4: We forced them to either you eat what's in front
34:17
of you or you can go find something in the
34:19
pantry on your own.
34:20
Speaker 2: Theaters of all time.
34:22
Speaker 4: But two. I guess my perhaps more important question for
34:27
this program would be who's making money on this? What
34:32
do you mean like this is a useful case for
34:35
artificial intelligence. I'm with you there. Who can monetize this? How?
34:40
How is this going to contribute to Microsoft or Google
34:43
ever making any money?
34:44
Speaker 2: I don't know.
34:45
Speaker 4: Yeah, either, interesting use case for artificially. I might try
34:49
it out, like it seems like an interesting way to
34:51
do things, and like, oh yeah, okay, these kids never
34:54
eat mushrooms, so give me, you know, a meal plan
34:57
for the next week that doesn't include mush rooms in
35:00
any of them and limits this stuff, or you know,
35:04
no heat because my kids won't eat spicy food.
35:06
Speaker 2: I'll tell you what I'm gonna do.
35:07
Speaker 3: Actually, next week, I'm going to I'm gonna ask it specifically,
35:11
gonna be like, look, it's fall, it's getting colder, because honestly,
35:14
I don't want veggie tacos on a thirty degree night
35:17
in November.
35:17
Speaker 4: This is how Chuck Ea eats rocks.
35:19
Speaker 3: Next week, I'm gonna ask chat GPT to build me
35:23
a menu for next week and the week after I'll.
35:26
Speaker 2: Tell you how it went.
35:27
Speaker 4: Looking forward to it, and.
35:30
Speaker 2: I'm excited. I gotta tell you. Let's take a quick break.
35:33
For the rest of the day.
35:34
Speaker 3: Stocks remain broadly up, with the S and p AP
35:37
third of a percent we'll see tomorrow on the Financial
35:40
Exchange