Latest / The Financial Exchange Show / What are some of the lesser known recession indicators showing?

Transcript

What are some of the lesser known recession indicators showing? · The Financial Exchange Show

• 0:00
  Speaker 1: The Financial Exchange is produced by Money Matters Radio and
• 0:02
  Speaker 1: is hosted by employees of the Armstrong Advisory Group, a
• 0:05
  Speaker 1: registered investment advisor. All opinions expressed are solely those of
• 0:08
  Speaker 1: the hosts. Do not reflect the opinions of Armstrong Advisory
• 0:11
  Speaker 1: or anyone else. Investments can lose money. This program does
• 0:14
  Speaker 1: not offer any specific financial or investment advice. Please consult
• 0:17
  Speaker 1: your own financial, tax, and estate planning advisors before making
• 0:20
  Speaker 1: any investment decisions. Armstrong Advisory and the advertisers heard on
• 0:23
  Speaker 1: this program do not endorse each other or their services.
• 0:26
  Speaker 1: Armstrong and Money Matters Radio do not compensate each other
• 0:28
  Speaker 1: for referrals and are not affiliated. This is the Financial
• 0:34
  Speaker 1: Exchange with Chuck Zada and Mike Armstrong, your exclusive look
• 0:39
  Speaker 1: at business and financial news affecting your day, your city,
• 0:42
  Speaker 1: your world. Stay informed and up to date about economic
• 0:46
  Speaker 1: and market trends plus breaking business news every day. The
• 0:50
  Speaker 1: Financial Exchange is a proud partner of the Disabled American
• 0:53
  Speaker 1: Veterans Department of Massachusetts. Help us support our great American
• 0:57
  Speaker 1: heroes by visiting dav five K on Boston and making
• 1:01
  Speaker 1: a donation today. This is the Financial Exchange with Chuck
• 1:05
  Speaker 1: Zada and Mike Armstrong.
• 1:10
  Speaker 2: Good morning, Happy Friday, Welcome back to the Financial Exchange. Sorry, Tucker,
• 1:14
  Speaker 2: I know I came in a little hot there, trying
• 1:16
  Speaker 2: to keep my levels in check. Markets are back in
• 1:19
  Speaker 2: negative territory. They've been flip flopping all morning.
• 1:22
  Speaker 3: Honestly, it's fine. Down half a percent, yeah, fine, close
• 1:27
  Speaker 3: the market like call to day. We're done.
• 1:29
  Speaker 2: So you've got major indices off by about half a percent.
• 1:33
  Speaker 2: You know, anybody that's been following markets this week will
• 1:35
  Speaker 2: take that with a grain of salt because markets have
• 1:37
  Speaker 2: been moving. I mean, did we have a ten percent
• 1:40
  Speaker 2: swing in either direction this week?
• 1:42
  Speaker 3: Mike? Probably the first three days of this week, each
• 1:49
  Speaker 3: day had a seven percent intra day range at minimum.
• 1:54
  Speaker 4: It is nice, Mike.
• 1:56
  Speaker 3: Yesterday we had a five and a half percent rain, right,
• 2:01
  Speaker 3: four and a half.
• 2:02
  Speaker 2: Sorry, So this morning you are not getting much volatility
• 2:05
  Speaker 2: in the stock market. You continue to see quite a
• 2:07
  Speaker 2: bit of volatility, however, in the bond market, with treasury
• 2:11
  Speaker 2: selling off substantially. The yield on the ten year Treasury
• 2:14
  Speaker 2: is now up to four point five eight two twenty,
• 2:17
  Speaker 2: which crossed five, which is a fifth of a percent
• 2:20
  Speaker 2: higher than it was at the close yesterday. So a
• 2:23
  Speaker 2: big move up in yields this morning on sales of
• 2:27
  Speaker 2: treasuries that are coming from who knows precisely where. Could
• 2:30
  Speaker 2: be inflation expectations from the Michigan Sentiment survey, but also
• 2:34
  Speaker 2: could be foreign sellers of US government bonds in retaliation
• 2:37
  Speaker 2: to trade policy that we're.
• 2:39
  Speaker 4: Seeing out of the White House.
• 2:40
  Speaker 3: And by the way, that is now up zero point
• 2:42
  Speaker 3: seventy two percent since the low of last Friday. We
• 2:46
  Speaker 3: got done to three point eight six last Friday four
• 2:49
  Speaker 3: point five eight. The let me see if Mortgage News
• 2:51
  Speaker 3: Daily has done their midday update yet they have not.
• 2:55
  Speaker 3: I didn expect their midday estimate for the their rate
• 2:59
  Speaker 3: survey thirty year fixed rate mortgage was six nine seven yesterday.
• 3:03
  Speaker 3: You're gonna be seven to one to seven two today.
• 3:05
  Speaker 2: Yeah, and again, why, just to explain all this out,
• 3:07
  Speaker 2: what did you say the yield on the thirty year
• 3:08
  Speaker 2: bond was?
• 3:09
  Speaker 3: Uh? The thirty year is four nine four nine eight.
• 3:15
  Speaker 4: Now, okay.
• 3:15
  Speaker 2: So if you are a bank that you're sitting on
• 3:18
  Speaker 2: your customer's deposits right now, you have a couple of options. One,
• 3:21
  Speaker 2: you could go buy that thirty year treasury at four
• 3:24
  Speaker 2: point nine eight percent. Or you could go issue a
• 3:27
  Speaker 2: mortgage to Chuck Tucker or myself and we might pay
• 3:31
  Speaker 2: great credits, we might have fantastic credit worthiness. But I'm
• 3:36
  Speaker 2: not gonna be charging any of us five and a
• 3:39
  Speaker 2: half to six percent here in order to write that mortgage,
• 3:41
  Speaker 2: because it's.
• 3:42
  Speaker 4: A heck of a lot more risk.
• 3:43
  Speaker 3: Right. The big thing is the US government can print
• 3:45
  Speaker 3: its own money in order to pay that mortgage.
• 3:47
  Speaker 4: Chuck, Mike and Tucker cannot.
• 3:49
  Speaker 2: No.
• 3:49
  Speaker 3: I can print my own money. It's just not legal
• 3:50
  Speaker 3: tender for me to do anything with. Yeah, yeah, you know,
• 3:54
  Speaker 3: Stanley Nichols, how many shrewp bucks can you put on
• 3:57
  Speaker 3: the head of a pin? Is the you know, the
• 3:59
  Speaker 3: question that I always like to ask. Let's talk a
• 4:01
  Speaker 3: little bit about what we're seeing from earning season, because
• 4:04
  Speaker 3: with all of the tariff kerfluffel, we do have earnings
• 4:07
  Speaker 3: that kicked off this morning. Big banks, JP, Morgan, Morgan, Stanley, Wells,
• 4:12
  Speaker 3: Fargo Bank, New York, Melon, all of them reporting. I
• 4:16
  Speaker 3: also had Blackrock. Is Blackrock the world's largest asset manager? Now,
• 4:19
  Speaker 3: I do believe, so it's got to be there. Them
• 4:21
  Speaker 3: are Vanguard, right, Yeah, I believe it's black Rock anyways,
• 4:24
  Speaker 3: they reported too, but I number one, the number one correct.
• 4:28
  Speaker 3: Oh that's fun. They wear one of those big foam
• 4:30
  Speaker 3: fingers as Larry Fink have one of those that just
• 4:32
  Speaker 3: says lake not seeing any folk fingers. No, no foam
• 4:35
  Speaker 3: fingers for Larry Fink. So it's not Larry foam fingers.
• 4:39
  Speaker 5: Don't believe it is, okay.
• 4:41
  Speaker 3: JP Morgan reported earnings this morning and had a perfectly
• 4:45
  Speaker 3: fine quarter, in fact, pretty solid with especially trading revenue. Yeah, good, court,
• 4:49
  Speaker 3: I mean you would expect trading revenue to be good,
• 4:50
  Speaker 3: and you know, even Q one, we were seeing some stuff.
• 4:53
  Speaker 3: In March four, fourteen point six to four billion dollar
• 4:57
  Speaker 3: profit and revenue rose eight percent to forty five point
• 5:01
  Speaker 3: three to one billion. Jamie Diamond pretty much said yeah,
• 5:04
  Speaker 3: like things were cranking along pretty well. He did have
• 5:07
  Speaker 3: some comments though about the broader economy that I think
• 5:11
  Speaker 3: are notable here, and I'm going to quote from him
• 5:16
  Speaker 3: just because it's worth it. What I would say is
• 5:20
  Speaker 3: our he was asked about the state of the economy.
• 5:23
  Speaker 3: He said, what I would say is our excellent economist
• 5:25
  Speaker 3: Michael Faroli. I called him this morning specifically to ask
• 5:28
  Speaker 3: him how they're looking at their forecast today. They think
• 5:30
  Speaker 3: it's about fifty to fifty for a recession, so I'll
• 5:32
  Speaker 3: just refer to that. And obviously if there's a recession,
• 5:34
  Speaker 3: credit losses will go up and other factors will change too.
• 5:37
  Speaker 3: So pretty much saying yeah, things could get worse for
• 5:39
  Speaker 3: us if there's a recession. I think you're gonna see
• 5:42
  Speaker 3: a lot of companies you guys, not you, but the
• 5:44
  Speaker 3: analyst community has already reduced its earnings estimates for the
• 5:47
  Speaker 3: S and P by five percent, So now it's up
• 5:50
  Speaker 3: five as opposed up ten. My guess is that will
• 5:53
  Speaker 3: be zero and negative five probably by the next month.
• 5:56
  Speaker 3: And then you're gonna hear a thousand companies report. They're
• 5:58
  Speaker 3: gonna tell you what their guidance is. My guesses a
• 6:00
  Speaker 3: lot will remove it. Jamie, Thanks, so you listen to
• 6:03
  Speaker 3: our show. We said this a few days ago. The
• 6:05
  Speaker 3: companies are gonna start pulling guidance probably. I appreciate that,
• 6:09
  Speaker 3: and a couple other quotes that I think you're interesting
• 6:12
  Speaker 3: in here. Anecdotally, a lot of people are not doing
• 6:15
  Speaker 3: things because of this. They're gonna wait and see that's
• 6:18
  Speaker 3: m and A m and A with middle market companies.
• 6:20
  Speaker 3: People's hiring plans with stuff like that, so people have
• 6:22
  Speaker 3: to adjust to the new environment. So diamond saying yeah,
• 6:25
  Speaker 3: things were good in Q one, he actually said that, look,
• 6:29
  Speaker 3: they start to see a little bit of an uptick
• 6:30
  Speaker 3: and consumer spending on credit cards as people try to
• 6:33
  Speaker 3: get ahead of any potential tariffs. But that for you know,
• 6:36
  Speaker 3: the stuff that really drives the economy. He's expecting there
• 6:40
  Speaker 3: to be a slowdown, is what he's guiding.
• 6:43
  Speaker 2: They also set aside nine hundred and seventy three million
• 6:45
  Speaker 2: dollars for future excuse me, loan losses.
• 6:48
  Speaker 3: Not a huge chunk of change.
• 6:49
  Speaker 2: No, I don't recall how much they were setting aside
• 6:52
  Speaker 2: in the early days of COVID. I don't think it's
• 6:54
  Speaker 2: quite up to nearly those levels. But they did set
• 6:57
  Speaker 2: aside some money for future loan losses. But I think
• 7:02
  Speaker 2: we're heading into earning season, which would normally be all
• 7:05
  Speaker 2: that we are talking about right now. Obviously, there's been
• 7:07
  Speaker 2: a few other things on the docket this last week
• 7:10
  Speaker 2: or so, and there will continue to be. I think
• 7:13
  Speaker 2: what you have to expect here when it comes to
• 7:15
  Speaker 2: earnings is massive potential swings and massive volatility related to
• 7:20
  Speaker 2: those earnings because there's gonna be some weird statements. This Monday,
• 7:25
  Speaker 2: for example, probably the worst possible time to report your earnings.
• 7:29
  Speaker 4: Levi's reported results.
• 7:31
  Speaker 2: And like four days ago your second Yeah, they reported
• 7:34
  Speaker 2: their results, and again nothing to do with banking.
• 7:38
  Speaker 4: They had a fairly good quarter.
• 7:42
  Speaker 2: They've got supply chain stretching from China to Mexico, though,
• 7:45
  Speaker 2: and they delivered a solid earnings report. But as analysts
• 7:49
  Speaker 2: and investors this is a quote from I think.
• 7:51
  Speaker 4: Bloomberg here, yes, Bloomberg.
• 7:54
  Speaker 2: As analysts and investors digested the company's forecast, which ignored
• 7:58
  Speaker 2: the potential impact of recent tariff, it shares plunged eight
• 8:01
  Speaker 2: percent Tuesday, Then they soared Wednesday, driven higher by the
• 8:04
  Speaker 2: broader rebound, and dropped again Thursday, leaving them down sixteen
• 8:07
  Speaker 2: percent for the year. Investors are not going to really
• 8:11
  Speaker 2: know what to do with these earnings forecasts, and I
• 8:14
  Speaker 2: think a lot of the forecasts aren't going to be there.
• 8:16
  Speaker 2: In general, I think a lot of companies are probably
• 8:18
  Speaker 2: just gonna come out and say it, we don't know
• 8:20
  Speaker 2: how much we're gonna make this year. Yeah, And that's
• 8:22
  Speaker 2: gonna leave a lot of people kind of in the
• 8:25
  Speaker 2: wind in terms of how you value those companies.
• 8:28
  Speaker 3: Right, it's a question of Okay, you take your previous guidance,
• 8:33
  Speaker 3: now you got to kind of add like a big
• 8:34
  Speaker 3: cone around it as far as you know the directions
• 8:37
  Speaker 3: that it could go. Because look for some companies, they
• 8:40
  Speaker 3: may find dislocations that help them with profits in isolated areas. Sure,
• 8:44
  Speaker 3: I'm not saying that that's going to be like the
• 8:45
  Speaker 3: case everywhere, but hey, if you're a company that has
• 8:48
  Speaker 3: been sourcing all of your product from the United States
• 8:52
  Speaker 3: in Brazil, okay, you might be in like a fine
• 8:56
  Speaker 3: situation where you're not overly disrupted, and in maybe you
• 8:59
  Speaker 3: capital because you pick up more market share and so
• 9:02
  Speaker 3: your earnings go up like that. There are gonna be
• 9:04
  Speaker 3: companies that do benefit out of this. There're gonna be
• 9:08
  Speaker 3: other ones like five below where we covered where they
• 9:10
  Speaker 3: import the vast majority of their product from China. I
• 9:15
  Speaker 3: have no idea what even do with that, because I
• 9:17
  Speaker 3: don't know what their inventory is gonna be. I don't
• 9:19
  Speaker 3: know what their sales are gonna I don't know any
• 9:21
  Speaker 3: of that. So you're you're gonna see some funky things.
• 9:25
  Speaker 3: And again, there there are going to be some companies
• 9:28
  Speaker 3: that end up doing just fine out of this, like
• 9:31
  Speaker 3: it's it's it's going to be a very strange couple
• 9:36
  Speaker 3: of quarters as we try to navigate what it looks like.
• 9:39
  Speaker 3: But it's not gonna be everyone you know, you know
• 9:42
  Speaker 3: has you know these huge down you know, downward shifts
• 9:45
  Speaker 3: in revenue and and this and that, Like there are
• 9:47
  Speaker 3: gonna be some winners out of this too, Like it's
• 9:49
  Speaker 3: it's not all one direction there. Let's take a quick
• 9:53
  Speaker 3: break here. When we come back, let's do a little
• 9:57
  Speaker 3: bit of trivia right after this.
• 10:00
  Speaker 1: Tara Fever's in high gear. We've got the latest on
• 10:04
  Speaker 1: what might be next and how long it might last.
• 10:06
  Speaker 3: Only here on.
• 10:07
  Speaker 1: The Financial Exchange Radio Network. The Financial Exchange streams live
• 10:12
  Speaker 1: on YouTube. Like our page and stay up to date
• 10:15
  Speaker 1: on breaking business news all morning long. This is the
• 10:18
  Speaker 1: Financial Exchange Radio Network.
• 10:25
  Speaker 5: Tam for trivia here on the Financial Exchange and on
• 10:27
  Speaker 5: this day. Back in nineteen sixty one, Bob Dylan made
• 10:30
  Speaker 5: his first appearance at Folk City, Greenwich Village, New York City.
• 10:34
  Speaker 5: Folk City was one of the most influential music venues
• 10:37
  Speaker 5: in the country until it closed in the late eighties.
• 10:41
  Speaker 5: Trivia question today, who played Bob Dylan in the twenty
• 10:44
  Speaker 5: twenty four biopic A Complete Unknown? Once again? Who played
• 10:49
  Speaker 5: Bob Dylan the twenty twenty four biopick A Complete Unknown?
• 10:53
  Speaker 5: Be the fifth person today to Texas at six one
• 10:56
  Speaker 5: seven three six two thirteen eighty five with the correct answer,
• 11:00
  Speaker 5: and you get a brand new Financial Exchange Show T
• 11:02
  Speaker 5: shirt once again. The fifth correct response to text us
• 11:05
  Speaker 5: at six one seven three six two thirteen eighty five,
• 11:08
  Speaker 5: we'll get that T shirt. See complete contest rules at
• 11:11
  Speaker 5: Financial Exchange Show dot com.
• 11:13
  Speaker 2: By the way, we've been doing this all week, but
• 11:14
  Speaker 2: you can also text that number. If you have questions
• 11:17
  Speaker 2: for Tucker just Chucker myself.
• 11:22
  Speaker 3: If you've got questions about what's going on, text the
• 11:24
  Speaker 3: show at six one seven three six two thirteen eighty five.
• 11:26
  Speaker 2: And if you want to know how Tucker makes such
• 11:28
  Speaker 2: delicious beef jerky at home, then you can also text
• 11:31
  Speaker 2: the show and he'll.
• 11:31
  Speaker 4: Be sure to share the recipe.
• 11:33
  Speaker 3: It is outstanding, Okay, go first time doing it, it's outstanding.
• 11:36
  Speaker 3: I gotta say, like, just fantastic. It's and it's only
• 11:38
  Speaker 3: going to get better from here first time.
• 11:40
  Speaker 5: Right, yeah, yeah, I don't know if how we'll get better.
• 11:43
  Speaker 5: It's just you know, it's the same recipe.
• 11:44
  Speaker 3: So you're saying that your first time is your best time.
• 11:46
  Speaker 5: No, no, no, I've I've boughted plenty of barbecue stuff
• 11:50
  Speaker 5: peaked in his thirties.
• 11:53
  Speaker 3: Sounds about right, don't we all? Anyways, Uh, let's talk
• 11:57
  Speaker 3: about this piece from Bloomberg, the Beauty Salon recession indicator.
• 12:01
  Speaker 2: I like weird recession indicators, and I think there's probably
• 12:05
  Speaker 2: the underpants one. The underpants one is a great one,
• 12:08
  Speaker 2: and this is an interesting one. So if you've ever
• 12:11
  Speaker 2: been to the Javit Center in New York City, I haven't.
• 12:14
  Speaker 2: It's a giant convention center. It's where they host for instance,
• 12:19
  Speaker 2: you know, if you run the New York City Marathon,
• 12:21
  Speaker 2: you go pick up your bib there. But ye have
• 12:23
  Speaker 2: plenty of giant conventions, and this week they happen to
• 12:27
  Speaker 2: be having the event of all events for the beauty industry.
• 12:32
  Speaker 2: There are more than thirty two thousand spa technicians, hairstylists,
• 12:36
  Speaker 2: coloriss and makeup artist descending on New York from across
• 12:40
  Speaker 2: the country.
• 12:41
  Speaker 3: It's for the International Esthetics, Cosmetics and Spa Conference.
• 12:44
  Speaker 2: And generally speaking, I don't think this is something that
• 12:46
  Speaker 2: Bloomberg usually covers.
• 12:49
  Speaker 3: No, Usually it's got me wrong. It's like ces from
• 12:51
  Speaker 3: Vegas the first week of the year.
• 12:52
  Speaker 2: Yeah, but they did this time send a bunch of
• 12:55
  Speaker 2: reporters down it.
• 12:56
  Speaker 4: And why they did so.
• 12:57
  Speaker 2: Is because they were interested to hear like, Okay, if
• 13:01
  Speaker 2: you're getting your what's a cosmetic, if you're getting your
• 13:04
  Speaker 2: botox injection, if you're getting your blowout, if you're getting
• 13:08
  Speaker 2: I don't know what, you're manicure.
• 13:10
  Speaker 4: Yeah, I'm nailing it with these these beauty trips.
• 13:13
  Speaker 3: You nailing it?
• 13:16
  Speaker 4: Yeah, thank you.
• 13:17
  Speaker 2: Then those are, by default, for most people, a pretty
• 13:21
  Speaker 2: discretionary item.
• 13:22
  Speaker 4: It's not something you.
• 13:23
  Speaker 2: Necessarily need on your regular schedule. And so they were curious,
• 13:27
  Speaker 2: are they seeing any pullbacks? They went and talked to
• 13:30
  Speaker 2: dozens of different people across the country. There and generally
• 13:35
  Speaker 2: speaking across the board, the people that do this for work,
• 13:41
  Speaker 2: we're saying, yeah, our regular customers are stretching things a
• 13:44
  Speaker 2: little bit, they're skipping their regular appointment. They are not
• 13:48
  Speaker 2: seeing the same volume of customers that they were even
• 13:51
  Speaker 2: just a few months ago. I think it speaks to
• 13:55
  Speaker 2: and lines up with everything else we've been hearing. But
• 13:57
  Speaker 2: I guess I like to cover it because I'm hoping
• 13:59
  Speaker 2: that they're somebody else listening that can kind of text
• 14:02
  Speaker 2: us in if they're seeing this type of thing or
• 14:04
  Speaker 2: something different in their own line of work. Maybe you
• 14:07
  Speaker 2: operate a barbershop, maybe you operate a home construction business.
• 14:11
  Speaker 2: Are you seeing any of this stuff that we're talking
• 14:13
  Speaker 2: about playing out in your personal world? Six one, seven, three, six,
• 14:17
  Speaker 2: two thirteen eighty five again is that text number. But
• 14:21
  Speaker 2: I find these types of stories to be really fascinating because, yeah,
• 14:25
  Speaker 2: industries like this oftentimes get a very early sense of
• 14:29
  Speaker 2: what's happening in the consumer spending world.
• 14:31
  Speaker 3: This is another place.
• 14:32
  Speaker 2: Just again like probably everything that you get supplies from
• 14:36
  Speaker 2: is from China.
• 14:36
  Speaker 3: This right, Like how do you even know what your
• 14:40
  Speaker 3: inventory is going to look?
• 14:41
  Speaker 6: Like?
• 14:41
  Speaker 3: How do you price it? I mean, it's just you
• 14:44
  Speaker 3: wouldn't think you'd have to be, you know, a supply
• 14:47
  Speaker 3: chain engineer to work in that business, but like now
• 14:51
  Speaker 3: you kind of have to figure out how you're gonna
• 14:53
  Speaker 3: do it because I don't look I'm the least qualified
• 14:57
  Speaker 3: person to talk about this. I have no hair, and
• 14:59
  Speaker 3: I can my beard nice and beefy, so like I'm
• 15:03
  Speaker 3: not one for you know, a whole bunch of personal
• 15:07
  Speaker 3: care appointments and products and things like that. But I
• 15:11
  Speaker 3: can tell you, like from what I do know, the
• 15:14
  Speaker 3: people that you know do spend money in these areas,
• 15:18
  Speaker 3: they typically are looking for like the same products on
• 15:20
  Speaker 3: a repeated basis, Like they don't want to be switching
• 15:23
  Speaker 3: and changing all the time. So I don't know how
• 15:25
  Speaker 3: this is gonna work from just a sourcing perspective when
• 15:29
  Speaker 3: you talk about you know, barbers and stylists and estheticians, like,
• 15:35
  Speaker 3: I don't know what it looks like.
• 15:37
  Speaker 2: Yeah, yeah, it's it's an interesting read if you get
• 15:40
  Speaker 2: a chance to check it out. It's Uh, they really
• 15:42
  Speaker 2: do get people from a number of different backgrounds in
• 15:45
  Speaker 2: areas and pretty universally. The answer is yeah, people are
• 15:48
  Speaker 2: people are stretching the dollar, they're not tipping as much,
• 15:51
  Speaker 2: and they are generally pulling back on frequency of these
• 15:54
  Speaker 2: types of appointments.
• 15:55
  Speaker 3: So again, just I think like the underwear Index, which
• 15:59
  Speaker 3: we found out that Warren Buffet they own fruit of.
• 16:01
  Speaker 2: The loom, right, I do own fruit of the looms,
• 16:03
  Speaker 2: so we probably don't get much of it. The underwear
• 16:05
  Speaker 2: Index is another famous one out there. If you missed
• 16:08
  Speaker 2: that show that we did famously, Warren Buffett like to
• 16:12
  Speaker 2: look at it, but you just take a look at
• 16:15
  Speaker 2: sales of underwear companies, because I know it was on Greenspan,
• 16:18
  Speaker 2: like green Span, Green Starry.
• 16:20
  Speaker 4: My apologies.
• 16:21
  Speaker 2: He liked to look at that because it was a
• 16:23
  Speaker 2: pretty good indication of Hey, you know, if if men
• 16:26
  Speaker 2: in particular are worried about the economic situation, it's one
• 16:29
  Speaker 2: of the first things they'll cut out of their budget.
• 16:31
  Speaker 2: They'll just wear boxers with holes in them until until
• 16:34
  Speaker 2: their income situation improves.
• 16:37
  Speaker 3: There's a few, So I just pulled up the Wikipedia
• 16:39
  Speaker 3: page for the men's underwear index and they have you know,
• 16:43
  Speaker 3: the sea also, like, okay, what else is out there?
• 16:45
  Speaker 3: There's also the hemline index. What's that? It's a theory
• 16:50
  Speaker 3: that suggests that skirt lengths rise or fall along with
• 16:53
  Speaker 3: stock prices. Oh, I've heard it's more like correlation than
• 16:58
  Speaker 3: anything else. But it's kind of like how you know
• 17:00
  Speaker 3: the interest rate chart that shows the fed fed chair heights.
• 17:04
  Speaker 3: But the most common version is that skirt lens gets
• 17:06
  Speaker 3: shorter in good economic times and longer in bad ones.
• 17:09
  Speaker 4: Interesting.
• 17:10
  Speaker 3: The reverse has also been proposed, with longer skirts singaling prosperity,
• 17:14
  Speaker 3: like the nineteen fifties. It's most commonly attributed to economist
• 17:17
  Speaker 3: George Taylor in nineteen twenty six.
• 17:19
  Speaker 4: I'm not sure I'm buying that one.
• 17:21
  Speaker 3: So there's that, but I've never worn a skirt. There's
• 17:24
  Speaker 3: also let's see the lipstick index, similar increased sales of cosmetics.
• 17:30
  Speaker 3: You know, Oh, no, this is interesting actually, oh first indicator.
• 17:34
  Speaker 2: Yes, lipstick is a cheaper item that people can buy
• 17:37
  Speaker 2: and still feel good about it, Yes, and not blow
• 17:40
  Speaker 2: the budget out.
• 17:41
  Speaker 3: Yes, it's kind of a contraindicator. As lipstick sales go up,
• 17:44
  Speaker 3: you start to see a bad economy developing. Interesting.
• 17:48
  Speaker 2: Yeah, I hadn't heard that one before. Sorry, I forgot
• 17:50
  Speaker 2: about it. These are just so unique and compelling and
• 17:54
  Speaker 2: interesting that I just they're so different from what we
• 17:57
  Speaker 2: usually talk about that they're pretty intriguing. If you have
• 18:00
  Speaker 2: of your own cool recession indicator, we want to hear
• 18:03
  Speaker 2: about it on the show.
• 18:04
  Speaker 3: Is there anything like when when things slowed down like
• 18:06
  Speaker 3: that that you know, you're like, okay, buy less of that,
• 18:09
  Speaker 3: or I buy more of that.
• 18:11
  Speaker 2: It's the more common things. Uh, I dine out less frequently. See,
• 18:18
  Speaker 2: I do change where I do my grocery shopping when
• 18:21
  Speaker 2: the economy is bad, right, you know, if I was
• 18:24
  Speaker 2: oftentimes going to Whole Foods, I'm going to attempt to
• 18:27
  Speaker 2: go to Market Basket on my way home instead, even
• 18:30
  Speaker 2: though it's you know, way further out of the way.
• 18:33
  Speaker 2: So those types of behavioral changes. I can't think of
• 18:35
  Speaker 2: anything I buy more of when the economy is garbage.
• 18:41
  Speaker 3: Alcohol, cigarettes.
• 18:44
  Speaker 4: I never smoked cigarettes. Maybe I'll caohol.
• 18:47
  Speaker 3: I forget which day it was in the last week,
• 18:49
  Speaker 3: but there was one day where there were like five
• 18:51
  Speaker 3: or six stocks that were up for the day, and
• 18:53
  Speaker 3: two of them were Philip Morrison Netflix. It was like, okay,
• 18:56
  Speaker 3: so we're gonna get through this by by smoking and
• 18:58
  Speaker 3: watching Netflix. That's that's what the market.
• 19:00
  Speaker 4: Was telling us, binging two different types of products.
• 19:03
  Speaker 3: I'm taking a look at markets right now, relatively calm day,
• 19:07
  Speaker 3: not much going on. Actually, the Dow was off two
• 19:09
  Speaker 3: hundred and seventeen points, the S Andp's down twenty, the
• 19:11
  Speaker 3: Nasdaq down fifty two. So maybe you're starting to get
• 19:15
  Speaker 3: a sense of volatility coming in a little bit. But
• 19:18
  Speaker 3: that's just in the equity markets. Bonds, tenure treasury off
• 19:22
  Speaker 3: zero point one five percent up to four point five
• 19:24
  Speaker 3: five oil up twenty cents a barrel to sixty dollars
• 19:27
  Speaker 3: twenty seven cents right now, quick break. We got the
• 19:30
  Speaker 3: trivia answer after this.
• 19:41
  Speaker 1: Bringing the latest financial news straight to your radio. Every day,
• 19:46
  Speaker 1: it's the Financial Exchange on the Financial Exchange Radio Network.
• 19:51
  Speaker 1: The Financial Exchange Show podcast drops every day on Apple,
• 19:55
  Speaker 1: Spotify and iHeartRadio. Hit that subscribe button and leave us
• 19:59
  Speaker 1: a five star ro you you're listening to the Financial
• 20:02
  Speaker 1: Exchange Radio Network.
• 20:07
  Speaker 5: Tri Your question today, who played Bob Dylan in the
• 20:10
  Speaker 5: twenty twenty four bio Pick a complete unknown. That would
• 20:14
  Speaker 5: be Timothy Chalo may Winter. Today of the Financial Look,
• 20:18
  Speaker 5: Shane showed t shores Maureen from Daville, Connecticut. Congrats to Maureen,
• 20:22
  Speaker 5: and we played trivia every day here on the Financial
• 20:24
  Speaker 5: e Change. See complete contest rules at Financial Lookshane Show
• 20:28
  Speaker 5: dot com.
• 20:29
  Speaker 3: He's been in uh quite a bit recently, hasn't he.
• 20:32
  Speaker 3: Yeah he's a star. Yep, yeah, he's Uh. I gotta
• 20:36
  Speaker 3: say so. Do you guys know the first movie that
• 20:38
  Speaker 3: he was in?
• 20:39
  Speaker 4: Yes?
• 20:39
  Speaker 5: I think, uh, Interstellar right correct.
• 20:42
  Speaker 3: Yeah.
• 20:42
  Speaker 5: I realized had like my eighth viewing of that movie,
• 20:45
  Speaker 5: I was like, oh, that's Timothy shallowy.
• 20:47
  Speaker 3: Yeah, yeah, yeah, son, yeah, like the youngest version of
• 20:51
  Speaker 3: the Sun got Yeah, I gotta say the uh I did.
• 20:57
  Speaker 3: I watched the second part of Doune Dune part two
• 20:59
  Speaker 3: if you haven't seen it, and first of all, much
• 21:01
  Speaker 3: much more engaging than the first, which I thought was like,
• 21:05
  Speaker 3: visually great but just kind of, you know, a little slow.
• 21:08
  Speaker 3: The second one's fantastic. Check it out. It cooks.
• 21:12
  Speaker 4: Just getting into reviews of two year old movies.
• 21:15
  Speaker 3: Now, I just watched two year old. Actually it came
• 21:17
  Speaker 3: out last year, so thank you for playing. Uh you
• 21:20
  Speaker 3: watch what Tombstone? Oh tell me what happens? It's only
• 21:24
  Speaker 3: thirty years old. Watch have you seen Top Gun? Which
• 21:30
  Speaker 3: one exactly. Let's talk a little bit about the spring
• 21:34
  Speaker 3: housing market. So Peace and Wall Street Journal stubbornly high
• 21:37
  Speaker 3: mortgage rates thwart critical home selling season, So yeah, this
• 21:41
  Speaker 3: is going to be the story along with Look, all
• 21:44
  Speaker 3: these costs are up, mortgage rates, property taxes, insurance. It's
• 21:49
  Speaker 3: going to be a tough spring housing season given where
• 21:52
  Speaker 3: the cost structure is. Mike Simonson, who we chat with occasionally,
• 21:56
  Speaker 3: is from Housing Wire. Uh he's dated at the beginning
• 21:59
  Speaker 3: of this week. Here's here's where we stand. And again
• 22:00
  Speaker 3: this is all backwards looking, but it's informative about you
• 22:03
  Speaker 3: know what may come. So for pretty much the first
• 22:07
  Speaker 3: three months of the year, you were running pending home
• 22:10
  Speaker 3: sales a little bit below twenty twenty four levels, but
• 22:14
  Speaker 3: new listings were growing more rapidly. So we get to
• 22:17
  Speaker 3: the point now where existing inventory, and this is as
• 22:20
  Speaker 3: of the beginning of this week, was at six hundred
• 22:22
  Speaker 3: and ninety one thousand units nationwide for single family homes.
• 22:25
  Speaker 4: Okay, that is up.
• 22:27
  Speaker 3: Almost thirty five percent year over year and now is
• 22:31
  Speaker 3: only about fifteen percent below twenty seventeen through twenty nineteen levels.
• 22:37
  Speaker 2: Yeah, I was gonna say I'm not looking at single
• 22:39
  Speaker 2: family listings, but according to the Saint Louis Fed, of
• 22:42
  Speaker 2: all active listings they're about they're exactly eighty percent of
• 22:47
  Speaker 2: March twenty nineteen listings, So you know we're getting there.
• 22:52
  Speaker 3: What you are seeing though, because of more listings and
• 22:54
  Speaker 3: people not being able to afford them, price cuts are
• 22:58
  Speaker 3: at a decade high for this time of year. Right now,
• 23:02
  Speaker 3: thirty five percent of single family listings, according to Mike Simonson,
• 23:06
  Speaker 3: have a price cut on them. The norm for this
• 23:09
  Speaker 3: time of year is around twenty five to twenty seven percent.
• 23:13
  Speaker 2: So let's talk about where that's a thing and where
• 23:15
  Speaker 2: it's probably not so. Wait, in Arizona. I'm looking at
• 23:18
  Speaker 2: this data. Housing inventory in Arizona is one hundred and
• 23:21
  Speaker 2: five percent of March twenty nineteen levels, Florida is one
• 23:25
  Speaker 2: hundred and sixteen percent, and Texas is one hundred and
• 23:28
  Speaker 2: twenty one percent of March twenty nineteen levels. You got
• 23:31
  Speaker 2: a lot of homes for sale there. I think there
• 23:33
  Speaker 2: are probably some housing cuts coming in Massachusetts. Half in Connecticut.
• 23:39
  Speaker 2: I continue to laugh because I just don't understand what's
• 23:42
  Speaker 2: happened today.
• 23:42
  Speaker 3: That's going on there.
• 23:44
  Speaker 2: I think what it was is so many New Yorkers
• 23:47
  Speaker 2: moved out and moved to Connecticut.
• 23:49
  Speaker 4: But I I could be wrong. I don't know sure.
• 23:52
  Speaker 2: There are twenty three percent of the homes that were
• 23:56
  Speaker 2: for sale in twenty nineteen are That's the volume of
• 23:59
  Speaker 2: homes that are for see right now, and so it's.
• 24:01
  Speaker 3: A quarter of normal inventory, quarter of normal inventory. Probably
• 24:04
  Speaker 3: not many past cuts coming there.
• 24:05
  Speaker 2: There are other places too, Like I hadn't looked at Illinois,
• 24:07
  Speaker 2: but I was curious. You know, Midwest's biggest probably population
• 24:11
  Speaker 2: state in the Midwest. A third of the homes that
• 24:14
  Speaker 2: were for sale and a normal market are for sale
• 24:16
  Speaker 2: right now in Illinois.
• 24:17
  Speaker 3: And so this gets it. Okay, if if you are
• 24:20
  Speaker 3: considering a move right now, which again I know, with
• 24:23
  Speaker 3: all of the uncertainty about you know, tariffs and this
• 24:26
  Speaker 3: and that, you may be saying, okay, let me put
• 24:27
  Speaker 3: that on the back burner, leave Connecticut and go to Texas. Well,
• 24:29
  Speaker 3: here's what Mike Simons is saying. So there are actually
• 24:32
  Speaker 3: eight states right now that have statewide home price declines
• 24:35
  Speaker 3: in place compared to last year. Texas, Florida, Georgia, South Carolina, Arizona, Iowa,
• 24:45
  Speaker 3: South Dakota, and Washington State. He says. The next two
• 24:48
  Speaker 3: that are probably up are Colorado and Tennessee. Okay, so
• 24:53
  Speaker 3: it is something where in theory, and again this is theory. Okay,
• 24:59
  Speaker 3: if you can find find a buyer for a place
• 25:02
  Speaker 3: in the Northeast that you are trying to sell and
• 25:04
  Speaker 3: you are looking to move south and or west southwest,
• 25:08
  Speaker 3: if you will, you have the possibility to find some
• 25:14
  Speaker 3: deals because you have some bargaining power. In both cases,
• 25:16
  Speaker 3: it's a seller's market still in the Northeast in many areas,
• 25:20
  Speaker 3: not everywhere. I mean, obviously the more rural you get, like,
• 25:23
  Speaker 3: those have been challenging places for a while now. But
• 25:27
  Speaker 3: if you are trying to buy into, you know, markets
• 25:30
  Speaker 3: in Florida and Texas, you can have some some opportunities
• 25:33
  Speaker 3: that pop up. The piece to be aware of, though,
• 25:37
  Speaker 3: is the insurance and property tax side of things. I
• 25:40
  Speaker 3: have a buddy of mine who I was talking to
• 25:43
  Speaker 3: just about like housing costs and everything. He lives in Texas.
• 25:47
  Speaker 3: He's like, I've gotten hit by a twenty five hundred
• 25:49
  Speaker 3: dollars property tax increase each of the last two years.
• 25:52
  Speaker 3: My property tax is just tripled, basically, is what he
• 25:54
  Speaker 3: told me. I'm like, oh, like, that doesn't sound fun.
• 25:58
  Speaker 3: I know people in Florida that have had their insurance
• 26:00
  Speaker 3: costs quadruple in the last four or five years. It's
• 26:04
  Speaker 3: it's messy everywhere. So remember if if you are in
• 26:08
  Speaker 3: the market for a new home, those secondary cost of
• 26:12
  Speaker 3: insurance and taxes are likely a bigger proportion of your
• 26:16
  Speaker 3: budget than they used to be, and you need to
• 26:18
  Speaker 3: factor that in. It can't just be the home price.
• 26:21
  Speaker 3: Those other pieces are getting to be a bigger chunk.
• 26:24
  Speaker 5: Consistently voted one of the top Caribbean destinations. The United
• 26:28
  Speaker 5: States Virgin Islands is the perfect place for your next vacation.
• 26:31
  Speaker 5: Whether you're looking for a romantic getaway, a long weekend
• 26:35
  Speaker 5: with friends, or family vacation, Saint Croix, Saint Thomas, and
• 26:38
  Speaker 5: Saint John have everything you need to enjoy that special
• 26:42
  Speaker 5: time away from home.
• 26:44
  Speaker 3: Take advantage of.
• 26:45
  Speaker 5: A variety of incredible promotions that are available right now.
• 26:49
  Speaker 5: Go to visit USVII dot com slash promotions, where you'll
• 26:54
  Speaker 5: find details about all of these amazing experiences, including a
• 26:58
  Speaker 5: stay at the Divvy Karina all inclusive beach resort and
• 27:02
  Speaker 5: casino on San Croix. From the moment you arrive, you'll
• 27:06
  Speaker 5: fall naturally in rhythm with the heartbeat of the islands.
• 27:09
  Speaker 5: There's no money to exchange, and travel from New England
• 27:12
  Speaker 5: could not be easier. Don't miss your chance to enjoy
• 27:15
  Speaker 5: America's Caribbean paradise the United States Virgin Islands. Had to
• 27:19
  Speaker 5: visit USVII dot com slash promotions for more information and
• 27:24
  Speaker 5: to book your trip today. That's a visit USVII dot
• 27:27
  Speaker 5: com slash promotions.
• 27:30
  Speaker 2: Speaking of that cost comparison, there, Chuck, I do hear
• 27:34
  Speaker 2: from a lot of retirees. This has been the narrative
• 27:37
  Speaker 2: for over a decade of you know, I'm gonna leave
• 27:39
  Speaker 2: that high tax, high cost of living state in New
• 27:42
  Speaker 2: England and go down to Florida. And for some people,
• 27:45
  Speaker 2: don't get me wrong, this makes a ton of financial sense.
• 27:49
  Speaker 2: But when we think about retirees specifically living in say,
• 27:53
  Speaker 2: I mean fair to say Massachusetts is the highest tax
• 27:56
  Speaker 2: state in New England, Maybe Vermont, now, probably probably New
• 28:01
  Speaker 2: England in terms of total tax burden, especially if you
• 28:04
  Speaker 2: consider the estate tax.
• 28:06
  Speaker 3: I found the state and local tax burden by state
• 28:09
  Speaker 3: from the Tax Foundation. Uh for New England, Well, I'll
• 28:13
  Speaker 3: just give you the national rankings because I can't think
• 28:16
  Speaker 3: through what the math is. Massachusetts has the is the
• 28:20
  Speaker 3: thirty seventh. Massachusetts ranked number thirty seven, which I guess
• 28:25
  Speaker 3: means as the fourteenth highest tax burden out of any
• 28:28
  Speaker 3: state in the country. Right Island is thirty six, so
• 28:30
  Speaker 3: a little better. Connecticut forty nine. Second worst in the
• 28:33
  Speaker 3: country is Connecticut from a tax burd in perspective, New
• 28:35
  Speaker 3: York's the only one that's worse. Uh, let's see who
• 28:39
  Speaker 3: else is here. Maine comes in at forty one, so
• 28:41
  Speaker 3: Main's a little worse than Massachusetts. New Hampshire comes in
• 28:44
  Speaker 3: at sixteen. So New Hampshire's the only New England state
• 28:46
  Speaker 3: like in the top you know, third and vermontsett forty seven.
• 28:49
  Speaker 3: So basically aside from New Hampshire, everyone else is kind
• 28:52
  Speaker 3: of clustered in like.
• 28:53
  Speaker 2: The bottom twentieth percentile. But my point would be, let's
• 28:56
  Speaker 2: focus on Massachusetts for a moment. Yeah, and you're collecting
• 28:59
  Speaker 2: socially majurity, you're collecting maybe imagine for a minute you're
• 29:03
  Speaker 2: collecting a police pension or something like that. Massachusetts doesn't
• 29:07
  Speaker 2: tax those incomes yep. And so you know, certainly while
• 29:12
  Speaker 2: working that Massachusetts FMLA and the income tax coming out
• 29:18
  Speaker 2: of your paycheck is big. It's a big dollar amount,
• 29:22
  Speaker 2: not to mention if you're making like five million dollars
• 29:24
  Speaker 2: a year in Massachusetts and you're paying the extra income tax,
• 29:27
  Speaker 2: the millionaire's tax. But when you get into retirement, it's
• 29:30
  Speaker 2: very much a different story and you do start to
• 29:33
  Speaker 2: think through like, Okay, if I am moving down to Florida,
• 29:36
  Speaker 2: just how much more is my insurance going to?
• 29:38
  Speaker 1: Be? Right? I want?
• 29:40
  Speaker 2: What if I want flood insurance or hurricane insurance? How
• 29:42
  Speaker 2: much is that going to cost me my car insurance
• 29:45
  Speaker 2: goes out, my grocery costs from what I understand, in
• 29:47
  Speaker 2: Florida are substantially higher. That's what I have heard that
• 29:51
  Speaker 2: in Massachusetts. So it is this, it's this balancing act
• 29:56
  Speaker 2: that is not as imbalanced as it was fifteen years ago,
• 30:03
  Speaker 2: which might actually be encouraging for New England states who
• 30:06
  Speaker 2: have been losing young populations for over a decade now.
• 30:11
  Speaker 2: Not Massachusetts as much as some others, but you know
• 30:14
  Speaker 2: that is a little bit encouraging for New England when
• 30:16
  Speaker 2: you start to look at the balance here on cost
• 30:18
  Speaker 2: of living in some of these other states.
• 30:20
  Speaker 3: To take a quick break here. When we come back,
• 30:21
  Speaker 3: we're going to be joined by paul A Monica from
• 30:23
  Speaker 3: Barons and we're gonna be talking Kenview right after this.
• 30:28
  Speaker 1: The global trade war is in full swing. How long
• 30:31
  Speaker 1: will it last? Is anyone's gas? Keep it here for
• 30:34
  Speaker 1: the most up to date information plus breaking news every
• 30:37
  Speaker 1: day right here on the Financial Exchange Radio Network. Find
• 30:42
  Speaker 1: daily interviews in full shows of the Financial Exchange on
• 30:45
  Speaker 1: our YouTube page. Like us on YouTube and get caught
• 30:48
  Speaker 1: up on anything and everything you might have missed. This
• 30:51
  Speaker 1: is the Financial Exchange Radio Network.
• 30:54
  Speaker 3: Ladies and gentlemen the weekend.
• 31:00
  Speaker 5: The Financial Exchange is a proud partner of the Disabled
• 31:02
  Speaker 5: American Veterans Department of Massachusetts and you can register right
• 31:06
  Speaker 5: now for this year's five K at Castle Island by
• 31:10
  Speaker 5: visiting DAV fivek dot Boston. The event will sell out again,
• 31:14
  Speaker 5: so if you're interested in participating, now's the time to
• 31:17
  Speaker 5: reserve your spot. Come out and help support our great
• 31:20
  Speaker 5: American heroes by joining us for the DAV five K.
• 31:23
  Speaker 5: Visit DAV five k dot Boston to register or to
• 31:26
  Speaker 5: make a donation today. That's DAV five k dot Boston.
• 31:32
  Speaker 3: As promised, We're joined now by the one and only
• 31:34
  Speaker 3: Paul Amonica from Barons. Paul, how you doing.
• 31:37
  Speaker 6: I'm good.
• 31:38
  Speaker 3: It's been a week as it it sure has. We're
• 31:41
  Speaker 3: gonna talk a little bit about Kenview today for listeners
• 31:45
  Speaker 3: who are like, what the heck is Kenview? What the
• 31:48
  Speaker 3: heck is Kenview?
• 31:49
  Speaker 6: Yes, it's a great question. Kenview is the consumer healthcare
• 31:54
  Speaker 6: products spin off of Johnson and Johnson. So you may
• 31:59
  Speaker 6: not recognize and ken View, but you probably know most
• 32:02
  Speaker 6: of their major products. That's Tail and all, Benadrill, the Nutrigena,
• 32:08
  Speaker 6: and Avino skincare, skincare brand Zyurgach Listering, so a lot
• 32:13
  Speaker 6: of brand name products you'll find in your local drug store.
• 32:18
  Speaker 6: And you know, the stock has been a bit of
• 32:21
  Speaker 6: a laggard since the spinoff, but there are a couple
• 32:23
  Speaker 6: of analysts who see some you know, potential catalysts that
• 32:27
  Speaker 6: could get the stock moving again.
• 32:28
  Speaker 3: What are those catalysts look like?
• 32:30
  Speaker 6: Yep, yeah, so, analysts said Wolf Research. You know, they
• 32:35
  Speaker 6: noted in a report this week that the valuation for
• 32:39
  Speaker 6: the company, it's very cheap compared to some of their
• 32:44
  Speaker 6: consumer healthcare rivals. You know, it's trading only around eighteen
• 32:50
  Speaker 6: times next year's earnings estimates. The Wolf analysts said that,
• 32:54
  Speaker 6: you know, if you get that back to you know,
• 32:56
  Speaker 6: a multiple of where it's peers trade of around twenty one,
• 33:00
  Speaker 6: stock could be up about twenty percent from current levels.
• 33:04
  Speaker 6: But even that might be a conservative estimate because there
• 33:08
  Speaker 6: are being problems slower growth in the skincare beauty side
• 33:13
  Speaker 6: of their businesses. And if they're able to turn that around,
• 33:17
  Speaker 6: then that could get the stock going even higher. And
• 33:19
  Speaker 6: if they're not able to turn it around, then there
• 33:21
  Speaker 6: might be more pressure to sell it because you now
• 33:24
  Speaker 6: have an activist investor jeff Smith of Starboard Value, who
• 33:30
  Speaker 6: was threatening a proxy fight with the company, but he
• 33:34
  Speaker 6: was able to form a truce with them. He's now
• 33:36
  Speaker 6: on the board, so he's not going to be fighting
• 33:39
  Speaker 6: from the outside, if you will. He's a board member
• 33:42
  Speaker 6: that can exert a little bit more pressure for the
• 33:45
  Speaker 6: company to make some changes.
• 33:47
  Speaker 3: So for you know, generally, when you start talking about,
• 33:50
  Speaker 3: you know, multiple activist investors getting involved, things can get
• 33:54
  Speaker 3: kind of messy in terms of the governance situation. How
• 33:58
  Speaker 3: does an individual actually have that if they're trying to
• 34:01
  Speaker 3: if they're considering investing in the company.
• 34:03
  Speaker 6: Yeah, that's a great question. I think that the key
• 34:06
  Speaker 6: here is that can you analysts are happy that can
• 34:11
  Speaker 6: you very quickly addressed this situation and didn't let it
• 34:16
  Speaker 6: fester and linger and become a long term distraction. So
• 34:20
  Speaker 6: the fact that there's an agreement and Jeffrey Smith at
• 34:24
  Speaker 6: Starboard is now on the company's board, that's something that
• 34:29
  Speaker 6: as one analyst wrote, she thinks that the nimbleness and
• 34:32
  Speaker 6: quickness of you know, how quickly you can be moved,
• 34:37
  Speaker 6: they realize that there is some urgency here, and I
• 34:40
  Speaker 6: think that's something that investors appreciate, and it's one of
• 34:43
  Speaker 6: the reasons why she has a buy on the stock
• 34:46
  Speaker 6: and a target price of twenty seven, which is also
• 34:50
  Speaker 6: again about twenty percent higher than current levels. That's the
• 34:53
  Speaker 6: analyst at Piper Sandler who wrote that.
• 34:56
  Speaker 3: On the other hand, just because something's cheap doesn't mean
• 34:58
  Speaker 3: it has to get more Expensive's what's the downside case
• 35:00
  Speaker 3: if things go badly here?
• 35:03
  Speaker 6: Yeah, obviously you have to be wary anytime a stock
• 35:07
  Speaker 6: is quote unquote cheap that it could be of value trap.
• 35:11
  Speaker 6: And I think there are worries that potentially, you know,
• 35:17
  Speaker 6: the company doesn't turn around the skincare business and is
• 35:20
  Speaker 6: reluctant to try and maybe sell it to another company
• 35:25
  Speaker 6: that might find more value in it. That would be
• 35:27
  Speaker 6: something that would likely drag down the stock. And you know,
• 35:30
  Speaker 6: I think it's also worth noting that even though a
• 35:34
  Speaker 6: lot of the analysts I spoke to for my story
• 35:36
  Speaker 6: are bullish on the stock, by and large, this is
• 35:41
  Speaker 6: a company that you know, analysts still far more mini
• 35:44
  Speaker 6: analysts that follow it have a hold rating on it
• 35:47
  Speaker 6: than a buy. So I think there are definitely worries
• 35:50
  Speaker 6: that this could be you know, dead money for the
• 35:53
  Speaker 6: foreseeable future. But you know there are some pretty savvy
• 35:57
  Speaker 6: analysts on Wall Street that take a different view point.
• 36:00
  Speaker 6: And again, Jeff Smith very very well known as an
• 36:04
  Speaker 6: activist investor at Starboard. You know, having him on the
• 36:08
  Speaker 6: inside now I think is beneficial because he could course
• 36:11
  Speaker 6: some changes without maybe it being as much of a
• 36:13
  Speaker 6: distraction because he's not launching a proxy fight.
• 36:17
  Speaker 3: Very good, Paul, appreciate you joining us today. Thank you
• 36:19
  Speaker 3: so much for the time, and I hope you have
• 36:21
  Speaker 3: a great weekend.
• 36:24
  Speaker 6: Same to you, guys, have a good one.
• 36:26
  Speaker 3: That is paul A Monica from Baron's talking about Kenview.
• 36:31
  Speaker 4: It's been a week, Mike, it has been a week.
• 36:34
  Speaker 4: It's been a week.
• 36:35
  Speaker 2: It's been It's been a busy week for anyone in
• 36:37
  Speaker 2: financial media or in markets. So I want to talk
• 36:40
  Speaker 2: about something that we kind of missed this week, which
• 36:43
  Speaker 2: was all the natural disaster and flooding in the Midwest. Arkansas,
• 36:46
  Speaker 2: Kentucky facing big floods and what it might mean for
• 36:51
  Speaker 2: you up here as well. The uh the Buffalo Trace
• 36:54
  Speaker 2: Distillery has had to temporary close, temporarily closed, and it
• 36:59
  Speaker 2: was announced that there could have been damage. They're closed
• 37:02
  Speaker 2: through yesterday, so I don't have an update on this,
• 37:04
  Speaker 2: but there may have been damage to some of their whiskies.
• 37:08
  Speaker 2: And remember that Buffalo Trace in fact does operate and
• 37:13
  Speaker 2: make the Pappy Van Winkle brand bottling of that bourbon.
• 37:17
  Speaker 2: So if you're holding onto any rare Buffalo Trace bourbons,
• 37:23
  Speaker 2: you might you might, you might be looking at some
• 37:25
  Speaker 2: price increases on those. I don't personally collect alcohol. That
• 37:29
  Speaker 2: I do consume alcohol, but I don't. I've never really
• 37:32
  Speaker 2: understood the idea of the collecting part. It doesn't last
• 37:36
  Speaker 2: that long to and I also don't have tens of
• 37:39
  Speaker 2: thousands of dollars to blow on a bottle of Pappy,
• 37:41
  Speaker 2: so that's also not happening for me. But yeah, good
• 37:44
  Speaker 2: old Buffalo Trace facing some issues due to flooding across
• 37:48
  Speaker 2: the South and Midwest.
• 37:49
  Speaker 3: Taking a look at markets, things remain very boring right now,
• 37:52
  Speaker 3: which is just fine with all of us. The Dow's
• 37:54
  Speaker 3: up thirty one points, the S and P's up nine,
• 37:56
  Speaker 3: the Nasdaq up fifty seven, so a modest upward move
• 38:01
  Speaker 3: right now. Like ten minutes from now, it could be
• 38:03
  Speaker 3: completely different, but at least at this point pretty quiet.
• 38:06
  Speaker 3: Hope everyone has a great weekend again. I know it's
• 38:10
  Speaker 3: been a long week, Take some deep breaths. You know,
• 38:13
  Speaker 3: we'll see what happens Monday. We'll get there, but again,
• 38:18
  Speaker 3: have a great weekend. We'll see you back here on Monday.
• 38:20
  Speaker 3: We get earning season really kicking off next week as
• 38:22
  Speaker 3: well