Latest / The Financial Exchange Show / Are markets forming an 'everything bubble'?

Transcript

Are markets forming an 'everything bubble'? · The Financial Exchange Show

• 0:00
  Speaker 1: The Financial Exchange is produced by Money Matters Radio and
• 0:03
  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 DOC Boston and making
• 1:01
  Speaker 1: a donation today. This is the Financial Exchange with Chuck
• 1:05
  Speaker 1: Zadath and Mike Armstrong.
• 1:11
  Speaker 2: Chuck Mike Tucker with you, and as we kick things
• 1:14
  Speaker 2: off here, we've got a whole bunch of green on
• 1:17
  Speaker 2: the board to start Thanksgiving week. Dow Jones Industrial Average
• 1:22
  Speaker 2: up about point seven percent, three hundred and nineteen points,
• 1:25
  Speaker 2: the S and P five hundred up eighty seven points,
• 1:28
  Speaker 2: about one to third percent, and the NASDAK composite uh up,
• 1:32
  Speaker 2: let's see, we've got yeah, about two percent, four hundred
• 1:35
  Speaker 2: and seventy six points. So we got all of the
• 1:38
  Speaker 2: major US indices, even the cute little Russell two thousand
• 1:41
  Speaker 2: up about one to quarter percent, so we got all
• 1:43
  Speaker 2: of them in positive territory. As we start the week,
• 1:47
  Speaker 2: US ten year Treasury down six tenths of a basis point,
• 1:51
  Speaker 2: not worth getting out of bed for that. It's at
• 1:52
  Speaker 2: four point oh five seven percent. Dollar Index a point
• 1:57
  Speaker 2: oh one percent. Those currency traders really well, you know,
• 2:00
  Speaker 2: making their money today. It's at one hundred point one
• 2:03
  Speaker 2: two five. We got gold up ten to seventy eight
• 2:06
  Speaker 2: ounce to four th ninety and twenty cents, and crude
• 2:09
  Speaker 2: oil West Texas Intermediate up eight cents a barrel to
• 2:12
  Speaker 2: fifty eight to fourteen. We do have a chance later
• 2:15
  Speaker 2: this week, though, to see the TRIPA national average four
• 2:20
  Speaker 2: gas prices get below three dollars a gallon. A bunch
• 2:24
  Speaker 2: of the refineries that have been closed recently have reopened.
• 2:28
  Speaker 2: Gas prices down four tenths of a cent in the
• 2:30
  Speaker 2: last week, but potentially some acceleration there right as you
• 2:33
  Speaker 2: head into one of the busiest travel weeks of the year.
• 2:36
  Speaker 2: So potentially some good news. If you are going to
• 2:38
  Speaker 2: be on the road in the next week or so,
• 2:42
  Speaker 2: you might see some gas a few cents cheaper than
• 2:46
  Speaker 2: it is today.
• 2:47
  Speaker 3: I think one stock worthy of mention.
• 2:49
  Speaker 4: Eli Lilly today became the first ever healthcare company to
• 2:52
  Speaker 4: cross the trillion dollar market cap threshold.
• 2:55
  Speaker 5: I believe it's called the Quatro Commas Club.
• 2:57
  Speaker 3: The Quatro Commas Club. I like that.
• 3:00
  Speaker 5: It's not an original thought and it's stolen from Silicon Valley.
• 3:03
  Speaker 5: There's the Trace Commas Club, billion dollar club.
• 3:06
  Speaker 3: There is the.
• 3:07
  Speaker 5: Quatro Commas Club. It's not quite as you know, catching
• 3:10
  Speaker 5: as Trace Commas, but Quatra Commas.
• 3:12
  Speaker 3: Sure we can make it work.
• 3:13
  Speaker 4: Our appetite for weight loss drugs I like that pretty substantial.
• 3:18
  Speaker 5: Yeah, yeah, how's that. Let's talk a little bit about
• 3:23
  Speaker 5: this piece from CNBC Tucky, do we have any like
• 3:26
  Speaker 5: dramatic music that you can play?
• 3:29
  Speaker 3: You just hummet?
• 3:31
  Speaker 5: Can you hum Kazoo? Uh?
• 3:34
  Speaker 2: I don't know you got like any like Kazoo's doing
• 3:37
  Speaker 2: Star Wars or something like that, because that's kind of
• 3:40
  Speaker 2: what this this piece is.
• 3:41
  Speaker 5: Could markets be facing in everything bubble? Investors are divided?
• 3:47
  Speaker 3: Yeah?
• 3:47
  Speaker 5: Gee, with a topic like that, how could you not
• 3:50
  Speaker 5: be divided? How would we define in everything bubble? Michael?
• 3:54
  Speaker 4: I don't know because last time I checked, tulip prices
• 3:57
  Speaker 4: still pretty reasonable compared to the four teen hundreds or
• 4:00
  Speaker 4: whatever that tulip bubble was.
• 4:02
  Speaker 5: Was it the fourteen hundreds whenever?
• 4:06
  Speaker 4: So I mean, like I feel like when we're talking
• 4:09
  Speaker 4: about like we're not having a we're not having an
• 4:11
  Speaker 4: everything bubble.
• 4:12
  Speaker 3: Everything bubble would mean everything.
• 4:14
  Speaker 5: Like am I in a bubble?
• 4:15
  Speaker 2: Like I feel like I'm Austin Power's like, help, I'm
• 4:17
  Speaker 2: in a nutshell?
• 4:18
  Speaker 1: Like?
• 4:19
  Speaker 5: Is that me in a bubble?
• 4:20
  Speaker 3: Right now? Like?
• 4:21
  Speaker 4: Sixteen thirty six, by the way, was the Dutch tulip bubble?
• 4:23
  Speaker 4: I was off by two hundred years, So.
• 4:25
  Speaker 3: It is pretty bad. I'm sorry.
• 4:27
  Speaker 5: How is this piece even defining everything bubble?
• 4:33
  Speaker 3: Real?
• 4:33
  Speaker 4: Estate, crypto, artificial intelligence, stocks, every other stock. But again,
• 4:39
  Speaker 4: like if you want to go through the five hundred
• 4:42
  Speaker 4: companies in the S and P five hundred, I do
• 4:44
  Speaker 4: think you will find a few of them at least
• 4:46
  Speaker 4: that are reasonably priced compared to their long term average.
• 4:50
  Speaker 4: So no, I don't think we're in an everything bubble.
• 4:53
  Speaker 5: So let's just knock off a few of these just
• 4:55
  Speaker 5: right off the bat. Housing is not a bubble. The
• 5:00
  Speaker 5: prices are unaffordable.
• 5:02
  Speaker 3: That does make it a bubble.
• 5:04
  Speaker 5: Bubble implies that it has to pop in a kind
• 5:08
  Speaker 5: of violent fashion, and I just don't see that happening
• 5:11
  Speaker 5: with housing. I could see like some sideways drift for
• 5:14
  Speaker 5: a few years, But just because something's unaffordable doesn't make
• 5:18
  Speaker 5: it a bubble. The next one that I want to
• 5:21
  Speaker 5: address is crypto. If the default state of something is
• 5:26
  Speaker 5: a bubble, can it ever actually be in a bubble?
• 5:30
  Speaker 5: Because this is what crypto does. It goes through these
• 5:33
  Speaker 5: massive run ups for a couple of years, then massive
• 5:36
  Speaker 5: draw downs, then massive run ups like that's just the
• 5:40
  Speaker 5: state of nature with it, Like you wouldn't you know,
• 5:43
  Speaker 5: get upset at a cheetah for chasing the gazelle? Do
• 5:47
  Speaker 5: you get upset at crypto for going up and down crazily,
• 5:51
  Speaker 5: since it's not tethered to anything real.
• 5:55
  Speaker 4: No, I'm just trying to think if there's been any
• 5:56
  Speaker 4: other asset class similar to it in that way, but
• 5:59
  Speaker 4: I ruggle to think of one. I'm sure there's some
• 6:02
  Speaker 4: emerging market countries stock prices that have seen something similar,
• 6:05
  Speaker 4: but I hesitate to come up with it.
• 6:07
  Speaker 5: So like crypto, I just like, except hey, it's gonna
• 6:09
  Speaker 5: have crazy swings. Some of them are up, some of
• 6:11
  Speaker 5: them are down. It can't be a bubble because there
• 6:14
  Speaker 5: is no intrinsic value, there's no earnings per share.
• 6:18
  Speaker 4: Investors aren't divided on this subject from which perspective that.
• 6:22
  Speaker 3: We're in in everything bubble? They're not.
• 6:24
  Speaker 4: No, the same as is saying that they're divided. But oh,
• 6:27
  Speaker 4: investors are not divided on whether or not we are
• 6:30
  Speaker 4: in a everything bubble.
• 6:32
  Speaker 3: No.
• 6:32
  Speaker 4: Investors right now are concerned that we may be in
• 6:35
  Speaker 4: an artificial intelligence and related companies bubble.
• 6:39
  Speaker 5: We could be in a something bubble, but not in
• 6:41
  Speaker 5: everything bubble.
• 6:42
  Speaker 3: Yeah, I mean, am I missing something here? No?
• 6:46
  Speaker 4: Like yeah, bond prices, I guess a lot of different
• 6:50
  Speaker 4: asset prices have inflated, but that is very typical of
• 6:55
  Speaker 4: a period of time where you've seen dramatic stock price appreciation.
• 6:58
  Speaker 4: Like the junk to treasury yield spread is pretty narrow,
• 7:02
  Speaker 4: meaning people are not pricing in a whole lot of
• 7:06
  Speaker 4: risk for junk bonds. Does that mean that it's a
• 7:10
  Speaker 4: bubble like nothing we've ever seen, as the everything bubble
• 7:13
  Speaker 4: term would insinuate, I don't. I don't even fundamentally understand
• 7:17
  Speaker 4: what this means and what people would be divided by.
• 7:20
  Speaker 5: I don't feel even that we are more bubblicious than
• 7:23
  Speaker 5: we were at the end of twenty twenty one. As
• 7:26
  Speaker 5: an example, like yes, in terms of scale, if AI
• 7:31
  Speaker 5: turns out to be a horrible, you know, a horribly
• 7:36
  Speaker 5: bad allocation of capital from a scale perspective, it would
• 7:40
  Speaker 5: dwarf anything else that we've seen.
• 7:43
  Speaker 4: It's a really good point, Chuckley. Just think back to
• 7:46
  Speaker 4: twenty twenty one. It did feel more ludicrous than at
• 7:51
  Speaker 4: least it to twenty twenty five. There is a narrative
• 7:54
  Speaker 4: to attach to the fantastic prices that we are seeing everywhere.
• 7:58
  Speaker 5: Something Austin could come out of.
• 8:00
  Speaker 4: In twenty twenty one, there was nothing. It was just
• 8:02
  Speaker 4: we have too much money, and we are willing to
• 8:04
  Speaker 4: gamble on anything from South Korean baseball to meme stocks.
• 8:10
  Speaker 2: You want to push a truck down a hill, there's
• 8:12
  Speaker 2: a stock for that you want to you know, like again,
• 8:17
  Speaker 2: a lot of them.
• 8:18
  Speaker 3: Back Mania, like all of that stuff.
• 8:21
  Speaker 4: There was no semblance of any I guess the best
• 8:24
  Speaker 4: argument you could have was that EV's were going to
• 8:27
  Speaker 4: be like seventy percent of the world's fleet of cars.
• 8:29
  Speaker 5: But even there, like you and I had these conversations
• 8:32
  Speaker 5: in twenty one where we said, guys, there's a reason
• 8:36
  Speaker 5: why no one starts car car companies. They are literally
• 8:42
  Speaker 5: money pits. Yeah, it's a hole that you dig in
• 8:45
  Speaker 5: the ground, you put all of your money into it,
• 8:47
  Speaker 5: and there's like a one percent chance that you get
• 8:50
  Speaker 5: any of it back. And it's like, it was very
• 8:52
  Speaker 5: obvious that you couldn't actually make that much money on
• 8:57
  Speaker 5: EV's on artificial intelligence, there's a non zero chance that
• 9:05
  Speaker 5: you can't make any money on it. Hold on, there's
• 9:09
  Speaker 5: there's a real chance.
• 9:10
  Speaker 3: Chance that you can make no money.
• 9:11
  Speaker 5: There's a chance you can make no money on it. Sure,
• 9:13
  Speaker 5: but I do acknowledge, Hey, if you can actually do
• 9:17
  Speaker 5: some of the things that you're talking about. Sure, it's
• 9:20
  Speaker 5: a multi trillion dollar market.
• 9:22
  Speaker 3: Yep.
• 9:23
  Speaker 5: And so I understand why you somewhere between the car
• 9:27
  Speaker 5: companies made no sense yea, And we said it at
• 9:30
  Speaker 5: the time. It's like, guys, who's gonna buy all this stuff?
• 9:33
  Speaker 3: Right?
• 9:34
  Speaker 5: This It's kind of like, Yeah, if you could actually
• 9:36
  Speaker 5: invent a robot that you know, you can sell for
• 9:41
  Speaker 5: x thousands of dollars and it does all of your
• 9:43
  Speaker 5: household chores for you, I could see the market for that.
• 9:47
  Speaker 3: Yeah.
• 9:47
  Speaker 4: If you have an artificial intelligence that is so good
• 9:51
  Speaker 4: at gleaning data that it allows you to come up
• 9:53
  Speaker 4: with new drug combinations to treat diseases that we can't
• 9:57
  Speaker 4: currently figure out use for that, wow, yeah, that could
• 9:59
  Speaker 4: be a huge market.
• 10:00
  Speaker 3: Look at what we're seeing already with weight loss drugs.
• 10:02
  Speaker 4: Imagine if it could do stuff with other things because
• 10:04
  Speaker 4: of artificial intelligence being better at this than the current
• 10:08
  Speaker 4: tools we have.
• 10:09
  Speaker 5: So if you've got to roll backs at least story
• 10:12
  Speaker 5: eight hammers at once and finish a house in a day, yep. Okay,
• 10:16
  Speaker 5: Like I get the use for that. In twenty twenty one,
• 10:20
  Speaker 5: it was just like all insane stuff. This stuff might
• 10:24
  Speaker 5: end up being not real, but you understand the draw
• 10:29
  Speaker 5: to this in a better way than just hey, like,
• 10:33
  Speaker 5: here's I mean, what wasn't twenty twenty one when stuff
• 10:36
  Speaker 5: like dose coins started and it was just like, yeah,
• 10:39
  Speaker 5: here's a picture of a dog. Yeah, on like a meme.
• 10:42
  Speaker 4: Coin or what were the uh art artwork, the digital artwork?
• 10:47
  Speaker 3: NFTs?
• 10:48
  Speaker 5: Oh yeah, there was the NFT peak. Yeah, but I
• 10:52
  Speaker 5: mean the counter to this is like you got la
• 10:54
  Speaker 5: boo boos now or is it labu boos, la boo boos,
• 10:57
  Speaker 5: la boo boos?
• 10:57
  Speaker 3: Yeah, yeah, yeah, boh.
• 11:01
  Speaker 5: It's hard to like, I put this in a different
• 11:04
  Speaker 5: bucket from twenty one because twenty one was just a
• 11:06
  Speaker 5: bunch of things untethered from reality. This is a bunch
• 11:09
  Speaker 5: of things that may change reality. We're just not sure if.
• 11:12
  Speaker 3: They will yet.
• 11:13
  Speaker 5: Let's take a quick break when we come back, let's
• 11:17
  Speaker 5: do a little bit of trivia and are we gonna
• 11:20
  Speaker 5: do blue Owl or they affordability crisis?
• 11:22
  Speaker 3: Michael?
• 11:24
  Speaker 5: Why not both? Right after this?
• 11:27
  Speaker 1: Here the Financial Exchange every day from eleven to noon,
• 11:30
  Speaker 1: Non serious XM's Business Radio Channel one thirty two. Keep
• 11:34
  Speaker 1: it here for the latest business and financial news and
• 11:36
  Speaker 1: the trends on Wall Street. The Financial Exchange is now
• 11:39
  Speaker 1: live on Serious XM's business radio channel one thirty two
• 11:43
  Speaker 1: FACES the Financial Exchange Radio Network. The Financial Exchange streams
• 11:49
  Speaker 1: live on YouTube. Subscribe to our page and stay up
• 11:52
  Speaker 1: to date on breaking business news all morning. Long Face
• 11:55
  Speaker 1: is the Financial Exchange Radio Network.
• 12:00
  Speaker 6: Segment of the Financial Exchange is powered by Circle K
• 12:04
  Speaker 6: Convenience Stores. Circle K is now the official convenience store
• 12:09
  Speaker 6: of the dav Department of Massive chusetts On behalf of
• 12:12
  Speaker 6: Circle K. Thank you veterans for all you've done. Time
• 12:17
  Speaker 6: for trivia here on the Financial Exchange. In today's the
• 12:20
  Speaker 6: eighty fourth birthday of the Beatles. Original drummer Ringo Star
• 12:25
  Speaker 6: didn't join the band until the group returned from their
• 12:28
  Speaker 6: two year residency in Hamburg, Germany, where excuse me when
• 12:32
  Speaker 6: their original drummer was fired. So trivia question today, who
• 12:37
  Speaker 6: is the first drummer for the Beatles? Once again? Who
• 12:40
  Speaker 6: is the first drummer for the Beatles?
• 12:44
  Speaker 5: Uh?
• 12:44
  Speaker 6: Be the sixth person today to text us at six one, seven, three, six,
• 12:49
  Speaker 6: two thirteen eighty five with the correct answer, and you
• 12:51
  Speaker 6: win a Financial Exchange Show T shirt. You also have
• 12:54
  Speaker 6: to use the keyword trivia in your texts. So text
• 12:57
  Speaker 6: the keyword trivia to that number six one seven three
• 13:01
  Speaker 6: six two thirteen eighty five, and you win a Financial
• 13:04
  Speaker 6: Exchange Show T shirt. Once again, the six correct response
• 13:07
  Speaker 6: to Texas to the number six one seven three six
• 13:10
  Speaker 6: two thirteen eighty five along with the keyword trivia, we'll
• 13:14
  Speaker 6: win that T shirt. See complete contest rules at Financial
• 13:17
  Speaker 6: Exchange Show dot com.
• 13:20
  Speaker 5: I guess the headline writers are just pulling out all
• 13:23
  Speaker 5: the stops today. We got this one from Bloomberg. Blue
• 13:26
  Speaker 5: Owl is the sum of all investor fears. Okay, so
• 13:31
  Speaker 5: here's the deal. Blue Owl is an asset manager. They
• 13:34
  Speaker 5: managed about three hundred billion dollars.
• 13:35
  Speaker 3: I was gonna say that, isn't that the name of
• 13:37
  Speaker 3: a famous movie.
• 13:37
  Speaker 4: It was the Faust movie, a famous famous book, right,
• 13:40
  Speaker 4: some of all for Ben Affleck.
• 13:42
  Speaker 3: Yeah, yeah, I think it's sucked Tom Clancy.
• 13:44
  Speaker 5: Okay, it's a very c plus Tom Clancy movie. Like,
• 13:50
  Speaker 5: there's much better ones if you want to go like
• 13:51
  Speaker 5: clear in Present Danger or something like that. Anyways, I
• 13:54
  Speaker 5: digress blue Owl. They manage about three hundred million dollars.
• 13:57
  Speaker 5: About half of that is in the private credits space,
• 14:00
  Speaker 5: which basically means that they make loans to companies that
• 14:02
  Speaker 5: are not through public facing bond markets. And I'll just
• 14:07
  Speaker 5: quote here from Bloomberg because I do think they actually
• 14:08
  Speaker 5: sum it up well. Blue Owl Capital has caught into
• 14:11
  Speaker 5: trifective market worries about private credit, artificial intelligence, and the
• 14:15
  Speaker 5: flightiness of wealthy individuals who have been the new growth
• 14:18
  Speaker 5: hope for alternative managers in recent years. The reason why
• 14:21
  Speaker 5: that last one matters typically private credit space kind of
• 14:25
  Speaker 5: the exclusive domain of pension funds insurers, but made.
• 14:30
  Speaker 3: It more money. So where do they go?
• 14:32
  Speaker 5: They said, yes, we want to, you know, start tapping
• 14:34
  Speaker 5: you know, wealthy individuals, same way that private equity firms
• 14:37
  Speaker 5: have and hedge funds and so on and so forth,
• 14:41
  Speaker 5: and now they're trying to put it into your four
• 14:42
  Speaker 5: O one k. Ultimately, what we have here is a
• 14:47
  Speaker 5: question of do the companies that Blue Owl and subsidiaries
• 14:52
  Speaker 5: and other people have lent to do those companies have
• 14:55
  Speaker 5: enough money to pay back the debt they've taken out Right,
• 14:58
  Speaker 5: There have been a couple of high profile ins instances
• 15:00
  Speaker 5: where firms funded by private credit have not been able
• 15:04
  Speaker 5: to in recent months, mostly in the auto sector, but
• 15:07
  Speaker 5: there was one in the housing sector as well. And
• 15:10
  Speaker 5: so you've kind of got this drum beat out there
• 15:12
  Speaker 5: where no one's quite sure what all this stuff is worth.
• 15:16
  Speaker 5: It's compounded by a couple of other bankruptcies in the
• 15:19
  Speaker 5: defaults in the last month or so in this space
• 15:24
  Speaker 5: where companies were having their loans fully valued by their
• 15:28
  Speaker 5: issuers right up until the day when they said, nope,
• 15:31
  Speaker 5: you can't pay anything, and we're actually going to write
• 15:33
  Speaker 5: this down to zero.
• 15:34
  Speaker 4: Right, So you can to some degree understand the frustration
• 15:37
  Speaker 4: by the CEOs in this space. At Blue Owl, for instance,
• 15:41
  Speaker 4: the average annualized credit losses are running at zero point
• 15:44
  Speaker 4: one three percent of total loans, and so one of the.
• 15:48
  Speaker 3: CEOs is out there. They have co CEOs at Blue Owl,
• 15:50
  Speaker 3: and you know.
• 15:51
  Speaker 4: Kind of giving these exasperated speeches of why did the
• 15:54
  Speaker 4: narrative turn here?
• 15:55
  Speaker 3: There's no real problem, YadA.
• 15:57
  Speaker 4: YadA also acknowledging for a moment that his company only
• 16:01
  Speaker 4: works if they do have a market to continue to
• 16:04
  Speaker 4: lend out new money and buyers for that debt. So
• 16:07
  Speaker 4: he's got some in vested interest in making sure that
• 16:09
  Speaker 4: this gravy train continues. But to his point, there have
• 16:13
  Speaker 4: been very few defaults in this space. There is you know,
• 16:16
  Speaker 4: generally no aggregate looming issue, but when you have for
• 16:24
  Speaker 4: really public defaults, and it can quickly change the narrative
• 16:29
  Speaker 4: over to this being a real problem. And so, as
• 16:32
  Speaker 4: we said before, it's going to take some time to
• 16:34
  Speaker 4: kind of figure out. But for some time, these companies
• 16:39
  Speaker 4: have been claiming to their investors and to the general
• 16:42
  Speaker 4: public that they are just much better at underwriting than
• 16:47
  Speaker 4: previous issuers of this type of debt. And I think
• 16:51
  Speaker 4: that that statement has been called into question with some
• 16:54
  Speaker 4: of these big defaults that Blue Owl, by the way,
• 16:57
  Speaker 4: wasn't really connected to in any way.
• 16:58
  Speaker 5: No, I think here's the question that I think is
• 17:02
  Speaker 5: worth asking. Then, if you're actually that good at underwriting
• 17:06
  Speaker 5: this debt, and if the default rate is that low,
• 17:10
  Speaker 5: then why are the interest rates that are charged to
• 17:13
  Speaker 5: the companies borrowing through private credit markets in the low
• 17:17
  Speaker 5: double digits right now? Because if there really isn't that
• 17:21
  Speaker 5: much risk in them, then why do you have to.
• 17:25
  Speaker 4: Underwrite money of borrowers willing to Why were plenty of lenders?
• 17:28
  Speaker 5: Why will more lenders lend to these companies at seven
• 17:30
  Speaker 5: eight nine percent instead of twelve thirteen fourteen percent. That's
• 17:35
  Speaker 5: the one that's out there and that I have a
• 17:36
  Speaker 5: hard time getting my head around, which is, yeah, if
• 17:40
  Speaker 5: it's really if you're really that good at it, why
• 17:43
  Speaker 5: is the market pricing it as if it's still kind
• 17:47
  Speaker 5: of junkie debt.
• 17:49
  Speaker 4: I don't think you're a monopoly. You're not the only
• 17:51
  Speaker 4: place that can go lend out money to small borrowers.
• 17:53
  Speaker 5: No, there's dozens of these companies that do this. You know,
• 17:56
  Speaker 5: even at this scale, there's there's dozens of these companies
• 17:59
  Speaker 5: that do this. Everyone's talking about the affordability crisis. It
• 18:02
  Speaker 5: can't be solved. I agree with this piece from Greg Yep.
• 18:06
  Speaker 5: The tools that governments use in order to manage their
• 18:13
  Speaker 5: constituencies or either's local, state, or federal level. We do
• 18:18
  Speaker 5: not have tools to make things more affordable. No, we don't,
• 18:25
  Speaker 5: and I take it back, we do. The tool to
• 18:29
  Speaker 5: make things more affordable is competition and allowing companies to
• 18:35
  Speaker 5: have to compete on price in order to make things
• 18:38
  Speaker 5: more I was going to say, or raise wages, which
• 18:41
  Speaker 5: makes things more affordability.
• 18:42
  Speaker 4: Is a contributing factor of two things, prices and wages. Yes,
• 18:45
  Speaker 4: and I would argue trying to lower prices or hold
• 18:49
  Speaker 4: them where they are can't do. It is a hell
• 18:51
  Speaker 4: of a lot more difficult than trying to create conditions
• 18:53
  Speaker 4: under which wages can increase.
• 18:55
  Speaker 5: Competition raises wages and lowers prices because you have to
• 18:59
  Speaker 5: compet for labor and you have people that you're competing
• 19:03
  Speaker 5: against on price.
• 19:04
  Speaker 3: But it's easy to get confused about that.
• 19:06
  Speaker 4: And so we're going to probably test some of the
• 19:09
  Speaker 4: dumb policies that we've had before, such as twenty dollars
• 19:12
  Speaker 4: fast food minimum wages, and rent control and all sorts
• 19:16
  Speaker 4: of fun things which I heard, by the way, is
• 19:18
  Speaker 4: making it onto the Massachusetts ballot some rent control measures
• 19:21
  Speaker 4: here in the States. So exciting news to come.
• 19:24
  Speaker 5: Let's take a quick break.
• 19:25
  Speaker 2: When we come back, we've got Wall Street Watch, We've
• 19:27
  Speaker 2: got the trivia answer, and then we'll discuss whether the
• 19:30
  Speaker 2: real poverty line is one hundred and forty thousand dollars
• 19:32
  Speaker 2: in income.
• 19:39
  Speaker 1: Bringing the latest financial news straight to your radio every day,
• 19:43
  Speaker 1: it's the Financial Exchange on the Financial Exchange Radio Network.
• 19:49
  Speaker 7: We're proud to announce that circle K is now the
• 19:51
  Speaker 7: official convenience store of the dav Department of Massachusetts. At
• 19:55
  Speaker 7: circle K, supporting those who bravely served our country isn't
• 19:58
  Speaker 7: just a commitment heartfelt mission. Circle K is honored to
• 20:02
  Speaker 7: stand with the dav Department of Massachusetts to ensure that
• 20:05
  Speaker 7: veterans receive the care and recognition they deserve. If you'd
• 20:08
  Speaker 7: like to do your part, please visit DAVMA dot org.
• 20:12
  Speaker 7: Thank you for standing with circle K and the dav
• 20:14
  Speaker 7: Department of Massachusetts, and thank you veterans for all you've done.
• 20:20
  Speaker 1: Time now for Wall Street. Watch a complete look at
• 20:23
  Speaker 1: what's moving markets so far today right here on the
• 20:26
  Speaker 1: Financial Exchange Radio Network.
• 20:32
  Speaker 6: All after last week's shoppy ride, markets are beginning the
• 20:37
  Speaker 6: holiday shortened week well into positive territory as traders away
• 20:41
  Speaker 6: more economic data releases, including the Producer Price Index in
• 20:45
  Speaker 6: retail sales. Right now, Dow is up over half a percent,
• 20:49
  Speaker 6: or two hundred and sixty points, SMP five hundred is
• 20:52
  Speaker 6: up one point four percent or ninety one points, Nasdaq
• 20:55
  Speaker 6: surging two point three percent higher or five hundred and
• 20:59
  Speaker 6: seventeen points, RUSTED to two thousand is up nearly one
• 21:02
  Speaker 6: and a half percent, Tenure Treasure realed is flat at
• 21:06
  Speaker 6: four point zero five four percent, and crude oil up
• 21:09
  Speaker 6: about half a percent, treading just above fifty eight dollars
• 21:13
  Speaker 6: a barrel test. The CEO Elon Musk posted t X
• 21:16
  Speaker 6: that the company has started work on the next generation
• 21:19
  Speaker 6: of AI chips to be used in cars and data center,
• 21:22
  Speaker 6: sending Tesla shares up by seven percent. Now sticking with
• 21:26
  Speaker 6: AI where Alphabet stock is rallying nearly five percent following
• 21:31
  Speaker 6: glowing reviews of its recently launched Gemini three AI model. Meanwhile,
• 21:35
  Speaker 6: Ali Baba stock is almost five percent higher after the
• 21:38
  Speaker 6: company announced its AI app Quinn, had ten million downloads
• 21:42
  Speaker 6: within its first week of launching. Elsewhere, Nova Nord Disk
• 21:46
  Speaker 6: shares sinking about six percent after the pharmaceutical company said
• 21:50
  Speaker 6: it's highly anticipated trial for Alzheimer's disease failed to meet
• 21:54
  Speaker 6: its main goal and struggling retailer Coals named Michael Bender
• 21:58
  Speaker 6: as its new CEO, marking the third CEO the department
• 22:01
  Speaker 6: store has had in the last three years. Bender has
• 22:04
  Speaker 6: been serving as the company's interim CEO since May. Colestock
• 22:09
  Speaker 6: is now edging higher. I'm Tucker Silva and that is
• 22:12
  Speaker 6: Wall Street Watch. And in the previous segment we asked
• 22:15
  Speaker 6: you the trivia question who was the first drummer of
• 22:18
  Speaker 6: the Beatles? Well, that would be Pete Best and our
• 22:23
  Speaker 6: winner today was John from Portsmouth, Rhode Island, taking on
• 22:26
  Speaker 6: the Financial Exchange Show t shirt. Congrats to John, and
• 22:29
  Speaker 6: we played trivia every day here in the Financial Exchange
• 22:32
  Speaker 6: See complete contest rules at Financial Exchange Show dot com.
• 22:37
  Speaker 5: All right, Mike, we have to have a conversation about
• 22:41
  Speaker 5: the federal poverty line.
• 22:43
  Speaker 3: Yeah, we might need to find.
• 22:46
  Speaker 4: What poverty actually means as part of this, but the
• 22:49
  Speaker 4: federal government does produce a level of income where you
• 22:54
  Speaker 4: are considered impoverished.
• 22:56
  Speaker 5: Yes, and that uh, basically that limit if you look
• 23:02
  Speaker 5: at it, it varies based on family size, as you
• 23:04
  Speaker 5: would expect. Sure, if you are a just single individual
• 23:08
  Speaker 5: living on your own, it's below fifteen six hundred and
• 23:10
  Speaker 5: fifty dollars this year. If you have if you're married
• 23:15
  Speaker 5: or it's two of you living together, it's about twenty
• 23:16
  Speaker 5: one thousand. If you have twelve kids, it's about eighty
• 23:20
  Speaker 5: seven thousand. Not many twelve kid households these days, so
• 23:23
  Speaker 5: it's probably in the minority. But basically the federal poverty
• 23:27
  Speaker 5: line is it's defined basically so as to you know,
• 23:34
  Speaker 5: have it's the minimum income level to meet some basic
• 23:38
  Speaker 5: needs such as food, housing, and healthcare and it gets
• 23:41
  Speaker 5: updated annually.
• 23:43
  Speaker 4: And not coincidentally, the federal minimum wage at seven dollars
• 23:46
  Speaker 4: twenty five cents per hour, if you worked a full
• 23:49
  Speaker 4: forty hour week for fifty two weeks a year, would
• 23:51
  Speaker 4: get you about fifteen thousand dollars in income.
• 23:54
  Speaker 5: So there is a manager at Simplify Asset Management by
• 23:59
  Speaker 5: name of Mike Green. I'm familiar with Mike's work, and
• 24:03
  Speaker 5: I think he's generally a pretty sharp guy actually, but
• 24:08
  Speaker 5: he basically looked at a bunch of different data points
• 24:13
  Speaker 5: and said, no, if we're actually looking at what this
• 24:17
  Speaker 5: you know should be defined as that limit is closer
• 24:21
  Speaker 5: to one hundred and forty thousand dollars, and I just
• 24:24
  Speaker 5: don't think that that holds up when you, you know,
• 24:27
  Speaker 5: actually look at this.
• 24:30
  Speaker 4: I am willing to say that at thirty thousand dollars
• 24:33
  Speaker 4: a year, which is that's the level for the family
• 24:36
  Speaker 4: of four, right was around thirty.
• 24:38
  Speaker 5: Uh yeah, for let me pull it up for thirty
• 24:40
  Speaker 5: Oh yeah, it's thirty thirty two thousand.
• 24:43
  Speaker 4: I'm willing to say that even under forty or fifty
• 24:45
  Speaker 4: thousand dollars in most parts of the country, as a
• 24:47
  Speaker 4: family of four, you are impoverished at levels of income
• 24:50
  Speaker 4: higher than thirty two thousand dollars, I'm really not willing
• 24:54
  Speaker 4: to get to the one hundred and forty thousand dollars level.
• 24:56
  Speaker 5: No, And here's why, in my opinion, it doesn't make sense. First, like,
• 25:01
  Speaker 5: you look at the stuff that is included in here,
• 25:03
  Speaker 5: and just as an example, thirty two thousand dollars a
• 25:07
  Speaker 5: year for childcare. There is no world in which that
• 25:14
  Speaker 5: is what you need to spend on childcare year after
• 25:18
  Speaker 5: year after year.
• 25:21
  Speaker 4: Likewise, if you are spending if you are earning thirty
• 25:25
  Speaker 4: two thousand dollars a year in income, there's almost no
• 25:28
  Speaker 4: way that you are choosing to engage a childcare provider.
• 25:32
  Speaker 5: Correct, you will just stay alone and not work. Twenty
• 25:38
  Speaker 5: three thousand, two sixty seven for housing. That's two thousand
• 25:41
  Speaker 5: dollars a month in rent. I can tell you in
• 25:43
  Speaker 5: some parts of the country it's going to be really
• 25:45
  Speaker 5: hard to find a place for under two thousand a
• 25:46
  Speaker 5: month in rent. In large swaths of it, you can
• 25:50
  Speaker 5: absolutely find a place for under two thousand dollars a
• 25:52
  Speaker 5: month in rent. Fourteen seven hundred and seventeen for food,
• 25:56
  Speaker 5: And again this was looking at a family of four
• 25:59
  Speaker 5: about one thousand dollars twelve hundred dollars a month, we'll
• 26:02
  Speaker 5: call it, so about three hundred dollars a week. Guys,
• 26:05
  Speaker 5: I gotta tell you, I do my grocery shopping for
• 26:08
  Speaker 5: my family every single week, and without like, without having
• 26:14
  Speaker 5: to manage things tightly, and we're a family of four,
• 26:17
  Speaker 5: we're generally right around that level. If I wanted to
• 26:22
  Speaker 5: actually like coupon clip and bargain hunt and really do
• 26:26
  Speaker 5: some work on it, I could get that down by
• 26:29
  Speaker 5: at least thirty percent.
• 26:31
  Speaker 3: In either case.
• 26:32
  Speaker 4: And by the way, I'm taking Massachusetts data here as
• 26:34
  Speaker 4: an example for a four person household. If you're earning
• 26:38
  Speaker 4: less than fifty two hundred dollars a month, then you
• 26:41
  Speaker 4: qualify for SNAP benefits. And so we have some you know,
• 26:45
  Speaker 4: government intervention here that's confusing this matter further.
• 26:48
  Speaker 5: Another one fourteen and twenty eight for transportation. Guys, I
• 26:52
  Speaker 5: can tell like, again, this might be the average spending
• 26:56
  Speaker 5: that you see out there, because again this was national
• 26:58
  Speaker 5: average data. Below the national average is not poverty. There's
• 27:03
  Speaker 5: another like line before you get there, ten thousand dollars.
• 27:07
  Speaker 4: By the way, that fourteen thousand number is one absolutely
• 27:11
  Speaker 4: impacted by you know, the average price for a new
• 27:14
  Speaker 4: car correct which.
• 27:16
  Speaker 5: Or even a car in general, there are like, there
• 27:18
  Speaker 5: are plenty of ways to get transportation in many parts
• 27:22
  Speaker 5: of the country that don't involve buying a new car.
• 27:25
  Speaker 5: It might be as simple as a bus pass free,
• 27:28
  Speaker 5: you know, each month. That might be a couple hundred
• 27:29
  Speaker 5: bucks or something, or a train pass each month for
• 27:33
  Speaker 5: a few hundred dollars, like you, it does not have
• 27:35
  Speaker 5: to be fourteen fifteen thousand dollars for transportation ten thousand
• 27:41
  Speaker 5: for healthcare. Like honestly, no one knows the cost of healthcare.
• 27:43
  Speaker 5: I'm not going to put up a fight there if
• 27:44
  Speaker 5: you want to tell me that that's you know what
• 27:46
  Speaker 5: it is when you include all your deductibles and out
• 27:48
  Speaker 5: of pocket and this and that.
• 27:49
  Speaker 4: I'll say that according to Fidelities annual study that they
• 27:53
  Speaker 4: do on retirees, that a single individual who's retired is
• 27:57
  Speaker 4: expected to spend some six thousand plus dollars a year
• 28:00
  Speaker 4: you're on healthcare, So it wouldn't surprise him buy that
• 28:03
  Speaker 4: that ten thousand dollars for a family of four would
• 28:05
  Speaker 4: be the kind of bare minimum.
• 28:06
  Speaker 5: And then you know, twenty two thousand for other essentials.
• 28:09
  Speaker 5: I'm guessing that's, you know, clothing, and I don't know
• 28:13
  Speaker 5: how you get to twenty thousand for other essentials like.
• 28:17
  Speaker 3: That.
• 28:17
  Speaker 5: Seems like a lot for essentials.
• 28:19
  Speaker 3: Yeah.
• 28:21
  Speaker 5: In any case, if we want to make an argument, hey,
• 28:24
  Speaker 5: the federal poverty line for a family of four should
• 28:27
  Speaker 5: be fifty thousand instead of thirty, I think we can
• 28:31
  Speaker 5: have a reasonable conversation there. One hundred and forty thousand,
• 28:36
  Speaker 5: I don't think we can have a reasonable conversation.
• 28:39
  Speaker 4: Yeah, seems a little bit off. It does remind me
• 28:41
  Speaker 4: of a point, though, Chuck, that I know you and
• 28:43
  Speaker 4: I have talked about at length, which is there's always
• 28:49
  Speaker 4: in everyone's circle like keeping up with the Joneses mentality,
• 28:53
  Speaker 4: and we see that expense.
• 28:55
  Speaker 3: Creep with clients that we work with all the time.
• 28:58
  Speaker 4: And I've said this publicly a few times, where I
• 29:01
  Speaker 4: have met families who are pulling in half a million
• 29:05
  Speaker 4: dollars or more and are in terrible financial health. They
• 29:11
  Speaker 4: don't save anything, they rack up debt, they are not
• 29:14
  Speaker 4: going to save enough to retire on. And I've met
• 29:17
  Speaker 4: families that have earned at most one hundred thousand dollars
• 29:21
  Speaker 4: a year and are in excellent financial health without long
• 29:25
  Speaker 4: term debt without credit card debt, and enough savings in
• 29:28
  Speaker 4: the retirement to afford their lifestyle. And that's where it
• 29:30
  Speaker 4: comes down to that discipline and that understanding of what
• 29:34
  Speaker 4: your future is going to look like to save properly
• 29:37
  Speaker 4: for that future. If you are trying to assess where
• 29:41
  Speaker 4: you are in that saving journey that we all have
• 29:45
  Speaker 4: to embark on in our working years, and you're trying
• 29:48
  Speaker 4: to figure out, Hey, what is my dollar amount that
• 29:50
  Speaker 4: I need to get to.
• 29:50
  Speaker 3: What is my age that I need.
• 29:52
  Speaker 4: To get to before I can afford to pull back
• 29:54
  Speaker 4: from work and retire and live comfortably for the rest
• 29:56
  Speaker 4: of my life. That's what Armstrong Advisory Group does every
• 29:59
  Speaker 4: day when working with our clients. If you have those
• 30:02
  Speaker 4: types of questions, I urge you to call us at
• 30:04
  Speaker 4: eight hundred three nine three for zero zero one and
• 30:07
  Speaker 4: get your free financial check up. The number again for
• 30:11
  Speaker 4: the Armstrong Advisory Group eight hundred three nine three for
• 30:14
  Speaker 4: zero zero one.
• 30:15
  Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
• 30:18
  Speaker 1: registered investment advisor. Nothing in the ad or in any
• 30:20
  Speaker 1: Armstrong guide a specific financial, legal or tax advice. Consult
• 30:23
  Speaker 1: your own financial tax and to state planning advisors before
• 30:26
  Speaker 1: making any investment decisions. Armstrong may contact you to offer
• 30:29
  Speaker 1: investment advisory services.
• 30:31
  Speaker 5: Let's see, I kind of like this piece here how
• 30:34
  Speaker 5: spouse is retiring at different times can avoid money clashes
• 30:38
  Speaker 5: because I've seen this first hand. Actually with you have
• 30:42
  Speaker 5: a couple who you know, someone seventy five, someone is
• 30:47
  Speaker 5: sixty two in the relationship, and the seventy five year
• 30:50
  Speaker 5: old is quite literally in some cases, being like, hey,
• 30:54
  Speaker 5: I'm gonna die soon. We got to spend some money.
• 30:57
  Speaker 3: Yeah, And the sixty two.
• 30:58
  Speaker 5: Year old is like, I might have third so you're
• 31:00
  Speaker 5: forty years left. I don't want to be broke.
• 31:03
  Speaker 4: Yeah, the you have to be Look, it's not to
• 31:08
  Speaker 4: interject myself into spouses into a couple's life, but there
• 31:12
  Speaker 4: are added risks when you are i would say, marrying
• 31:17
  Speaker 4: somebody that is greater than five years your age difference. Yeah, right,
• 31:22
  Speaker 4: Like you think about that example, and I've seen it before. Right,
• 31:25
  Speaker 4: the older spouse has a pension. How much homework did
• 31:29
  Speaker 4: you do to make sure that there's a survivor benefit
• 31:31
  Speaker 4: on that pension or if they were the primary income
• 31:34
  Speaker 4: earn or when their social Security goes away, that I'm
• 31:36
  Speaker 4: going to have something left over. It's a little bit
• 31:38
  Speaker 4: easier these days with investments making up a larger portion
• 31:42
  Speaker 4: of it. Sure, but there's a lot of those types
• 31:44
  Speaker 4: of questions that don't apply to a couple that's both
• 31:47
  Speaker 4: turning sixty five the same year. The other one that
• 31:49
  Speaker 4: I always ask people when there's an age difference and
• 31:51
  Speaker 4: somebody's retiring, it's how comfortable are you, uh, with seeing
• 31:56
  Speaker 4: your spouse.
• 31:59
  Speaker 3: Not go to work every day?
• 32:01
  Speaker 4: Because that's a that's a challenge when that spouse is,
• 32:03
  Speaker 4: you know, heading to the golf course or spending time
• 32:06
  Speaker 4: with the grandkids and you can't because you're commuting to work.
• 32:08
  Speaker 3: It's a real pain point in some relationships.
• 32:11
  Speaker 5: Oh, I mean I never went through that, but I
• 32:14
  Speaker 5: can tell you it as like a twenty five year
• 32:17
  Speaker 5: old you know, a couple of roommates at the time,
• 32:20
  Speaker 5: and one summer they both got into business school and
• 32:24
  Speaker 5: took the summer off and I'm still working. I'm kind
• 32:26
  Speaker 5: of looking at them and I'm like, they're literally just
• 32:28
  Speaker 5: like going and again, like hanging out at the beach
• 32:31
  Speaker 5: day and I'm sitting there, I'm like, guys, I don't
• 32:35
  Speaker 5: think we can do this long term. This isn't gonna work,
• 32:38
  Speaker 5: So yeah, I can. I can relate to that a
• 32:39
  Speaker 5: little bit. Just take a quick break when we come back.
• 32:42
  Speaker 5: Stack Roulette.
• 32:44
  Speaker 1: Finding daily interviews and full shows of the Financial Exchange
• 32:47
  Speaker 1: on our YouTube page. Subscribe to our page and get
• 32:50
  Speaker 1: caught up on anything and everything you might have missed.
• 32:53
  Speaker 1: This is the Financial Exchange Radio Network. The Financial Exchange
• 32:59
  Speaker 1: is Life XM's Business radio channel one thirty two weekdays
• 33:03
  Speaker 1: from eleven to noon. Get the latest business and financial
• 33:06
  Speaker 1: news from across the country and around the world, and
• 33:09
  Speaker 1: keep up to date on how it might affect your wallet.
• 33:12
  Speaker 1: That's the Financial Exchange weekdays from eleven to noon on
• 33:15
  Speaker 1: Series XM's Business Radio Channel one thirty two. Face He's
• 33:19
  Speaker 1: the Financial Exchange Radio Network.
• 33:28
  Speaker 6: This segment of The Financial Exchange is brought to you
• 33:30
  Speaker 6: by the US Virgin Islands Department of Tourism. Your next
• 33:33
  Speaker 6: incredible vacation is a click away, and if you act fash,
• 33:37
  Speaker 6: you could be on Sant Croix to experience their Crucing
• 33:39
  Speaker 6: Christmas Festival taking place this December through early January. Discover
• 33:44
  Speaker 6: the magic of this long standing tradition with incredible food,
• 33:47
  Speaker 6: music and entertainment, or just go soak up the sun
• 33:50
  Speaker 6: strong along white sand beaches and feel the rhythm of
• 33:54
  Speaker 6: the heartbeat of the islands. The USVII is America's cribean paradise.
• 33:58
  Speaker 6: Plan your escape now. Visit u USBI dot com. That's
• 34:01
  Speaker 6: visit USBI dot com.
• 34:03
  Speaker 5: Mike, what do you got for stack roulette?
• 34:05
  Speaker 4: I keep seeing all these pieces about the California twenty
• 34:07
  Speaker 4: dollars fast food minimum wage law and people trying to
• 34:10
  Speaker 4: study the effects. The California fast food minimum wage law,
• 34:13
  Speaker 4: if you're not familiar, applies to any fast food company
• 34:17
  Speaker 4: that maintains at least sixty restaurants, so pretty much all
• 34:22
  Speaker 4: of them past in twenty twenty three, went into effect
• 34:27
  Speaker 4: in April of twenty twenty four, and so like.
• 34:31
  Speaker 3: As early as.
• 34:31
  Speaker 4: January this year, I started seeing pieces like, oh, this
• 34:34
  Speaker 4: is how many jobs. Yeah, the new minimum wage law
• 34:37
  Speaker 4: has killed. I do suspect it is going to kill jobs.
• 34:41
  Speaker 4: You can't measure it yet, it's not long enough. You
• 34:45
  Speaker 4: have to give a time to actually be measured. There's
• 34:47
  Speaker 4: been some studies, you know, showing that there hasn't been
• 34:49
  Speaker 4: any spillover to other industries. I find that to be
• 34:53
  Speaker 4: pretty useless as well. Basically saying that you know, it
• 34:55
  Speaker 4: hasn't driven up wages at full service restaurants. The only
• 34:59
  Speaker 4: thing that they've able to been able to distinguish so
• 35:02
  Speaker 4: far is that workers at these restaurants there seems to
• 35:05
  Speaker 4: be less turnover. Unsurprising, Yeah, but I do suspect. Yeah, overall,
• 35:12
  Speaker 4: five years from April of twenty twenty four, will there
• 35:15
  Speaker 4: be fewer fast food workers per dollars spent on fast food? Absolutely,
• 35:22
  Speaker 4: But again you have to measure these things in an
• 35:24
  Speaker 4: intelligent way, because it's not if the population of California
• 35:27
  Speaker 4: goes up another ten percent between now when you measure it,
• 35:29
  Speaker 4: there could still be more workers and fast food in
• 35:31
  Speaker 4: spite of the new law.
• 35:33
  Speaker 5: I want to talk about this piece that Tucker dug
• 35:35
  Speaker 5: up from the New York Times, and Ai toy Bear
• 35:38
  Speaker 5: speaks of sex knives and pills at Consumer Group warns, Okay,
• 35:42
  Speaker 5: we've ordered them for the entire the Christmas gifts, Yes,
• 35:47
  Speaker 5: Christmas gifts for the entire production staff.
• 35:49
  Speaker 3: How much of these things cost?
• 35:50
  Speaker 5: Could they ninety nine dollars?
• 35:52
  Speaker 4: Okay, so it's not it's gonna be a little bit
• 35:54
  Speaker 4: too expensive for you guys to afford for a trivia
• 35:56
  Speaker 4: contest winner.
• 35:56
  Speaker 1: Huh.
• 35:57
  Speaker 5: But here's the thing, Like, we got a couple things
• 35:59
  Speaker 5: to talk about this, starting with the fact that one
• 36:02
  Speaker 5: of these toys, it's a plush rocket with the removable speaker.
• 36:06
  Speaker 4: It's called grock and it's designed for kids age three
• 36:09
  Speaker 4: to twelve.
• 36:10
  Speaker 5: I'm sorry, we got to stop naming everything grock. That
• 36:12
  Speaker 5: is artificial intelligence. There's at least four platforms that I
• 36:16
  Speaker 5: know of, including this, that are using it. So it's
• 36:18
  Speaker 5: Elon Musk's so Elon Musk has one.
• 36:21
  Speaker 2: There's another AI platform, there's this, and there's another toy
• 36:25
  Speaker 2: that I forget what it does.
• 36:27
  Speaker 5: But here's the deal you got, Like, if all of
• 36:31
  Speaker 5: you are gonna name your toys groc and all your
• 36:34
  Speaker 5: platforms grock, you're basically proving that there is no real
• 36:37
  Speaker 5: creativity and artificial intelligence because you're literally just pulling a
• 36:41
  Speaker 5: term from a Robert Heinland novel and using it as
• 36:44
  Speaker 5: your own because you have no originality. Yes, so grow
• 36:48
  Speaker 5: up or do better either. One beyond that, if your
• 36:53
  Speaker 5: AI plush toy, you know, starts talking to kids about
• 36:58
  Speaker 5: you know, taking pills, knives and sex and stuff like that,
• 37:03
  Speaker 5: you probably haven't done enough work to make sure that
• 37:06
  Speaker 5: it's actually.
• 37:08
  Speaker 4: Good I'll go a step further and say, parents, if
• 37:12
  Speaker 4: you are buying your three to twelve year old an
• 37:15
  Speaker 4: AI based toy, don't you are idiots? I'm no, no, Okay,
• 37:23
  Speaker 4: this technology came out a year ago, nobody has any
• 37:26
  Speaker 4: idea what it means. No, I'm gonna step up here,
• 37:29
  Speaker 4: chuck and say you should not be giving your minor
• 37:32
  Speaker 4: children access to a new piece of technology that everyone
• 37:37
  Speaker 4: seemingly understands the potential downsides of. It's true, like in
• 37:40
  Speaker 4: nineteen it's not like this is something that we have
• 37:43
  Speaker 4: no science fiction history about.
• 37:47
  Speaker 5: It's true.
• 37:47
  Speaker 2: In nineteen eighteen, you would have been like, hey, kid,
• 37:50
  Speaker 2: here's your first car.
• 37:51
  Speaker 4: Like you know, yeah, I'm willing to go out on
• 37:57
  Speaker 4: a limb on this one. Bad parenting if you're buying
• 38:00
  Speaker 4: this thing for your kids. Yeah, it's probably not a
• 38:03
  Speaker 4: perfect parent over here, but I have some guardrails in place.
• 38:07
  Speaker 5: So it's true. You probably don't want to buy a
• 38:10
  Speaker 5: completely untested technology toy for your kid, for your minor
• 38:15
  Speaker 5: child at age five.
• 38:16
  Speaker 3: You know.
• 38:16
  Speaker 4: It's like if you have a conversation with sixteen year
• 38:20
  Speaker 4: olds when we got there, all right, Yeah, it's I'm
• 38:22
  Speaker 4: a big believer.
• 38:23
  Speaker 5: Once you get into your teens, like you basically should
• 38:25
  Speaker 5: like let them figure out anything that they need to
• 38:28
  Speaker 5: because like they're going to be, you know, going out
• 38:30
  Speaker 5: of the house soon. But yeah, at age five, I
• 38:32
  Speaker 5: could see how maybe a hard no is is warranted
• 38:35
  Speaker 5: on this. That's that's that's fair. Let's take a quick
• 38:38
  Speaker 5: break for the rest of the day.
• 38:40
  Speaker 2: Dow was up two hundred and thirty points, S and
• 38:42
  Speaker 2: PS up eighty eight, NASDAG up five forty eight, stretching
• 38:45
  Speaker 2: its legs.
• 38:45
  Speaker 5: We'll stretch ours too, and we'll see you tomorrow.