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Is it too late to chase the bull market? · The Financial Exchange Show

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Speaker 2: Two on the Financial Exchange Chuck markin Tucker with you
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Speaker 2: and just a familiar story. The S and P five
1:16
Speaker 2: hundred gets to, you know, sixty one thirty, sixty one
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Speaker 2: forty and properly decides, Eh, water is a little cold
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Speaker 2: up here. I'm gonna head back down somewhere else. And
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Speaker 2: so we got markets selling off a little bit today
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Speaker 2: with the dawof five hundred eighty one points, the S
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Speaker 2: and P down fifty three, and the Nasdaq down one
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Speaker 2: hundred and eighty two. So about you know, one to
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Speaker 2: one to quarter percent pullback on your major US indices,
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Speaker 2: which continue just to chop in like a six percent
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Speaker 2: range since the election in November. So we're closing in
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Speaker 2: now on four months where this has been the case
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Speaker 2: where we we just have not been able to get
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Speaker 2: any momentum past that sixty one hundred mark on the
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Speaker 2: S and P five hundred, and likewise, we haven't like
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Speaker 2: falling apart or and I think it's just hanging out,
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Speaker 2: just kind of chopping along, not really going anywhere in
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Speaker 2: any hurry. And I think that is the continued story
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Speaker 2: until proven otherwise. Right now, tenure US Treasury is down
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Speaker 2: three basis points to four point five zero five percent
2:16
Speaker 2: oil West Text Intermediate up forty one cents a barrel
2:19
Speaker 2: to seventy two to sixty six TRIPAA national average for
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Speaker 2: gas prices up one tenth of a cent to three
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Speaker 2: sixteen and five tenths again normal seasonal shifts. You would
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Speaker 2: expect this number to get into that three thirty to
2:31
Speaker 2: three forty range over the next month or so, just
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Speaker 2: because of how refineries shift their blends of fuel and
2:38
Speaker 2: maintenance and this and that and everything. So you typically
2:40
Speaker 2: do see a little bit of a rise in the spring,
2:43
Speaker 2: it's not really due to anything other than you know,
2:45
Speaker 2: typical seasonality associated with gas prices. Finally, we've got gold
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Speaker 2: up nineteen dollars and twenty cents anounced to twenty nine
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Speaker 2: fifty five. Gold is still, you know, trying to find
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Speaker 2: a way to get above that three thousand mark, but
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Speaker 2: running into just a little bit of a bump here
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Speaker 2: over the last you know, few weeks as it tries
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Speaker 2: to do that. Still can't quite get to that mark.
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Speaker 2: But it's been a heck of a run over the
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Speaker 2: last year, with gold going from about two thousand per
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Speaker 2: ounce this time last year up to about twenty nine
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Speaker 2: hundred this year. You do the math that you're saying, Okay,
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Speaker 2: it's like forty seven percent move that you've seen upward
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Speaker 2: in it. So gold investors have been rewarded significantly over
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Speaker 2: the last year. Mark we got another one here for
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Speaker 2: a market watch. US stocks are back at record highs.
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Speaker 2: Is it too late to chase the bull market? Who
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Speaker 2: the heck knows? I have no idea. You know, no
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Speaker 2: one knows if it's too late to chase the bull market.
3:47
Speaker 2: And this is the thing about expensive markets is they
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Speaker 2: can stay expensive for quite a while. In the nineteen nineties,
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Speaker 2: Alan Greenspan had his famous irrational exuberance speech back in
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Speaker 2: nineteen ninety seven, right.
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Speaker 3: Uh, December of ninety six, ninety six, Yeah, I think
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Speaker 3: it was December of ninety six.
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Speaker 2: In that ballpark. The irrational exuberance persisted for four more
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Speaker 2: years until it finally broke down. And so, I don't know.
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Speaker 2: Everyone always likes to be like, Wow, what inning of
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Speaker 2: the rally are we in? No one knows. No one knows,
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Speaker 2: And it's because no one knows what's coming down the
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Speaker 2: road that might affect things in an unpredictable way. Sure,
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Speaker 2: if everything continued to move predictably. You could say, Okay, yeah,
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Speaker 2: this is what I would expect. But human beings are
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Speaker 2: not always predictable, you know, we're we kind of do
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Speaker 2: irrational thing sometimes, and so you know, is it too
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Speaker 2: late to chase the bull market? I don't know. I
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Speaker 2: have no idea what I can tell you. And this
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Speaker 2: is whenever I get asked these kinds of questions, I
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Speaker 2: come back to one one very simple principle, which is, look,
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Speaker 2: regardless of like where you've been to this point in
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Speaker 2: terms of how you've been invested, if you have expenses
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Speaker 2: that are coming up in the next few years and
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Speaker 2: that money is in the stock market, that money shouldn't
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Speaker 2: be anywhere near the stock market because you never know
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Speaker 2: when there's a fifteen, twenty twenty five percent dip that's coming.
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Speaker 2: And so if you've been saving money for a down
5:13
Speaker 2: payment on a house, or if you've been saving money
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Speaker 2: for college, or if you've been saving money for a car,
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Speaker 2: whatever it might be, and you happen to have done
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Speaker 2: pretty well in the market, man, it's like, don't look
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Speaker 2: at gift horse in the mouth, because it's just something
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Speaker 2: where you never know when things are going to fall apart,
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Speaker 2: And so the general principle is, look, if you've got
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Speaker 2: expenses that are you know, come and do in the
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Speaker 2: next one to three years, that money shouldn't be in
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Speaker 2: the market. I know it's going to be boring to
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Speaker 2: sit in a bank account and earn you know, three
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Speaker 2: percent a year or something like that, But ultimately that's
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Speaker 2: how I look at this as these times, you know,
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Speaker 2: they can be a reminder of, Hey, if I've done well,
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Speaker 2: maybe I think about, you know, should am I taking
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Speaker 2: too much risk? Given when my liabilities are coming due?
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Speaker 2: But as far as hey have us stocks? Is it
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Speaker 2: too eight to chase the bull market? There's no one
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Speaker 2: on earth your nose for sure.
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Speaker 3: Yeah, it's a really dumb headline and an equally dumb question.
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Speaker 2: I guess it gets clicks.
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Speaker 4: Yeah, it does, and.
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Speaker 3: We can't forget that's what they write these headlines for.
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Speaker 3: I think you already covered all the main points on
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Speaker 3: this topic. I'll just embellish a little bit on one point,
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Speaker 3: expand a little bit on one or state something differently whatever.
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Speaker 3: Big pullbacks are totally normal in equities, and you know,
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Speaker 3: fifteen to twenty percent swoons used to happen every two
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Speaker 3: or three years. That's in fact what you would expect
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Speaker 3: just due to forces of random chance. So you could
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Speaker 3: say we'd do it's been about three years. But to
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Speaker 3: the point you made earlier, whether you're talking about economic
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Speaker 3: expansions or bull markets, there's no relationship between their duration
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Speaker 3: and the probability that they're about to end. Sophisticated methods
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Speaker 3: have been employed to try to arrive at some sort
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Speaker 3: of relationship to do expansions get old in the tooth
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Speaker 3: And the answer is no, they don't appear to what
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Speaker 3: it What I think, excuse me long in the tooth park.
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Speaker 2: What I think you can say is high valuations do
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Speaker 2: represent the potential for more pain when oh yeah, oh
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Speaker 2: y issue comes. But you never know when. You never
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Speaker 2: know when that's going to be. And so you know,
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Speaker 2: I still remember when I when I first you know, started,
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Speaker 2: you know, getting into this business. I still remember it
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Speaker 2: was like twenty eleven or so, like somewhere in that
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Speaker 2: ballpark and the Dow Jones had just crossed. I want
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Speaker 2: to say, let me, I want to get the numbers right, Yeah,
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Speaker 2: it just crossed like thirteen thousand in twenty twelve, and
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Speaker 2: I was I was talking with someone and they're like,
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Speaker 2: I just I can't buy the Dow at thirteen thousand,
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Speaker 2: Like I'm gonna wait for it to pull back to
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Speaker 2: like ten or eleven again, and and then it's gonna
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Speaker 2: be time for me to invest. And hey, the Dow
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Speaker 2: never pulled back to ten or eleven again. It never
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Speaker 2: saw those numbers again. But also, like you think about it,
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Speaker 2: and hey, if you didn't want to invest at thirteen
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Speaker 2: thousand because the Dow was too high, well then it
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Speaker 2: went to fourteen and fifteen. It look, we're sitting here
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Speaker 2: now at forty four thousand, and sometimes I sit back
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Speaker 2: and I wonder, hey, those people who were nervous about,
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Speaker 2: you know, investing because the market was too high ten
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Speaker 2: years ago, did they ever invest? And again, I think
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Speaker 2: this is what I what I always come back to
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Speaker 2: in markets is look, the short term, you never know
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Speaker 2: what's coming in markets, and even in the long term,
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Speaker 2: if we're being completely intellectual, intellectually honest, you never know
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Speaker 2: what's coming in markets. But there's a long track record
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Speaker 2: of companies in the long run in the United States
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Speaker 2: being able to increase their earnings at a long term
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Speaker 2: compound annual growth rate of about six to seven percent
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Speaker 2: and if you look at that and say, look, regardless
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Speaker 2: of what happens in any one given year, month, heck,
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Speaker 2: even in a decade. I mean that the two thousands
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Speaker 2: were a horrible decade for stocks, and even despite that
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Speaker 2: bad decade, you still have seen long term returns be
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Speaker 2: very robust as far as US equities. Is that going
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Speaker 2: to continue forever? No, it's the there there is no
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Speaker 2: there's no law of physics that states that US equity
9:17
Speaker 2: markets have to return X, and so you could have
9:21
Speaker 2: at any point in time, but like the next two decades,
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Speaker 2: maybe you return nothing in US stocks. I don't know.
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Speaker 2: But ultimately for things for you to return really nothing
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Speaker 2: in US stocks, you have to think about, okay, over
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Speaker 2: a twenty year period, what has to change in order
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Speaker 2: for that to be the case. And there's some you know,
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Speaker 2: meaningful problems that would have to develop. It's not to
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Speaker 2: say it hasn't happened elsewhere. I mean again, even in
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Speaker 2: the US you've had decades where stocks have done nothing.
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Speaker 2: But that's why when we talk about investing in stocks,
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Speaker 2: you're not doing it for a week, a month, a year,
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Speaker 2: or even for a decade. You're talking about Yeah, I
9:56
Speaker 2: want to be investing in these for you know, twenty
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Speaker 2: thirty year periods, not the specific stock, but just the
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Speaker 2: idea of a broad basket of US stock.
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Speaker 3: Yeah, the structure of the economy would have to change
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Speaker 3: pretty dramatically. I'm not saying it couldn't. We've got politicians
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Speaker 3: talking about helping to set interest rates, i e. Depriving
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Speaker 3: the Fed of its independence, others who want to radically
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Speaker 3: restructure our social institutions, both from the left and the right.
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Speaker 3: The more change, no matter how necessary you think it is,
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Speaker 3: the more likely you are to kill the goose laying
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Speaker 3: the golden egg. So, you know, be careful what you have.
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Speaker 3: Not lecturing anybody, I'm not qualified to, and I'm not
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Speaker 3: saying anybody harbors these types of wishes, but be careful
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Speaker 3: how radical a change you wish for. Our present constellation
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Speaker 3: of of of institutions has made for an environment conducive
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Speaker 3: to a reasonably solid, solidly growing economy and strong stock returns.
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Speaker 2: You ever killed a goose? Mark, don't lie, don't.
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Speaker 3: I've never eaten a goose? Why would I under what circumstances?
10:57
Speaker 3: Like what one of those annoying Canadian geese that makes
10:59
Speaker 3: its way in my yard? I got it accusing me
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Speaker 3: of killing it.
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Speaker 2: No, I'm I'm well, we're talking about killing the golden goose.
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Speaker 3: Oh killing? Yeah, yeah, yeah, No, I have no experience
11:08
Speaker 3: of killing. I would not know how to do it. Well,
11:09
Speaker 3: you wring its neck, guy, as soon they got those
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Speaker 3: long necks, you just snap it.
11:13
Speaker 2: It's a big neck.
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Speaker 3: But yeah, it's pretty big target. You've never eaten goose,
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Speaker 3: I don't think so. Like, what is it called paste
11:20
Speaker 3: that the French make?
11:21
Speaker 2: Yeah, I'm not a fan of that, But like actual goose,
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Speaker 2: I enjoy.
11:27
Speaker 5: What's that I haven't had actual goose?
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Speaker 2: Actual goose is fantastic. Really, it is fantastic. But the yeah,
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Speaker 2: for grath, No, I I I just I don't. I
11:39
Speaker 2: don't enjoy a number of things about that, you know,
11:41
Speaker 2: the actual taste and texture of it. The idea that, hey,
11:44
Speaker 2: we made this because we basically force fed an animal
11:47
Speaker 2: to the point where it's inside started to break down
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Speaker 2: kind of problematic to me. Yeah, but that's neither here
11:54
Speaker 2: nor there. Let's take a quick break. When we come back,
11:57
Speaker 2: we'll do some trivia and then we'll talk ball. Right
12:00
Speaker 2: after this.
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14:08
Speaker 2: Mark we got a peace in the Financial Times as
14:10
Speaker 2: titled will the bond Market rain in? Donald Trump? And
14:14
Speaker 2: what it's talking about here is, Hey, if you were
14:17
Speaker 2: to see, you know, policies that are inflationary and actually
14:22
Speaker 2: like generating an inflationary impact implemented, it's the potential for
14:26
Speaker 2: the bond market to sell off, you know, not necessarily
14:29
Speaker 2: the same way it did in twenty twenty two, but obviously,
14:32
Speaker 2: anytime there's inflation in the idea is, hey, the Fed's
14:34
Speaker 2: gonna have to raise rates in order to stem it.
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Speaker 2: And so the question that's posed by this piece is, look,
14:41
Speaker 2: the ten years basically been sitting in a range of
14:43
Speaker 2: about four to four and a half percent for the
14:45
Speaker 2: last you know, six seven months now, and hey, if
14:49
Speaker 2: you were to see policies and acted that were inflationary,
14:52
Speaker 2: would you see the bond market sell off as a result?
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Speaker 2: And how much does that put additional pressure then on
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Speaker 2: the Trump administration in order to reverse ord modify those policies.
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Speaker 3: Uh, sure, it's possible. You don't know that policies are
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Speaker 3: going to be inflationary. Could that is constrain the economy's
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Speaker 3: ability to meet growing demand, That's another way to phrase it.
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Speaker 3: Until after the fact, tariffs could be inflationary or stagflationary.
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Speaker 3: They could act to slow growth and increase prices. As
15:23
Speaker 3: we talked about in the last hour. I don't see
15:25
Speaker 3: much in terms of indication in financial markets, using, for example,
15:31
Speaker 3: the break even inflation rate, which you can calculate using
15:34
Speaker 3: differences in yields among treasury bonds that aren't and are
15:38
Speaker 3: indexed for inflation. It's up a little bit since the election.
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Speaker 3: Not much though, not anything that would get your attention
15:45
Speaker 3: and ask, oh gee, what happened? But sure, Chuck, if
15:48
Speaker 3: the markets at some point think that, oh, I don't know,
15:52
Speaker 3: deficits are going to a spire a lot of control.
15:54
Speaker 3: That's my personal guess, by the way, So I can
15:58
Speaker 3: I can argue this with a little bit of uiasm
16:00
Speaker 3: if not any facts at my command yet because we
16:03
Speaker 3: simply don't know.
16:04
Speaker 4: But I think deficits will be.
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Speaker 3: Bigger one, two, three, and four years from now and
16:08
Speaker 3: eight years from now for that matter, if we stand
16:10
Speaker 3: in the current trajectory than they are today. All else
16:12
Speaker 3: sql that should put up with pressure on interest rates.
16:15
Speaker 3: Then there's the inflation component that you brought up, which
16:18
Speaker 3: could separately put pressure on interest rates.
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Speaker 2: In terms of in terms of how reactive this FED
16:29
Speaker 2: will be if there weren't increase in inflation. Do you
16:32
Speaker 2: have any you know, guidance based on kind of what
16:34
Speaker 2: they've seen historically and how they've behaved as to where
16:39
Speaker 2: the FED may start saying, hey, we need to hike
16:42
Speaker 2: rates again, like at what point did that become a
16:44
Speaker 2: concern for them?
16:45
Speaker 3: It hasn't happened much, thankfully, in the post Paul Voker,
16:50
Speaker 3: roughly nineteen seventy nine to present.
16:52
Speaker 2: Sure.
16:52
Speaker 3: The most recent test was two thousand and one. The
16:56
Speaker 3: FED diagnosed that as primarily a supply problem.
16:59
Speaker 2: Twenty one. What did I say, two thousand and one.
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Speaker 3: Yeah, twenty twenty one, thank you. The FED diagnosed that
17:05
Speaker 3: as a supply problem and hesitated to act delayed in
17:11
Speaker 3: hiking rates. I'm not sure it made that much of
17:14
Speaker 3: a difference. On the margin. It may have kept expectating
17:18
Speaker 3: inflation expectations high and delayed the disinflation process that we
17:22
Speaker 3: ultimately experienced. But the next shock, if you like, and
17:27
Speaker 3: it may not be a shock, It may just be
17:29
Speaker 3: uncomfortably high underlying inflation due to an economy that's running
17:33
Speaker 3: too hot. The FED has reacted in different ways to
17:36
Speaker 3: that in the last forty plus years. Forty or so
17:40
Speaker 3: years again, the post vulgar era. Green Span famously at
17:44
Speaker 3: times kept his powder dry, was willing to let things
17:46
Speaker 3: play out. The next FED chair, if it's not Powell,
17:50
Speaker 3: might with the experience of twenty twenty, twenty twenty one,
17:54
Speaker 3: twenty two in mind act a little bit more preemptively.
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Speaker 3: It's it's really hard to say, Chuck, will they act
18:01
Speaker 3: with resolutely, with conviction, and with a severe enough push
18:07
Speaker 3: against excess demand to staunch inflation? If it starts to rise, well,
18:13
Speaker 3: it's already elevated. If it resumes its just from currently
18:17
Speaker 3: elevated levels.
18:18
Speaker 2: Taking a look at markets as we head towards the
18:21
Speaker 2: bottom of the hour, the Dow is off five one
18:23
Speaker 2: hundred and ninety three points, the S and P down fifty,
18:26
Speaker 2: the NASDAC down one hundred and seventy three. So all
18:29
Speaker 2: three major usncies still down anywhere from about zero point
18:32
Speaker 2: eight percent to about one point three percent. Uh. If
18:35
Speaker 2: you look at the S and P, like, hey, where's
18:36
Speaker 2: the damage being concentrated? Walmart with you know, kind of
18:41
Speaker 2: a pretty meaningful loss on the day, down about six percent.
18:43
Speaker 2: You got Tesla and Amazon down two point three and
18:46
Speaker 2: one point six percent respectively. Uh, Mark, why why is
18:50
Speaker 2: every bank getting whacked today? What? What's going on in
18:54
Speaker 2: financials that is causing? Like, I haven't seen any news
18:57
Speaker 2: related to financials, but.
18:59
Speaker 4: Oh good, I thought it was a trick question. What
19:00
Speaker 4: does he expect me to know?
19:01
Speaker 3: Where's the story wire stocks down a percent. I mean,
19:06
Speaker 3: looking at the data.
19:07
Speaker 2: I don't know, like we we just put them through
19:09
Speaker 2: a random number generator and they went down and then
19:10
Speaker 2: we make.
19:11
Speaker 3: Stories after the fot It is just random.
19:13
Speaker 2: Yeah, but I'm trying to figure out why financials are
19:15
Speaker 2: selling off and I don't have anything. Rates are coming
19:18
Speaker 2: in notable, but I mean they're coming in, but most
19:22
Speaker 2: you know. Yeah, so you got financial selling off, healthcare
19:26
Speaker 2: is moving on up a little bit, and again overall,
19:30
Speaker 2: you got, you know, a modest sell off happening today.
19:32
Speaker 2: Nothing huge, nothing crazy, but a modest moved down. Quick break.
19:36
Speaker 2: When we return, we've got the trivia answer after this.
19:41
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20:14
Speaker 5: My tribute question today was how many teams did Charles
20:17
Speaker 5: Barkley play for during his NBA career.
20:21
Speaker 2: It'll be three.
20:22
Speaker 5: Started his career with the seventy six ers before being
20:25
Speaker 5: traded to the Suns, where he spent three years there
20:28
Speaker 5: before getting traded to the Rockets in nineteen ninety six.
20:33
Speaker 5: Winner today of the Financial Exshane Show t shirts Randy
20:36
Speaker 5: from east Ham, Mass. Congrats to Randy, and we play
20:39
Speaker 5: trivia every day here on the Financial Exchange. See complete
20:44
Speaker 5: contest rules at Financial Exchange Show dot com.
20:48
Speaker 2: Mark. We got some news from Microsoft yesterday.
20:52
Speaker 4: I saw that didn't wait to make it go ahead.
20:54
Speaker 2: They said they created a new state of matter to
20:58
Speaker 2: help with their quantum computing push as they revealed their
21:03
Speaker 2: first quantum computing chip. And this is where I'm fully in,
21:10
Speaker 2: like completely over my head. So this is what I've
21:14
Speaker 2: pieced together just from trying to understand what's going on.
21:18
Speaker 2: Quantum computing is the principle that normal computers operate with
21:24
Speaker 2: billions of transistors on different chips. And a transistor is
21:27
Speaker 2: simply something that is either a one or a zero.
21:29
Speaker 2: It's binary, it's open or it's closed. And basically, in
21:32
Speaker 2: order to do you know complex things, you have to
21:35
Speaker 2: cycle through you know different permutations of which ones are open,
21:38
Speaker 2: which ones are closed. Millions and millions of times, this
21:40
Speaker 2: all happens every second, millions of times. Great quantum computing.
21:45
Speaker 2: Is hey, a quantum transistor or a cubit as you
21:49
Speaker 2: can call it can be both a zero and one
21:51
Speaker 2: at the same time. It's kind of like you've got
21:54
Speaker 2: your feet in a cold tub and your head is like,
22:00
Speaker 2: I don't know, like next to the oven. Like you're
22:02
Speaker 2: hot and cold at the same time. You're not quite
22:03
Speaker 2: sure what to feel, but you're feeling both of them.
22:06
Speaker 2: So Microsoft is they say they created a chip that
22:10
Speaker 2: uses this new state of matter to help build quantum computers.
22:18
Speaker 2: And it uses what they are calling a topological superconductor,
22:23
Speaker 2: a topological superconductor, it's not a solid liquid or gas,
22:29
Speaker 2: in order to produce this chip that can be scaled
22:33
Speaker 2: up into a quantum computer. They've named this chip the
22:38
Speaker 2: Madurana one. And Madurana if you're not familiar with him,
22:41
Speaker 2: which I wasn't before today, so you know, it's it's
22:44
Speaker 2: not something where I had any idea what was going
22:46
Speaker 2: on here. But he was an Italian theoretical physicist who
22:52
Speaker 2: lived in the first half of the twentieth century, like
22:55
Speaker 2: nineteen oh six through like nineteen sixty. No one's quite
22:57
Speaker 2: sure when he died. His death was a want to event,
23:00
Speaker 2: I guess I don't know, but in any case, so
23:04
Speaker 2: they name this after him because he had, you know,
23:06
Speaker 2: come up with these different theories about you know, different
23:09
Speaker 2: substances in YadA YadA, and so it's it's named after
23:13
Speaker 2: like the particle that he thought might exist, that they
23:15
Speaker 2: think might have they might have created, called Madurana fermions fermians.
23:25
Speaker 2: That's right. We're dealing with this right now. And just
23:30
Speaker 2: to tell you what Wikipedia says about this, because again
23:33
Speaker 2: I have no idea what I'm talking about here. In
23:36
Speaker 2: particle particle physics, a magarana fermion or majarana particle is
23:42
Speaker 2: a fermion that is also its own anti particle. A
23:48
Speaker 2: margarana fermion is a fermion that is also its own
23:52
Speaker 2: anti particle. So basically they're saying that like it can
23:57
Speaker 2: like annihilate itself somehow I don't really know, but somehow
24:00
Speaker 2: they're you know, Microsoft is saying that we made something
24:03
Speaker 2: like this to help with our quantum computer. What I
24:06
Speaker 2: still don't understand about quantum computers is why they are
24:09
Speaker 2: just they look like these like chandeliers for some reason
24:13
Speaker 2: that are all made out of like gold and then
24:15
Speaker 2: clear wiring. I don't know, but again I'm sure there's
24:18
Speaker 2: something there. But continuing to get you know, more drip
24:21
Speaker 2: rip drip about quantum computing. The big thing is that
24:28
Speaker 2: this is still like very early on. This chip they
24:31
Speaker 2: developed has eight cubits, and they're saying that in order
24:34
Speaker 2: to get this like useful for like real you know,
24:37
Speaker 2: improved computing capacity, you need to be able to build
24:41
Speaker 2: chips with like a million cubits. So they're they're little
24:43
Speaker 2: ways away given that they've made one with eight. But again,
24:48
Speaker 2: kind of some interesting news and Majorana Fermian's mark.
24:52
Speaker 4: Yeah, this is exciting.
24:53
Speaker 3: You know, what I'd like from Microsoft is a version
24:55
Speaker 3: of power Point that doesn't require that I form at
24:58
Speaker 3: every single slide when I want them identically, that I
25:02
Speaker 3: have to do them individually. Can we start there with
25:05
Speaker 3: a little animated clippy that's actually helpful.
25:09
Speaker 2: The theory of Magarana's Fermians goes back to his suggestion
25:13
Speaker 2: in nineteen thirty seven that electrically neutral spin one half
25:17
Speaker 2: particles can be described by a real valued wave equation
25:21
Speaker 2: and would therefore be identical to their antiparticle because the
25:24
Speaker 2: wave functions of the particle and anti particle are related.
25:27
Speaker 2: By complex conjugation.
25:30
Speaker 3: I want Microsoft Word to stop suggesting superfluous words when
25:34
Speaker 3: I know what I want to say.
25:36
Speaker 4: That's what I want out of office. Chuck you care.
25:38
Speaker 4: I don't know how many Fermians that's what.
25:40
Speaker 2: You want that you get a Fermion.
25:42
Speaker 3: I don't care how many damn Fermians it takes to
25:44
Speaker 3: make that happen.
25:45
Speaker 4: I will Microsoft.
25:46
Speaker 3: I want the Microsoft Office Suite to be slightly easier
25:49
Speaker 3: to use than it was in nineteen ninety six.
25:50
Speaker 2: You will get Fermians and you will like them.
25:53
Speaker 5: M I just picture like somebody like Chris Farley speaking
25:57
Speaker 5: on behalf of Microsoft being like, what I'm trying to
25:59
Speaker 5: tell is our quantum computers are really cool.
26:04
Speaker 2: Yeah, you want Fermians. We've got the Fermians.
26:07
Speaker 4: But Chuck doesn't it.
26:08
Speaker 2: This is if you want a million, two million.
26:10
Speaker 3: For someone that doesn't have a PhD in physics or
26:13
Speaker 3: what like, this is an undergraduate Maybe this is undergraduate physics.
26:16
Speaker 3: If you're a major, you certainly don't g this in
26:18
Speaker 3: the survey course.
26:19
Speaker 2: This isn't undergrad physics. I just got this guy died
26:22
Speaker 2: and they never even knew these existed.
26:25
Speaker 3: Yeah, that that's a little weird and creepy too. But
26:27
Speaker 3: even nobody knows when he died. This whole story's got
26:30
Speaker 3: suspicious elements to it.
26:31
Speaker 2: It's a March. In March twenty fifth, nineteen thirty eight,
26:35
Speaker 2: he disappeared under mysterious circumstances after purchasing a ticket to
26:38
Speaker 2: travel by ship from Naples to Palermo.
26:40
Speaker 3: He slipped into the uh Tron computer. He's in the
26:44
Speaker 3: light cycles.
26:45
Speaker 2: He's in the quantum realm.
26:47
Speaker 3: Yeah yeah, yeah again. I just want PowerPoint to take
26:51
Speaker 3: I want it to take less than an hour to
26:52
Speaker 3: format a PowerPoint presentation respectably.
26:55
Speaker 2: We'll we'll have a team of that.
26:58
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28:16
Speaker 2: So also, this guy's uncle was a physicist too. I'm sorry,
28:20
Speaker 2: but this is just wild that this is all in
28:22
Speaker 2: one family.
28:23
Speaker 4: Yeah, do we know if he died?
28:25
Speaker 2: He did on July thirty first, nineteen fifty seven. His
28:28
Speaker 2: name was Quirino Francesco Valentino Majorana, and he performed This
28:35
Speaker 2: is all Wikipedia, so I'm you know, take it for
28:39
Speaker 2: what it's worth. He performed a long series of very
28:42
Speaker 2: sensitive gravity shielding experiments gravity shielding. His experiments determined that
28:49
Speaker 2: mercury or lead around a suspended lead sphere acted as
28:54
Speaker 2: a screen and slightly decreased the Earth's gravitational pull. So
28:58
Speaker 2: he thought that you could reduce gravity using lead.
29:01
Speaker 3: Yeah, then somebody told him there's no use for that node.
29:05
Speaker 2: To reproduce his results using the same experimental techniques, other
29:08
Speaker 2: researchers have concluded it from other data that if gravitational
29:11
Speaker 2: absorption does exist, it must be at least five orders
29:13
Speaker 2: of magnitude smaller than his experiments suggest. He also was
29:18
Speaker 2: critical of Albert Einstein's theory of relativity and tried to
29:21
Speaker 2: disprove it, and he failed, and therefore his experiments actually
29:25
Speaker 2: proved Einstein's postulate. This is wild.
29:30
Speaker 3: Yeah, now I'm starting to think Elon Musk is onto
29:32
Speaker 3: something firing all these researchers.
29:36
Speaker 2: How do how do we get this guy to work
29:37
Speaker 2: for us?
29:39
Speaker 3: What would prompt you to want to I'll just call
29:42
Speaker 3: it cancel to neutralize gravity?
29:46
Speaker 2: Aside from everything.
29:48
Speaker 4: Maybe there are experience, there are experiments.
29:49
Speaker 2: Okay, you don't think anti gravity would be useful?
29:52
Speaker 3: I guess if there are experiments you want to do
29:54
Speaker 3: in a gravity lists environment, this would be helpful.
29:58
Speaker 4: It would be so.
29:59
Speaker 3: I obviously speak a position of huge ignorance more so
30:02
Speaker 3: than usual here, but I.
30:04
Speaker 2: Think of it much more from the perspective. Think about
30:06
Speaker 2: what you could do for air travel if you didn't
30:08
Speaker 2: have to deal with gravity, because most of the most
30:11
Speaker 2: of the fuel that you consume an air travel is
30:13
Speaker 2: related to keeping the plane or the helicopter, you know,
30:16
Speaker 2: in the air. If you didn't have to do that,
30:19
Speaker 2: and all you had to do is move forward and backwards,
30:22
Speaker 2: it's kind of a big deal. I stand corrected, you know,
30:25
Speaker 2: like the Jetson's probably have lots of Fermians.
30:29
Speaker 3: How do we know this story is not complete?
30:30
Speaker 4: Blooney?
30:31
Speaker 2: Which one the micro interest? Excuse me, oh, the Microsoft one.
30:34
Speaker 3: I have no idea how our perspective investors or existing
30:37
Speaker 3: investors supposed to internalize this. What are we supposed to
30:41
Speaker 3: make of it? And when does this become operational?
30:43
Speaker 4: Is it a decade?
30:44
Speaker 3: Is it a century from now? I'm if they're pursuing it,
30:47
Speaker 3: if they're putting capital into it, presumably they think it's
30:50
Speaker 3: got some it's got an application within a reasonable timeframe
30:54
Speaker 3: five to ten years. But it's really hard to make
30:56
Speaker 3: heather tail out of stories like this, and we see them,
31:00
Speaker 3: I don't know, once every couple of weeks, maybe about
31:02
Speaker 3: some unfamiliar technology that honestly you need a PhD to interpret.
31:06
Speaker 2: Yeah, it's tough to make any sense of this and
31:09
Speaker 2: whether it is in any way investable, useful, or just hey,
31:13
Speaker 2: we're generating a story because the AI thing's fizzling out
31:16
Speaker 2: and so we're, you know, trying to turn the sits
31:19
Speaker 2: to quantum computing.
31:20
Speaker 3: Yeah. I put AI in the same sort of category
31:22
Speaker 3: of uh maybe, but no one writing about this or
31:26
Speaker 3: commenting on in the media has enough expertise to distinguish
31:29
Speaker 3: BS from sort of something that's credible and operationally feasible.
31:34
Speaker 2: No, I'm I'm just happy that, you know. Later today,
31:37
Speaker 2: I'm going to go and spend some time with the
31:39
Speaker 2: Fermians and we'll have a good time. Let's take a
31:42
Speaker 2: quick break. When we come back, we'll do a little
31:44
Speaker 2: bit of stack roulette.
31:47
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32:51
Speaker 2: Mark. What do you got for me? For stack? Roulax,
32:54
Speaker 2: Chuck and folks.
32:55
Speaker 3: If you're thinking about cheating on your taxes, this might
32:58
Speaker 3: be the year to do it. The IRS starts laying
33:01
Speaker 3: off employees today. It'll start with about six thousand that's
33:04
Speaker 3: less than ten percent of its eighty three thousand person workforce,
33:08
Speaker 3: but presumably, though they don't say, some of those hired
33:13
Speaker 3: in the past couple of years, and that's who were
33:14
Speaker 3: being targeted. Of course, were part of the previous administrations.
33:18
Speaker 3: The prior administration's efforts to step up enforcement, which historically,
33:22
Speaker 3: by the way, has been money well spent. For every
33:24
Speaker 3: I don't know dollar the IRS spends, they typically recoup
33:29
Speaker 3: several in step.
33:30
Speaker 2: The testaments that I've seen is for taxpayers in the
33:33
Speaker 2: bottom ninety nine percent of taxpayers, it's every dollar of
33:37
Speaker 2: enforcement returns five dollars in revenue, and for those in
33:40
Speaker 2: the top one percent, every dollar of enforcement returns twelve
33:43
Speaker 2: dollars in revenue.
33:45
Speaker 3: Yes, I'm I have mixed feelings about a story like
33:48
Speaker 3: this because to me, the best margin, the best income
33:51
Speaker 3: tax rate, would be zero. I don't like it.
33:53
Speaker 4: I wish we taxed consumption.
33:54
Speaker 3: That's just my personal predilection, means nothing, just my personal
33:58
Speaker 3: two cents. While we sure, in theory hamstringing the IRS
34:04
Speaker 3: by depriving it of enforcement resources, that people who like
34:09
Speaker 3: me don't like the income tax might cheer that. But
34:11
Speaker 3: then I realized that, well, sure, then the next administration
34:14
Speaker 3: is just going to beef it up again. You need
34:16
Speaker 3: to change If you don't like taxes, you need to
34:18
Speaker 3: change the law. You don't dull enforcement because that can
34:22
Speaker 3: always be reversed. Plus, it seems shortsighted at a time
34:25
Speaker 3: that we're trying to close the budget gap. But whatever,
34:29
Speaker 3: my two cents, the IRS is starting substantial layoffs today.
34:36
Speaker 2: Delta offering thirty thousand dollars to passengers on the plane
34:40
Speaker 2: that crashed at Toronto Pearson International Airport on Tuesday. And
34:47
Speaker 2: I gotta tell you, if I was on that plane,
34:49
Speaker 2: I'd be holding out for more than thirty thousand. Yeah,
34:52
Speaker 2: like it is remarkable. Well, yeah, it's remarkable that no
34:55
Speaker 2: one died on that plane. But yeah, so you ended
34:59
Speaker 2: up with seventy six passengers and four crew members, all survived.
35:02
Speaker 2: Twenty one passengers were taken to the hospital. All but
35:05
Speaker 2: one have now been released. So again, just remarkable at
35:08
Speaker 2: this point that that was not worse. But I gotta
35:13
Speaker 2: tell you that Delta is also saying, look, this won't
35:15
Speaker 2: preclude you from, you know, filing a lawsuit or anything.
35:18
Speaker 2: But I gotta tell you, if if I went through that,
35:21
Speaker 2: I need more than that in order to uh, to
35:25
Speaker 2: move on from that kind of experience. It's just my person.
35:31
Speaker 2: If they're offering this two days after it happened, you know,
35:35
Speaker 2: it's it's like, okay, they know it's not good, and
35:40
Speaker 2: you know, we'll have to see exactly what ends up
35:42
Speaker 2: coming of this. But obviously, uh, this thing, I would
35:46
Speaker 2: be looking for more. That's that. That's all I'm saying,
35:49
Speaker 2: if if if I had to go through that on
35:52
Speaker 2: a flight, And again, still remarkable to me that that
35:55
Speaker 2: there were no casualties as a result.
35:57
Speaker 3: Now that you you said, they won't force them to
35:59
Speaker 3: sign some sort of liability waiver.
36:02
Speaker 2: Or no, and so similar Now, similar thing was back
36:07
Speaker 2: in twenty thirteen, there's an Asiana Airlines flight that made
36:11
Speaker 2: a similar offer, and this was for a ten thousand
36:15
Speaker 2: dollars payment, and so that the pick didn't preclude them
36:19
Speaker 2: from filing lawsuits, and they ended up with dozens of
36:21
Speaker 2: lawsuits filed and a bunch of confidential settlements, it sounds
36:25
Speaker 2: like as well as a result of it. So yeah,
36:30
Speaker 2: this this one was just not good.
36:33
Speaker 4: So doesn't bind anybody to anything.
36:35
Speaker 3: Why would you take the offer or why would you
36:37
Speaker 3: excuse me if it didn't, as you say, preclude you
36:39
Speaker 3: from from filing acclaim or being part of a class action.
36:43
Speaker 3: Why wouldn't you take the offer and then just sue
36:46
Speaker 3: them the next day. Why would they make the offer?
36:49
Speaker 2: Asked differently, Well, I think they're making it to try to,
36:53
Speaker 2: you know, get some people to not you know, sue obviously,
36:56
Speaker 2: but again, just like that for this particular episode, it
37:01
Speaker 2: seems light.
37:03
Speaker 3: Yeah, it's like free peanuts for life or something that's
37:05
Speaker 3: that's not gonna do it, you know.
37:07
Speaker 2: Yeah, it's how do you like a pillow? Pillow sounds nice? Yeah,
37:15
Speaker 2: throw a pillow? Will sign? What else you got?
37:17
Speaker 4: Mark uh Welt, Chuck, let's see here, Jee, what what
37:24
Speaker 4: did you?
37:24
Speaker 2: What do you? I?
37:26
Speaker 3: Actually I was drawn to the Delta story, to be
37:29
Speaker 3: fully honest. What's on your mind, Chuck Zada?
37:33
Speaker 2: What do you think about the Trump administration talking about
37:35
Speaker 2: getting rid of the penny?
37:37
Speaker 3: I think that and the nickel for that matter as well,
37:41
Speaker 3: some have estimated would be cost effective to to do
37:43
Speaker 3: away with. Are there any strong defenders of the penny?
37:47
Speaker 3: Is there like a Lincoln advocacy group out there that's
37:51
Speaker 3: deeply offended by it, or people that like the American
37:53
Speaker 3: Buffalo that don't want to see the nickel eradicated? Like
37:57
Speaker 3: there's there's no interest group lobbying to preserve these things.
38:00
Speaker 2: No, the penny cost the US mint two point seven
38:04
Speaker 2: cents per coin after accounting for its value, the nickel
38:08
Speaker 2: eight point eight cents per coin. So ideally, you know,
38:11
Speaker 2: both of those kind of problematic. But yeah, when you
38:14
Speaker 2: consider how many were minted, it still resulted in one
38:17
Speaker 2: hundred million dollar net loss for the federal government. Not
38:19
Speaker 2: not really the biggest issue we're facing. Quick break here,
38:22
Speaker 2: we got actually long break here. We're back tomorrow on
38:25
Speaker 2: the Financial Exchange