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Nike has a long way to run to achieve the comeback · The Financial Exchange Show

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Speaker 2: Chuck, Mike and Tucker with you here as we try
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Speaker 2: to finish out the week. Well, we're gonna finish out
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Speaker 2: the week, I mean, god willing.
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Speaker 3: Yeah, we don't really have to try that hard.
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Speaker 4: A question of whether or not we can put on
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Speaker 4: a good show and figure finish up the week. The
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Speaker 2: I see where we're at and everything, and it's it's
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Speaker 2: but you're not going to walk out being like, Wow,
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Speaker 2: best thing I've ever seen. So I know you gotta
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Speaker 2: be honest with the people. Mike, you know some days,
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Speaker 2: Pedro Martinez one of my favorite quotes from me. You know,
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Speaker 2: you used to talk about being a pitcher in Major
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Speaker 2: League Baseball and say, look, you get thirty times a
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Speaker 2: year that you're gonna be on the bump, you know,
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Speaker 2: ready to go, And he said, twenty of those you're
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Speaker 2: gonna be just fine. You'll have your stuff and you'll
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Speaker 2: be Okay. Five of them, something's gonna click and you're
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Speaker 2: gonna be like, potentially ready to throw a no hitter,
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Speaker 2: and five of them you're gonna have nothing, and you
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Speaker 2: gotta figure out how to get through. This is one
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Speaker 2: of those twenty games where it's gonna be fine, you're
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Speaker 2: gonna be entertained byas, but it's not gonna be the
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Speaker 2: best show we ever did see.
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Speaker 4: I would argue that this is gonna be the single
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Speaker 4: best show about airport fires that we've ever done.
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Speaker 2: It's true because London Heathrow is closed today, not like
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Speaker 2: just hey, you know, things are operating at reduced capacity.
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Speaker 2: They have told people do not show up before eleven
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Speaker 2: fifty nine pm tonight because we are not open.
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Speaker 3: No big deal.
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Speaker 4: It's only the busiest airport in Europe. Not a big
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Speaker 4: deal at all, fourth busiest in the world.
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Speaker 2: Yes, it's it is just a major, major hub for
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Speaker 2: any kind of international travel. And so you're gonna have
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Speaker 2: thirteen hundred flights either canceled or rerouted today. And the
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Speaker 2: big thing is, look, this is predominantly going to affect
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Speaker 2: European airlines. Sure, obviously you have, you know, US airlines
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Speaker 2: that fly over there as well, but the number of
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Speaker 2: flights is a fraction of what you know they're flying
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Speaker 2: domestically in the US, and a fraction of that total
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Speaker 2: thirteen hundred flights that are being affected there. Look, British
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Speaker 2: Airways alone is responsible for six hundred and seventy seven
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Speaker 2: of the flights that are canceled, so half of them
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Speaker 2: are just from one airline. And basically what's happened we
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Speaker 2: don't know all the details yet, but there is a
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Speaker 2: power substation nearby that apparently had some kind of catastrophic fire.
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Speaker 2: We don't know any details about how, why, or you
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Speaker 2: know exactly what happened, but basically it was bad enough
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Speaker 2: that even the backup generators for the airport, I don't
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Speaker 2: know if they were damaged because they're in a similar location,
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Speaker 2: which would seem to be a bad spot for a
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Speaker 2: backup generator. You probably don't want to put it right
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Speaker 2: next to your primary power. But the counter to that
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Speaker 2: on one level is, hey, all of the wiring is
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Speaker 2: already there, so you don't have to truly duplicate it.
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Speaker 2: But you know, generally you want your backups to be
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Speaker 2: somewhere else, but I don't know where they are. And
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Speaker 2: so the airport has been without power for the better
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Speaker 2: part of several hours now and they're saying, you know,
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Speaker 2: they're hoping to resolve it before the end of the day.
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Speaker 2: But the thing about airports, from what I gather, you
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Speaker 2: don't just walk up to the side of the airport,
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Speaker 2: push the reset button and have everything come back on
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Speaker 2: exactly as it was. And this is before you even
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Speaker 2: get into Gee there's you know, again, if you get
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Speaker 2: thirteen hundred flights being canceled, probably somewhere in the ballpark
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Speaker 2: of one hundred and fifty to one hundred and eighty
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Speaker 2: thousand people that are going to be disrupted as a
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Speaker 2: result of it, and the chaos that ensues where mostly
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Speaker 2: British airways is like how do we get your rebooked
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Speaker 2: or how do we compensate you for whatever has happened?
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Speaker 2: And so you've got some stuff to work through, some stuff.
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Speaker 3: Yeah.
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Speaker 4: So so that's what's going on in London right now.
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Speaker 4: And if you are planning to fly to Europe you
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Speaker 4: might already be delayed.
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Speaker 2: Yes, so there's that. After the bell yesterday we had
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Speaker 2: FedEx report their earnings and for the fiscal year, they
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Speaker 2: are guiding lower in a range of eighteen to eighteen
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Speaker 2: sixty a share, below the eighteen ninety five average analyst estimate.
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Speaker 2: They also think that revenue might be slightly down versus
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Speaker 2: the prior year as well. This goes against previous guidance
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Speaker 2: that thought sales would be flat. As a result, the
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Speaker 2: shares opened down around ten percent in trading today, and
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Speaker 2: at one point I saw that they had fallen yeah,
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Speaker 2: about twelve percent, So, you know, just pretty choppy for FedEx.
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Speaker 2: And in terms of trying to you know, figure out,
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Speaker 2: you know, where the weakness is, they are saying it
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Speaker 2: is predominantly their industrial customers that are showing weakness right now.
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Speaker 2: And this gets it one of the things we talked about,
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Speaker 2: which is, hey, if you're not sure about where your
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Speaker 2: business is going to be going, you may pull back
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Speaker 2: on some projects and spending and things like that. And certainly,
6:12
Speaker 2: look if you're talking about like shipping stuff. You know, again,
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Speaker 2: I know that a lot of times we think of
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Speaker 2: FedEx is just delivering Amazon packages, but they.
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Speaker 3: Do a lot more believe than that.
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Speaker 2: Yeah, they do some pretty heavy duty stuff for you know,
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Speaker 2: high end, big customers that need you know, big stuff
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Speaker 2: shipped around the country, and so there's some questions on
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Speaker 2: that side of things.
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Speaker 4: I have to say, I am I'm not surprised that
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Speaker 4: FedEx would predict problems to their business based on trade escalation, right,
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Speaker 4: that's no wholly unsurprising that you would, you know, take
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Speaker 4: a hit to your business and your industrial customers if
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Speaker 4: it suddenly costs a lot more to bring products in
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Speaker 4: from other countries, or frankly, even if it doesn't cost more,
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Speaker 4: but you're just unsure of what it's going to cost,
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Speaker 4: then you might delay in order. The story over the
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Speaker 4: last few months, though, has been not that chuck. It's
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Speaker 4: been and hey, we need to get ahead of these
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Speaker 4: tariffs and so get all the stuff that we might
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Speaker 4: want into our country as quickly as possible. And in
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Speaker 4: spite of that, FedEx is saying for the third consecutive
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Speaker 4: quarter that we are going to lower our full year guidance.
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Speaker 4: And so again, lowering guidance is not the same thing
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Speaker 4: as reporting actual drops in sales, but they're doing both
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Speaker 4: here and I find that intriguing at the moment that
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Speaker 4: this might be if these tariffs should play out the
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Speaker 4: way that FedEx is worried this could be one of
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Speaker 4: the better quarters that they were actually able to report,
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Speaker 4: and those future results could be rather disappointing as well.
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Speaker 2: Yeah, so you've got them with a disappointing quarter. Nike also,
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Speaker 2: quite honestly, is in I think the technical term is
7:42
Speaker 2: deep doodo is the one that's out there. I have
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Speaker 2: no idea on. Granted, they have a new CEO who
7:48
Speaker 2: came on board. Was it in the last quarter or
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Speaker 2: two October? Yeah, it was October. Yeah, So they have
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Speaker 2: a new CEO who came on board, but they seem
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Speaker 2: to be absolutely lost as far as where they are
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Speaker 2: trying to go with their business. They're guiding down on sales,
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Speaker 2: they're guiding down on margins. Basically, the whole business looks
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Speaker 2: to be in a pretty ugly spot right now. And
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Speaker 2: it's kind of fascinating to me because you talk about
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Speaker 2: companies and the value of their brand, and historically, one
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Speaker 2: of the things that you know has been true as
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Speaker 2: long as I've been alive at least, is in any
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Speaker 2: of the surveys out there, like the Nike logo in
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Speaker 2: the brand is it's like one of the most recognizable
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Speaker 2: symbols out there and one of the most powerful marketing
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Speaker 2: symbols out there, and it just doesn't seem to be
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Speaker 2: doing anything because they are really struggling when it comes
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Speaker 2: to being able to actually move product successfully.
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Speaker 4: Yeah, there's been a few things on Nike's business over
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Speaker 4: the course of the last few years that have just
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Speaker 4: been all over the place.
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Speaker 3: You know.
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Speaker 4: During COVID, they basically ended a bunch of their partnerships
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Speaker 4: with third party retailers and said, if we're gonna sell
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Speaker 4: our sh is, we're going to sell our shoes. And
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Speaker 4: so they I believe, pulled them both from brick and
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Speaker 4: mortar as well as online retailers and said you want
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Speaker 4: to buy Nike stuff, come get it from us.
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Speaker 3: That turned out to be a terrible idea.
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Speaker 2: Didn't work, didn't work at all.
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Speaker 4: Okay, it turns out, you know, Nike, you are not
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Speaker 4: important enough for me to go there instead of shopping
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Speaker 4: on Amazon or at foot Locker or any of those places.
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Speaker 4: And so they had to reverse course in terms of,
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Speaker 4: you know, sports partnerships and sponsorships and things like that.
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Speaker 4: I'm not sure if they've missed the ball on that
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Speaker 4: fronts as much as as much has been the issue,
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Speaker 4: but I do wonder just in this new age of
9:40
Speaker 4: like social media and the pace at which new companies
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Speaker 4: are able to produce sales online. I just think about
9:46
Speaker 4: all of the like fashion sneaker brands that have been
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Speaker 4: coming out of the last few years, out of seeming
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Speaker 4: nowhere to compete with Nike and gaining traction quickly. Nike's
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Speaker 4: old tools of just you know, mainstream TV average tizing,
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Speaker 4: for example, might just not be the best approach that
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Speaker 4: they can deal with right now. You think about, you know,
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Speaker 4: on running and what's the what are some of these
10:10
Speaker 4: jubbers all birds? Okay? Yeah, all of these companies A
10:14
Speaker 4: six and you know do balance. If you do one
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Speaker 4: Google search for like fashion sneakers, then all of a sudden,
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Speaker 4: your entire Facebook feed and everything else is just scattered
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Speaker 4: with all sorts of very inexpensive brands. And today people
10:30
Speaker 4: are more willing to take a bet on that or
10:33
Speaker 4: rely on a Facebook suggestion than they were in decades
10:36
Speaker 4: past when you'd say, you know, I don't know what
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Speaker 4: this brand is, how they what they do, or if
10:41
Speaker 4: the shoes any good, I'm gonna go and go to
10:44
Speaker 4: the old stalwart Nike.
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Speaker 2: Let's take a quick break here. When we come back
10:47
Speaker 2: We've gotten a lot of a lot of different consumer
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Speaker 2: earnings this week. I want to kind of look at
10:52
Speaker 2: them in the in their totality and say, hey, what
10:56
Speaker 2: are we hearing from companies about how spending is progressing.
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Speaker 2: We'll talk about that when we return.
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12:24
Speaker 2: I want to talk a little bit about some of
12:26
Speaker 2: the earnings that we've gotten from consumer companies this week,
12:30
Speaker 2: just in the sense of, like, what are they telling
12:32
Speaker 2: us about where consumer spending is, since that's such a
12:36
Speaker 2: big driver of the economy. And I'll start with the
12:39
Speaker 2: ones that we got yesterday, which were Nike, which obviously
12:43
Speaker 2: was bad, and FedEx, which didn't really indicate much slow
12:49
Speaker 2: down in their consumer business, but their corporate and industrial
12:51
Speaker 2: stuff is kind of lackluster right now. Sure other ones
12:55
Speaker 2: that we've seen in the last week or two. Delta
12:57
Speaker 2: came out last week and said, hey, we've seen a
12:58
Speaker 2: definite drop in bookings. That is, you know, potentially problematic
13:04
Speaker 2: if it continues.
13:05
Speaker 4: Interesting stuff on Delta, though they're higher end bookings. International
13:09
Speaker 4: for example, Holding up quite well.
13:11
Speaker 2: Yeah, so kind of a mixed bag.
13:13
Speaker 3: Yeah.
13:14
Speaker 2: Carnival Cruise Lines came out yesterday said hey, we're seeing
13:17
Speaker 2: all kinds of crazy demand, no problems here at all. Okay,
13:22
Speaker 2: it's kind of interesting. Williams Sonoma was either yesterday or
13:25
Speaker 2: the day before Williams Sonoma. High end, you know, home
13:30
Speaker 2: products and things like that. You know, you think dishes
13:33
Speaker 2: and spatulas more expensive than spatulas, but I'm sure they
13:37
Speaker 2: have this.
13:38
Speaker 3: We have a giant wooden spoon from them.
13:40
Speaker 2: Yeah, you know, think of like you know, place match
13:44
Speaker 2: kinds of stuff. Yeah, great, great towels, you know, legendary.
13:47
Speaker 2: They said, hey, everything looks great here, no problem. Darden
13:51
Speaker 2: Restaurants mixed bag where they said, look the high end
13:55
Speaker 2: stuff that we have where we've got capital grill and
13:59
Speaker 2: things like that, we're seeing no slowdown. Everything looks good there.
14:02
Speaker 2: The rest of our portfolio kind of not doing so well.
14:06
Speaker 3: And let's go starting to spell out a bit of
14:08
Speaker 3: a story.
14:08
Speaker 2: I think that the story that we're seeing so far
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Speaker 2: on the consumer spending side of things is high income
14:16
Speaker 2: and high spenders not really adjusting too much.
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Speaker 3: Of the moment.
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Speaker 2: The lower income portions of the population seem to be
14:26
Speaker 2: pulling back in a fairly meaningful way right now. And Nike,
14:29
Speaker 2: I don't really attribute to any of this nig I
14:31
Speaker 2: just think they're not execution. I think they just have
14:33
Speaker 2: execution problems there. So I think that we get back
14:36
Speaker 2: to this idea of and this has been the case
14:39
Speaker 2: for again the last five years. I remember coming out
14:43
Speaker 2: of you know, the COVID stuff in twenty twenty, and
14:46
Speaker 2: there was this idea of this K shaped recession where
14:49
Speaker 2: those on the high end of the income spectrum we're
14:51
Speaker 2: doing well, the ones on the low end are not.
14:54
Speaker 2: It's kind of being exacerbated right now. And I feel
14:57
Speaker 2: like that's a continuation of that story we're seeing here,
15:00
Speaker 2: and I.
15:01
Speaker 4: Want to try and figured that one out here, Chuck like,
15:04
Speaker 4: why why now? I guess is part of my question. Certainly,
15:08
Speaker 4: last year was it last year you had student loan
15:10
Speaker 4: payments restarting last fall?
15:12
Speaker 3: YEP, so it had student loans.
15:14
Speaker 2: Those are not common amongst lower income. They're fertiles, so
15:18
Speaker 2: most of the people with student loans actually make pretty
15:21
Speaker 2: good income.
15:21
Speaker 4: Yeah, I'm not really willing to attribute it to that.
15:24
Speaker 4: I suppose the longer you just continue to rack up
15:28
Speaker 4: credit card dead. Eventually you start hitting a wall there,
15:31
Speaker 4: but I wouldn't expect that to be hit by every person.
15:33
Speaker 4: At the same time, we haven't seen an uptick in unemployment,
15:37
Speaker 4: especially not in lower paying jobs.
15:40
Speaker 2: Well, we have seen an upticke in unemployment. There has
15:44
Speaker 2: been a half percentage point up ticket unemployment, and the
15:46
Speaker 2: underemployment rate has been moving up as well. So I
15:49
Speaker 2: guess more people that are part time that would want
15:51
Speaker 2: to be full time.
15:52
Speaker 4: I guess what I'm a little bit more surprised by
15:55
Speaker 4: is you know, we talk about the wealth effect, and
15:58
Speaker 4: you started to see stock values come down, especially among
16:04
Speaker 4: high flying sectors that really led the market over the
16:06
Speaker 4: last few years. It's apparent to me or maybe the
16:10
Speaker 4: data is so lagging that that doesn't seem to be
16:13
Speaker 4: affecting spending on the high ten percent of income earners,
16:16
Speaker 4: for example.
16:17
Speaker 2: I think there's a lag when it comes to the
16:18
Speaker 2: wealth effect. Yeah, and part of it is, Look, most
16:20
Speaker 2: of the damage that's been done to this market happened
16:23
Speaker 2: since the start of March.
16:24
Speaker 3: True, there wasn't a whole lot of damage in January.
16:26
Speaker 2: No.
16:27
Speaker 3: In fact, markets reached all time highs in mid February and.
16:29
Speaker 2: You don't get your March statement or even your Q
16:32
Speaker 2: one statement until the first week in April or so,
16:35
Speaker 2: so you know, someone might be like, oh, like, yeah,
16:37
Speaker 2: my portfolios. You know, fine, it's still you know, five
16:39
Speaker 2: hundred thousand dollars. And then they get it, you know,
16:42
Speaker 2: if we stay at these levels, they get it in
16:45
Speaker 2: you know, April third, and they're like, oh, my five
16:48
Speaker 2: hundred thousand has turned into four hundred and seventy thousand.
16:51
Speaker 2: Maybe I should, you know, adjust how I was going
16:53
Speaker 2: to be spending. So I'm not saying it will or
16:56
Speaker 2: won't happen. It's I was talking with more ark Fandetti
17:00
Speaker 2: about this earlier today and kind of the causality of hey,
17:05
Speaker 2: do you see kind of what came first, chicken or egg?
17:09
Speaker 2: Do you see markets that weaken and then you know,
17:11
Speaker 2: spending weekends as a result, or do you see the opposite?
17:15
Speaker 2: And it really depends on the economic environment and the
17:17
Speaker 2: specific root causes, because you've seen both at different points historically,
17:21
Speaker 2: there's nothing that you can point to definitively and be like, yes,
17:25
Speaker 2: when markets go down X, that's when consumers pull back
17:28
Speaker 2: on spending, and that's when the economy slows or vice versa.
17:31
Speaker 2: It's not you know, definitively, Hey, spending slowed in the economy,
17:35
Speaker 2: and so that's when markets pulled back. Why, it's very
17:38
Speaker 2: much always something that's in flux, because the economy is
17:41
Speaker 2: never in the same spot it was in yesterday.
17:43
Speaker 3: Yeah.
17:43
Speaker 4: Muhammad al Aarian was giving an interview two or three
17:47
Speaker 4: days ago, and he was talking about a lot of
17:49
Speaker 4: the soft data, because the soft data is something to
17:52
Speaker 4: this point, well, yeah, softened quite a bit and also
17:57
Speaker 4: hasn't been accompanied by drops in the hard data. And
17:59
Speaker 4: the point that he made was, yes, this data was
18:03
Speaker 4: unreliable for the COVID period, but if you go back further,
18:08
Speaker 4: what he sees is soft data basically leading the hard
18:13
Speaker 4: data by three to six months. And so we saw
18:17
Speaker 4: the soft data turning in January and February, you know,
18:20
Speaker 4: consumer sentiment, things along those lines. The question is are
18:25
Speaker 4: we back to the normal pre COVID period or are
18:28
Speaker 4: we still in this kind of weird, strange environment where
18:31
Speaker 4: people respond exceedingly negatively when you ask them about how
18:35
Speaker 4: they feel about things and then just continue on spending
18:38
Speaker 4: like there is no tomorrow.
18:40
Speaker 3: I don't have a good answer for you.
18:41
Speaker 4: And and by the way nor does like the most
18:45
Speaker 4: informed group of people about the economy, the Federal Reserve.
18:48
Speaker 4: They were asked this specific question, will the hard data
18:51
Speaker 4: follow the soft data, and they said, we don't know.
18:53
Speaker 2: We got no clue.
18:54
Speaker 4: Didn't work for the last four years, so let's not
18:57
Speaker 4: count all this before it actually comes to pass.
19:00
Speaker 2: Yeah, and what we're hearing from companies is kind of
19:02
Speaker 2: the same thing. It's like, yeah, we're seeing some weakness
19:04
Speaker 2: in some areas, other places we're not, and so we'll
19:07
Speaker 2: have to see how it goes. I know that we're
19:10
Speaker 2: kind of a broken record on that because I've been
19:12
Speaker 2: saying that for like the last three months.
19:14
Speaker 3: Yeah, just wake me up in a year.
19:16
Speaker 2: But it's like, we're just gonna have to see how
19:18
Speaker 2: things go because there's a wide range of outcomes as
19:20
Speaker 2: far as where things can go economically over the next
19:23
Speaker 2: three to six months, and we're just gonna have to
19:27
Speaker 2: see where it goes. Quick Break Wall Street watches next.
19:41
Speaker 1: Like us on Facebook and follow us on Twitter at
19:44
Speaker 1: TFE show. Breaking business news is always first right here
19:48
Speaker 1: on the Financial Exchange Radio Network. Time Now for Wall Street.
19:54
Speaker 1: Watch a complete look and what's moving market so far
19:57
Speaker 1: today Right here on the Financial Exchange Radio network.
20:00
Speaker 5: Markets are modestly selling off to wrap up the week
20:04
Speaker 5: a little bit of a bumpy ride so far this morning,
20:06
Speaker 5: with the SMP five hundred is currently on pace to
20:09
Speaker 5: extend its losing street streak to five straight weeks. Investors
20:14
Speaker 5: are also reacting to a new batch of corporate earnings
20:17
Speaker 5: from FedEx, Nike, and Micron Technology. At the moment, the
20:22
Speaker 5: Dow is down by nine tenths of a percent or
20:24
Speaker 5: three hundred and seventy four points, SMP five hundred down
20:28
Speaker 5: by three quarters of percent or forty one points, and
20:31
Speaker 5: the Nasdaq is down by six tenths of a percent
20:34
Speaker 5: or one hundred and six points. RUSSED two thousand selling
20:37
Speaker 5: off one on a third percent or twenty seven points lower.
20:40
Speaker 5: Ten year treasure reeled is flat at four point two
20:42
Speaker 5: three percent, and crude oil flat as well, trading just
20:46
Speaker 5: above sixty eight dollars a barrel. FEDEC shares down ten
20:51
Speaker 5: percent after the delivery Giant reduced its full year guidance,
20:55
Speaker 5: citing weakness in the US industrial economy. UPS also seeing
20:59
Speaker 5: sympathy losses on the day in reaction to that news.
21:03
Speaker 5: UPS shares down by three percent. Meanwhile, Nike shares also
21:07
Speaker 5: sinking today, now down nearly seven percent, after the athletic
21:11
Speaker 5: apparel maker warned that its sales will fall in the
21:14
Speaker 5: current quarter as it continues to push discounts to clear inventory. Elsewhere,
21:20
Speaker 5: Micron Technology stocked down by seven percent, despite the chip
21:23
Speaker 5: maker beating street forecast for the previous quarter. According to
21:27
Speaker 5: the Minnesota Star Tribune, steel producer Cleveland Cliffs will temporarily
21:32
Speaker 5: idle two factories, resulting in hundreds of job cuts. That
21:35
Speaker 5: decision comes as automakers have reduced orders amid uncertainty link
21:40
Speaker 5: to President Trump's tariff policies. Cleveland Cliff shares down by
21:44
Speaker 5: three percent. US Steel offered weak guidance for the current quarter,
21:47
Speaker 5: sending that stock down by one percent, and home builder
21:51
Speaker 5: Leonard guided for lower than expected new orders for its
21:54
Speaker 5: fiscal second quarter. However, its earnings and revenue beat expectations
22:00
Speaker 5: and our shares down by six percent. I'm Tucker Silva
22:04
Speaker 5: and that's Wall Street.
22:04
Speaker 3: Watch.
22:05
Speaker 2: Hey, Chuck.
22:05
Speaker 4: Remember that nice little market rally we got on the
22:08
Speaker 4: on the FED meeting.
22:09
Speaker 3: Yeah, it's gone.
22:11
Speaker 2: Oh yeah.
22:12
Speaker 4: SMP was sitting at fifty six thirty seven at two
22:16
Speaker 4: pm on Wednesday before the FED release their data, we
22:19
Speaker 4: got a nice little bump in shares and it's now
22:22
Speaker 4: sitting at fifty six twenty two. So don't respond to
22:26
Speaker 4: day to day moves in the markets, I think is
22:28
Speaker 4: the short term lesson there.
22:30
Speaker 2: Micron Technology reported earnings after the bell yesterday. They are
22:33
Speaker 2: the biggest US manufacturer of memory chips. They gave good forecasts,
22:39
Speaker 2: good numbers, and they said, look, AI is you know,
22:41
Speaker 2: causing us to you know, be able, not causing, but
22:44
Speaker 2: it's allowing us to expand our business. And despite that,
22:47
Speaker 2: Micron shares down almost seven percent in trading today, And
22:52
Speaker 2: so this continues a run of companies. Hey, even if
22:55
Speaker 2: you're reporting good earnings still ending up being punished. This
22:59
Speaker 2: despite micro initially being up a couple percentage points after
23:02
Speaker 2: they reported yesterday, but just unable to hold onto those
23:09
Speaker 2: gains there.
23:11
Speaker 4: Yeah, it's not exactly a good sign when you have
23:14
Speaker 4: solid earnings being punished. It doesn't necessarily spell disaster, but
23:18
Speaker 4: clearly investors are are nervous, and I think are generally
23:25
Speaker 4: this year have been just dumping what's done fairly well
23:28
Speaker 4: over the last few years. Right, you think about the
23:31
Speaker 4: Magnificent seven, for example, not exactly, highly susceptible to trade risk,
23:35
Speaker 4: for example, but I haven't performed terribly well. Well, I
23:38
Speaker 4: mean some of them are. Some of them are, but
23:40
Speaker 4: I mean Amazon, Amazon susceptible to it here and there.
23:47
Speaker 4: Amazon's hugely susceptible to it. Half the stuff they sell
23:50
Speaker 4: has made in China. Yeah, there's a huge ish the
23:54
Speaker 4: ones that I think are you know, susceptible. When you
23:56
Speaker 4: talk about, you know, the potential for trade issues, the
23:59
Speaker 4: only one that I think are let me give you
24:01
Speaker 4: the ones that I think are insulated there, Microsoft, Google.
24:03
Speaker 3: And Meta right.
24:05
Speaker 2: Other than that, in video potentially major problems, Apple, potentially
24:10
Speaker 2: major problems. Amazon huge issues, you know, depending on where
24:13
Speaker 2: China tariffs go, and Tesla certainly you know, problems from
24:17
Speaker 2: a supply chain perspective. Yeah. So I think four out
24:19
Speaker 2: of the seven a half real issues on that side
24:21
Speaker 2: of things, And even the ones that I said, like, hey,
24:24
Speaker 2: probably not anything huge, still have some things they could
24:28
Speaker 2: have to deal with because of all the spending they're
24:29
Speaker 2: doing on AI depending on how tariffs end up, you know,
24:33
Speaker 2: potentially weighing on the cost of you know, those imports.
24:36
Speaker 2: Because remember, even though in Vidia is a US based company,
24:40
Speaker 2: They're not really making any of their stuff here right now.
24:42
Speaker 2: You know, the production is happening in Taiwan semiconductor, and
24:46
Speaker 2: those factories in Arizona are not spooled up producing you know,
24:49
Speaker 2: state of the art in Vidia chips at the moment.
24:52
Speaker 2: So yeah, some some questions you know, on on those
24:57
Speaker 2: piece from is this Bloomberg? Yep, yeah, it is Bloomberg.
25:02
Speaker 2: The headline is money losing retail crowd keeps buying stocks
25:05
Speaker 2: as market teeters. And again we get different data on
25:09
Speaker 2: this every day. This one says individual traders put more
25:13
Speaker 2: than twelve billion dollars into US equities in the weekend
25:16
Speaker 2: in March nineteenth, according to data from JP Morgan Chase. Okay,
25:21
Speaker 2: sure they so a few different things on this. The
25:24
Speaker 2: first is all of these numbers that get tossed around
25:28
Speaker 2: in these pieces, they're estimates because no one actually has
25:32
Speaker 2: one hundred percent clear data into who is a retail
25:35
Speaker 2: trader and who is not in terms of how things
25:37
Speaker 2: are executing. Because the companies, the companies that are reporting
25:42
Speaker 2: this are not the exchanges, because the exchanges have value
25:45
Speaker 2: in being able to you know, not publicly make available
25:48
Speaker 2: who's trading on any particular product on any particular day.
25:52
Speaker 2: So these are all estimates. And furthermore, the the really
25:58
Speaker 2: good estimates that banks make on this stuff and the
26:03
Speaker 2: trading does make on this stuff, they don't publish. Yeah,
26:08
Speaker 2: they think it gives them an edge. Correct. So I'm
26:11
Speaker 2: not saying that this is twelve million, twelve billionaire. It's not.
26:14
Speaker 2: It's just it's an estimated. It's one bank's estimate, and
26:17
Speaker 2: take it for what it's worthy.
26:19
Speaker 4: The estimate also is that so far this year, retail
26:24
Speaker 4: traders as a group have lost seven percent for the year,
26:29
Speaker 4: while the S and P as we know is dropped
26:31
Speaker 4: I don't know where were four percent for the year,
26:33
Speaker 4: which again I could hypothetically buy that the average retail
26:37
Speaker 4: investor has more exposure to Magnificent seven, which has done
26:40
Speaker 4: worse than the market. But I just I'm not sure
26:44
Speaker 4: I buy these numbers. And I also don't know that
26:47
Speaker 4: there's much that you should do with these numbers other
26:49
Speaker 4: than so, yeah, recognize that in the last few severe
26:53
Speaker 4: quick market downturns, oftentimes retail traders have been left hold
26:56
Speaker 4: in the bag more than your.
26:57
Speaker 3: Institutional ones, but not always.
27:00
Speaker 4: How many hedge funds blew out over the course of
27:02
Speaker 4: the last few years on massive swings and markets.
27:05
Speaker 3: Many is the answer Many.
27:07
Speaker 2: Take a quick break here. When we come back, we'll
27:10
Speaker 2: talk about some of the different challenges that single retirees face. It's,
27:15
Speaker 2: you know, again, something that has always been you know,
27:19
Speaker 2: the issue. Hey, I'm a single retiree. You know my
27:21
Speaker 2: situation is different from those who are married. But some
27:24
Speaker 2: new challenges cropping up in recent years. We'll discuss those
27:27
Speaker 2: and how you can try to navigate them.
27:30
Speaker 1: After this, The Financial Exchange streams live on YouTube. Like
27:35
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27:38
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27:42
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28:05
Speaker 2: All right, Mike, we got this piece from Barons here.
28:07
Speaker 2: It's titled single Retirees face New Challenges. Here are the
28:13
Speaker 2: ways to cope? What kind of new challenges to single
28:17
Speaker 2: retirees face today?
28:19
Speaker 4: So I'll get to the existing challenges that have always
28:23
Speaker 4: been there, and I've got some stats to go there.
28:25
Speaker 4: But I think the new ones have to do with
28:28
Speaker 4: just the social interactions that we're having in twenty twenty
28:32
Speaker 4: five compared to even ten years ago, and whether it's
28:37
Speaker 4: because of social media or you know, COVID, a number
28:42
Speaker 4: of different things have changed the ways in which we
28:44
Speaker 4: interact with each other. And globally there have been higher
28:48
Speaker 4: reports of loneliness and just fewer in person social interactions
28:53
Speaker 4: than we had in previous generations. And so I think
28:56
Speaker 4: that's the number one new challenge that are facing people.
28:59
Speaker 4: It's not changed to social security or taxes or any rules.
29:03
Speaker 4: It is changes to how we as humans are interacting
29:06
Speaker 4: with each other in twenty twenty five compared to previous generations.
29:11
Speaker 2: From a financial perspective, when we look at, you know,
29:15
Speaker 2: kind of the big financial things that single retirees face,
29:18
Speaker 2: a lot of those, as you mentioned are still the same. Hey,
29:20
Speaker 2: if you previously were married, you go from potentially you know,
29:23
Speaker 2: two social Security benefits down to one.
29:27
Speaker 1: Uh.
29:28
Speaker 2: It becomes something where you know, you just try to
29:30
Speaker 2: figure out, Hey, From a living space perspective, do I
29:34
Speaker 2: need to have you know, the same size home that
29:36
Speaker 2: I did previously? How do I cover you know, things
29:40
Speaker 2: like healthcare and long term care costs? Those things become
29:44
Speaker 2: problematic potentially as you get older, and you know that
29:48
Speaker 2: certainly is something that you've always had to deal with
29:51
Speaker 2: as a retiree or a single retiree. There have not
29:54
Speaker 2: been any major changes to the programs that form the
29:58
Speaker 2: backbone of you know, tirese financial situation in Social Security,
30:02
Speaker 2: Medicare and things like that.
30:04
Speaker 4: But when do talk about something called a widow's tax
30:07
Speaker 4: right where sure that that's been mentioned before, probably on
30:10
Speaker 4: this program, where it's one thing when you go through
30:13
Speaker 4: a divorce and you split assets. But let's play out
30:15
Speaker 4: the scenario of a widow or a widower. You effectively
30:20
Speaker 4: have your tax brackets cut in half, but you retain
30:24
Speaker 4: most of the income that you had while there were
30:27
Speaker 4: two people living. Right, and you might need most of
30:29
Speaker 4: the income that you previously because certainly your expenses don't
30:31
Speaker 4: get cut in half. You might get rid of a car,
30:33
Speaker 4: but you usually don't sell a home. You usually don't
30:35
Speaker 4: move in the case of a loss of a spouse.
30:38
Speaker 4: The really compelling stuff to me are the actual studies
30:41
Speaker 4: on things like life expectancy and need for care on
30:46
Speaker 4: a married couple versus a single individual.
30:48
Speaker 3: So I'll cite a few of these.
30:49
Speaker 4: One Boston College has this Center for Retirement Studies that
30:54
Speaker 4: does some really interesting research, and they did something like
30:56
Speaker 4: a twenty or thirty year study, yeah, on retirees and
31:00
Speaker 4: their interactions with long term care, and what they found
31:03
Speaker 4: was that married men and women about sixty percent sixty
31:08
Speaker 4: percent of women, sixty one percent of men ended up
31:11
Speaker 4: needing some sort of moderate to severe long term care
31:17
Speaker 4: that could mean a facility, that could mean you know,
31:20
Speaker 4: home care, but you know, sixty plus percent of them
31:23
Speaker 4: who were married needed that. When you looked at the
31:26
Speaker 4: same type of care for unmarried women and men, it
31:30
Speaker 4: went from sixty to sixty six percent for women and
31:33
Speaker 4: sixty one to sixty four percent for men, So a
31:35
Speaker 4: pretty significant jump in those that need that type of
31:39
Speaker 4: care because quite frankly, when you're married, a spouse ends
31:41
Speaker 4: up providing a lot of the care and it's not
31:43
Speaker 4: all that severe. Likewise, on the life expectancy side of things,
31:46
Speaker 4: I found this to be pretty wild. Sixty five year
31:50
Speaker 4: old married men life expectancy eighteen point six years. Divorced
31:55
Speaker 4: sixty five year old men sixteen point three years. It's
31:58
Speaker 4: a two year life expectancy gap. And the same pretty
32:03
Speaker 4: much holds true for women. Twenty one point one years
32:06
Speaker 4: of life expectancy versus nineteen point seven for a sixty
32:10
Speaker 4: five year old. So what's the lesson. I guess get married. No,
32:15
Speaker 4: that's not the lesson that I'm pointing out. I think
32:17
Speaker 4: the lesson is doing some planning here, because nobody thinks
32:23
Speaker 4: about the loss of the spouse in terms of their plans.
32:26
Speaker 4: But I'll mention one other thing with all of this.
32:28
Speaker 4: You know we talked about not a lot of changes.
32:32
Speaker 4: Medicaid is on the table for being changed. Why does
32:34
Speaker 4: that matter when we're talking about single retirees. Well, if
32:38
Speaker 4: you're more likely to need severe long term care, you're
32:41
Speaker 4: more likely to end up in a nursing home. If
32:43
Speaker 4: Medicaid gets cut, what does that mean? It means that
32:45
Speaker 4: the reimbursement rates that Medicaid pays for people in nursing
32:48
Speaker 4: homes go down.
32:51
Speaker 3: Chuck.
32:52
Speaker 4: I know this isn't a well known subject, but like
32:53
Speaker 4: what happens if the Medicaid reimbursement rate goes down for
32:56
Speaker 4: everybody that's paying privately, goes up, Costs probably goes up.
33:00
Speaker 4: We're already in New England talking about fifteen thousand dollars
33:04
Speaker 4: a month. If you see Medicaid cut their reimbursements. There
33:08
Speaker 4: then you have a large pool of people who are
33:09
Speaker 4: getting the same level of care but not paying for
33:13
Speaker 4: it much, and Medicaid's not kicking in as much, meaning
33:15
Speaker 4: anybody who has assets could end up paying a lot more.
33:20
Speaker 4: This is not a pleasant subject to talk about it though,
33:22
Speaker 4: I want to be clear about that. It's not a
33:24
Speaker 4: terribly pleasant subject to talk about if you are approaching
33:28
Speaker 4: retirement in maybe one of those non standard type situations.
33:32
Speaker 4: Maybe you're divorced, maybe you're separated, maybe you've lost a
33:36
Speaker 4: loved one and you're trying to figure out what comes next.
33:43
Speaker 4: I know it's intimidating and it's really difficult to talk about,
33:47
Speaker 4: but it really really pays off to do this thinking
33:51
Speaker 4: ahead of time, to figure out how your state plan
33:54
Speaker 4: is going to work into your financial plan, to figure out,
33:56
Speaker 4: you know what, if there's an age difference between us,
33:59
Speaker 4: how do we plan for those later years?
34:01
Speaker 3: And the time to do it.
34:03
Speaker 4: I'm not saying don't do anything if you're already in
34:05
Speaker 4: your sixties and seventies, but the time to address these
34:08
Speaker 4: types of things is when you still can buy insurance,
34:10
Speaker 4: when you still can look at solutions that will help
34:13
Speaker 4: you address these problems for the future if you have
34:16
Speaker 4: questions along these lines and you could use some of
34:18
Speaker 4: that consultation. The numbers eight hundred three nine three for
34:22
Speaker 4: zero zero one for the Armstrong Advisory Group and again
34:25
Speaker 4: that phone number eight hundred three nine three for zero
34:28
Speaker 4: zero one.
34:30
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
34:32
Speaker 1: registered investment advisor. Nothing in the ad or in any
34:35
Speaker 1: Armstrong guide a specific financial, legal or tax advice. Consult
34:38
Speaker 1: your own financial tax into state planning advisors before making
34:40
Speaker 1: any investment decisions. Armstrong make contact you to offer investment
34:44
Speaker 1: advisory services.
34:45
Speaker 2: Have either of you seen anyone who has used or
34:51
Speaker 2: shown you anything they've done with Apple Intelligence since it
34:54
Speaker 2: was released last night?
34:55
Speaker 3: Fall?
34:56
Speaker 5: So, I actually just purchased the base I phone sixteen.
35:02
Speaker 2: How's how's how's it running?
35:04
Speaker 5: Kind of like the old one at a ten R
35:06
Speaker 5: still texts, still calls. Yeah, I mean it's a little lighter,
35:10
Speaker 5: it's a little faster, yeah, But huge difference. And in
35:13
Speaker 5: terms of Apple Intelligence, like I was prompted to like
35:16
Speaker 5: go through tutorials and everything.
35:18
Speaker 2: Skip the So here's the thing with Apple Intelligence. The
35:23
Speaker 2: early reviews are bad to quite bad. Uh, you had
35:26
Speaker 2: news organizations that basically pulled their content from it because
35:30
Speaker 2: their stories were being summarized incorrectly. Uh, it is not
35:34
Speaker 2: summarizing your messages correctly, and this and that, and it
35:39
Speaker 2: seems like they botched the rollout. So a report from
35:42
Speaker 2: Bloomberg has said that Tim Cook is internally moving on
35:47
Speaker 2: from the current head of like Siri and their their
35:51
Speaker 2: AI department, John Jenandrea, which is just a great name, Like.
35:55
Speaker 3: The am so nice guys, so nice to named twice.
35:58
Speaker 2: What a great name. I mean, I knew someone in
36:01
Speaker 2: college named Peter Peterman and I thought that was good.
36:03
Speaker 2: But John gen Andrea, Yeah, that's pretty good, is right
36:06
Speaker 2: up there with it. But here's where I think. I'm
36:11
Speaker 2: just trying to wrap my head around this. So Apple's
36:14
Speaker 2: so Tim Cook saying, look, we need to get better
36:16
Speaker 2: at you know, AI for the consumer. Okay, fine, so
36:19
Speaker 2: let's go get someone who you know, really has this
36:22
Speaker 2: AI background and you know, some kind of you know,
36:25
Speaker 2: really focused in this area or something they are bringing.
36:31
Speaker 2: And again this is from Bloomberg's reporting, the guy who
36:34
Speaker 2: headed up the vision pro headset is going to take
36:38
Speaker 2: over running their AI department.
36:41
Speaker 3: Now, let's be fair, neither of us know.
36:43
Speaker 2: Nope, but I do know that the vision Pro headset
36:48
Speaker 2: has not really been popular. I don't think it was
36:50
Speaker 2: expected to be particularly popular. It was kind of a
36:52
Speaker 2: public beta test almost.
36:54
Speaker 3: But seemingly no big picture AI expertise.
36:59
Speaker 2: I'm just trying to figure out where And look, I
37:02
Speaker 2: am a believer that hey, if if, if you actually
37:07
Speaker 2: think that you can do something with AI to you know,
37:10
Speaker 2: help individuals that's based on your phone and not having
37:13
Speaker 2: to use you know, crazy amounts of computing power to
37:15
Speaker 2: do so. Okay, like that's an approach I can get behind.
37:20
Speaker 2: But Apple has not executed well to begin with, and
37:24
Speaker 2: quite honestly, like the last two things that they've you know,
37:27
Speaker 2: hyped up in the last year, it's been the Vision
37:28
Speaker 2: Pro and Apple Intelligence. Yea fair case that both of
37:32
Speaker 2: them have been flops. Now that the Vision Pro was
37:34
Speaker 2: expected to be a flop given that it costs thirty
37:36
Speaker 2: five hundred dollars, but Apple Intelligence was not expected to
37:40
Speaker 2: be a flop.
37:41
Speaker 4: Right, And I go back to look, series been pretty
37:44
Speaker 4: lacking for quite some time now.
37:46
Speaker 2: Well, hey, at least it's not like it is it
37:49
Speaker 2: Google or Amazon that announced last week that they're no
37:51
Speaker 2: longer going to allow you to store your recordings locally.
37:55
Speaker 2: You have to upload it to them.
37:57
Speaker 3: I don't know.
37:57
Speaker 2: I forget which one of them was, but you know,
38:00
Speaker 2: there's some pretty dystopian stuff that's happening here, and I'm
38:03
Speaker 2: very happy that I have as few devices of these
38:05
Speaker 2: as possible in my home.
38:06
Speaker 4: I think it's finally starting to catch up to Apple that, Okay,
38:09
Speaker 4: we've avoided this for as long as we can, we
38:10
Speaker 4: need to actually do something.
38:12
Speaker 2: I guess this is something. We'll see how it goes.
38:15
Speaker 2: But it's uh, I don't know. It doesn't seem like
38:17
Speaker 2: much quick break here. Hour two coming up in a
38:20
Speaker 2: bit