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Gas Prices Stay High as Refinery Bottlenecks Bite · The Financial Exchange Show

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1:03
Speaker 1: This is the Financial Exchange with Chuck Zada and Mike Armstrong.
1:09
Speaker 2: Chuck Mike A Zucker with you here today on the
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Speaker 2: financial exchange, and stocks are down wamp bump. The S
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Speaker 2: ANDB five hundred is off sixty five points, the Dow
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Speaker 2: is off ninety points, and the NASDAK composite is feeling
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Speaker 2: the most pain, down four hundred and twenty seven points
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Speaker 2: about one and a half percent. The Dow actually is
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Speaker 2: off less than a quarter percent, so not much movement there.
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Speaker 2: Why is the NASDAK down so much, Well, it happens
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Speaker 2: to be because technology stocks are taking it on the
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Speaker 2: chin here, with tech down around one point eight percent,
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Speaker 2: overall communication services down around two percent as well. As
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Speaker 2: we are seeing pullbacks. Remember, communication services is like this
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Speaker 2: just this Frankenstein of a sector quite honestly, in the
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Speaker 2: S and P where you've got like, hey, it's Google
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Speaker 2: and Meta. Oh okay, you mean they're internet companies. No,
2:01
Speaker 2: you've actually got T Mobile and Verizon in there. Oh
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Speaker 2: so their phone companies. No, you've got Disney and Netflix.
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Speaker 2: Oh so they're entertainment companies. Well, and then you've got
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Speaker 2: Electronic Arts and Take two. Oh so they make video
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Speaker 2: games too. That's communication services. But Google, Meta and Netflix
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Speaker 2: all with significant losses on the day. Uh, you've got
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Speaker 2: the ten year treasury it is down four point four
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Speaker 2: basis points to four point five to two five percent.
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Speaker 2: Dollar index not really sliding on that. Interesting we'll discuss,
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Speaker 2: Uh that is. Dollar index is flat at one hundred
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Speaker 2: point five to six. The price of gold is up
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Speaker 2: twelve eighty an ounce to four thousand and four dollars,
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Speaker 2: and crude oil West Text Intermediate up another two dollars
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Speaker 2: and fourteen cents to eighty one oh three, triple a
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Speaker 2: national average. Four Gas prices rising another four cents overnight
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Speaker 2: to three ninety eight, diesels up another five point three
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Speaker 2: cents to five oh five, And based on what we
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Speaker 2: are seeing from crude oil prices and refinery costs, gotta
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Speaker 2: say diesel's probably heading towards five twenty to five twenty
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Speaker 2: five next week, and gas probably getting close to four
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Speaker 2: ten maybe four point fifteen nationally based on what we
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Speaker 2: are seeing. This dovetails fantastically into our top story of
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Speaker 2: the hour, which is this piece from the Wall Street Journal.
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Speaker 2: Gas prices will stay higher for longer even if oil falls,
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Speaker 2: and that's.
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Speaker 3: Greedy gas station owners, chuck.
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Speaker 2: Yes, it's just those gas station owners that love to
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Speaker 2: eke out one cent a gallon on their gas prices. Folks,
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Speaker 2: if you've ever talked to anyone who's owned a gas station,
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Speaker 2: they make like no money off of gas. The whole
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Speaker 2: thing is a front to get you in there to
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Speaker 2: buy bottled water and soda, lottery tickets and lottery tickets
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Speaker 2: and cigarettes like. That's where the money is made. It's
3:49
Speaker 2: not on the gas like gas prices get you to stop.
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Speaker 2: They make their money selling you the stuff inside. So
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Speaker 2: here's the deal. Gas prices are a function primarily of
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Speaker 2: two things. Number one is the thing that we all,
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Speaker 2: you know, pay attention to the price of crude oil,
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Speaker 2: which as of right now again is back up to
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Speaker 2: you know, almost eighty two dollars for I'm sorry, eighty
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Speaker 2: one dollars for West Texts Intermediate. It's about a twenty
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Speaker 2: percent bump since last since a couple of weeks ago.
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Speaker 3: So that's that's part of this.
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Speaker 2: The other part is something that most people are not
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Speaker 2: familiar with. We've talked about it on our show, but
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Speaker 2: it's called the crackspread, and cracking is the term for
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Speaker 2: the process that turns crude oil into refined product. Mike,
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Speaker 2: when's the last time you went to a gas station
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Speaker 2: and bought any crude oil? I have not ever done, Tucker,
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Speaker 2: you ever buy any.
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Speaker 4: Crude I can't say that I have.
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Speaker 5: Chuck.
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Speaker 2: No, you're a pretty refined guy. I respect that about you.
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Speaker 2: So here's the thing. None of us buy crude oil
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Speaker 2: unless you're like an energy trader, and then like even
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Speaker 2: then you probably never take delivery. None of us buy
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Speaker 2: crude oil. We survive by using refined product. And here's
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Speaker 2: what's happened with crackspreads, which the difference. The crackspread is
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Speaker 2: the difference between the price the refinery pays for crude
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Speaker 2: and what the buyer pays for the refined product. The
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Speaker 2: most common one, it's the three two to one crackspread.
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Speaker 2: Take three barrels of crude, turn it into two of
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Speaker 2: gas and one of diesel. So here's what we're seeing
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Speaker 2: right now, from basically late twenty twenty threes through early
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Speaker 2: twenty six that three two one crackspread set in a
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Speaker 2: pretty comfortable range between fifteen and twenty five dollars most
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Speaker 2: of the time. Occasionally we get a little lower, occasionally
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Speaker 2: a little higher, but that was kind of the range.
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Speaker 2: It was in the three to one crackspread today is
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Speaker 2: north of seventy dollars a barrel. You heard me right,
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Speaker 2: seventy It's basically tripled since the start of the Iran conflict.
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Speaker 2: There are two reasons for this. The first, there are
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Speaker 2: a bunch of refineries within the Persian Gulf that are
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Speaker 2: offline because they don't know if they can get the
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Speaker 2: product out, and so you don't just like turn on
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Speaker 2: and like produce a bunch of gas if you can't
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Speaker 2: put it anywhere, you stop. So that's number one is
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Speaker 2: you have a bunch of refineries in the Middle East offline.
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Speaker 2: Piece number two is Ukraine, in order to try to,
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Speaker 2: you know, repel Russian attacks, over the last couple months,
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Speaker 2: has taken to a much more aggressive strategy of launching
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Speaker 2: hundreds of drones deep into Russia, specifically targeting Russian oil refineries.
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Speaker 2: About forty percent of Russian's refinery capacity is offline now
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Speaker 2: to the point where Russia, again this is Russia. Remember,
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Speaker 2: Russia has banned the export of gasoline and diesel because
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Speaker 2: they just don't have enough internally, even because so many
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Speaker 2: refineries are offline because of Ukrainian drones.
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Speaker 3: So what you have here is.
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Speaker 2: Not oil companies waking up and just saying, hey, guys,
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Speaker 2: do you guys think we could like be a little greedier.
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Speaker 3: Like no, let's be.
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Speaker 2: Honest, Every large publicly traded company is always greedy. I
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Speaker 2: don't have a problem with that. That's fine, Like, that's
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Speaker 2: the nature of the beast. It is our job as consumers.
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Speaker 2: And partly you can make a case for, hey, the
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Speaker 2: regulatory apparatus in order to encourage competition. When you have
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Speaker 2: more competition, it acts as a natural cap on greed
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Speaker 2: because if you get too greedy, someone comes in and
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Speaker 2: eats your profit and then it's gone. So ultimately, this
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Speaker 2: is not oil companies waking up in refiners waking up
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Speaker 2: being like, hey, let's be greedy.
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Speaker 3: It's it's disruption.
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Speaker 2: It's the end buyer saying, hey, I still need X
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Speaker 2: million barrels of gasoline today in order to meet consumer demand. Fine,
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Speaker 2: there's fewer refineries. Think about it from a supply and
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Speaker 2: demand perspective. If there's less supply of gasoline and the
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Speaker 2: same demand, what happens. Price goes up. So that's why
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Speaker 2: that crackspread has been widening. The interesting piece to me,
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Speaker 2: Sorry Michael, last spot is that this month is where
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Speaker 2: we've seen crude oil prices move from sixty eight up
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Speaker 2: to eighty one. Despite that move up in crude prices,
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Speaker 2: crackspreads have still widened because that refinery capacity is just
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Speaker 2: so tight.
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Speaker 3: And this is why.
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Speaker 2: Even if you see crude prices come down, until there
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Speaker 2: is improvement on the refinery side, it's like you're not
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Speaker 2: going to see gas prices fall the same way that
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Speaker 2: you normally would yeap.
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Speaker 5: China's another piece of this puzzle too. They have been
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Speaker 5: a major lever in keeping oil prices, crude oil prices lower.
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Speaker 5: They've been buying less of this stuff on the open
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Speaker 5: market as part of that strategy, it also seems that
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Speaker 5: they are exporting less of the refined stuff that they
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Speaker 5: make domestically and keeping it more of that in their
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Speaker 5: country as well. And so once again, you have Middle
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Speaker 5: Eastern refineries that are offline, you have Russian refineries that
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Speaker 5: are offline. You have Chinese refineries that are online but
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Speaker 5: not necessarily exporting quite as much, perhaps because they don't
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Speaker 5: have as much oil to refine, perhaps because.
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Speaker 3: They just want to keep it strategically in their reserves.
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Speaker 2: And this, you know, the question that gets raised, then
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Speaker 2: is okay, Like, why doesn't China spool up their refineries.
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Speaker 3: Here's the thing.
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Speaker 2: If they do, maybe then they have to start importing
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Speaker 2: that five million barrels of day barrels a day of
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Speaker 2: crude again, and there's enough tightness in crude markets now
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Speaker 2: that maybe crude goes parabolic to the upside, like the
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Speaker 2: there is no there's no buffer anywhere at this point,
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Speaker 2: like we've eaten through it over the first half of
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Speaker 2: the year, and so anywhere that you look, unless you
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Speaker 2: get Hormuz open and flowing again the way it was
9:37
Speaker 2: a couple of weeks ago. I did a couple of
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Speaker 2: weeks ago, fine, but ideally the way that it was
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Speaker 2: earlier in the year. Until you get that, you can't
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Speaker 2: relieve this this problem that we have, like there's no
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Speaker 2: way to do it. Nearly US refineries right now. There
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Speaker 2: are the US gets. The US gets divided up in
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Speaker 2: to what are called pads. Pad D is the terminology.
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Speaker 2: There's five pads in the US. It stands for Petroleum
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Speaker 2: Administration for Defense Districts. Like a lot of economic things
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Speaker 2: that came out of the World War two era because
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Speaker 2: the US government was trying to figure out how to
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Speaker 2: get oil and refine product to where it needed to
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Speaker 2: in the country. The Gulf Coast pads PAD three has
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Speaker 2: been running it over one hundred percent capacity for basically
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Speaker 2: the last month now, which means they're pretty much like,
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Speaker 2: these systems are not built to run this hot for
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Speaker 2: this long, and so it's just like they're trying to
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Speaker 2: produce as much as they can and they can only
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Speaker 2: do that for so long, because again, when you run
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Speaker 2: over your normal stated capacity, you are very much stressing
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Speaker 2: your system to a pretty significant extent.
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Speaker 3: Let's take a quick break here.
10:53
Speaker 2: When we return, let's talk about airlines and airline credit
10:58
Speaker 2: cards and the business that has become for the companies.
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Speaker 4: Time for some Friday trivia here on the Financial Exchange,
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12:30
Speaker 2: Mike, we got a great piece in the Wall Street
12:32
Speaker 2: Journal that kind of explains some of the economics of
12:36
Speaker 2: airlines and their associated credit cards. It's titled a monster
12:40
Speaker 2: pile of airline points is supercharging summer travel. And here's
12:45
Speaker 2: the deal. If you ever look around and you see
12:47
Speaker 2: those offers for like, hey, sign up for this United
12:50
Speaker 2: card and get sixty thousand miles, or sign up for
12:52
Speaker 2: this Delta card and get fifty thousand. Those miles are like,
12:57
Speaker 2: they're not just free, like someone had to pay for them,
13:00
Speaker 2: and that's someone is the credit card issuer. Airlines love
13:05
Speaker 2: this because basically what happens is you sign up for
13:08
Speaker 2: their credit card and Chase or PNC or Bank of
13:13
Speaker 2: America or whoever the backing institution is says, great, we're
13:17
Speaker 2: gonna buy a bunch of miles from the airline, and
13:19
Speaker 2: so the airline gets a bunch of revenue for the
13:21
Speaker 2: purchase of the miles. It then also locks that customer
13:26
Speaker 2: more into using the airline because with the card often
13:30
Speaker 2: you get perks like hey, here's a free checked bag
13:32
Speaker 2: or a free.
13:33
Speaker 3: Drink or this is that.
13:34
Speaker 2: And so airlines like it because it is revenue that
13:38
Speaker 2: is coming into them and more brand loyalty.
13:42
Speaker 3: The credit card.
13:43
Speaker 2: Issuers like it because it gets them a customer they
13:46
Speaker 2: might not have had otherwise, and so overall it's a
13:51
Speaker 2: pretty nice little symbiotic relationship that exists here.
13:54
Speaker 5: It is it also does something that just infuriates me
13:58
Speaker 5: as a customer, which is makes the actual price of
14:02
Speaker 5: something utterly confusing. Right, I have no idea how to
14:08
Speaker 5: navigate the points systems as a customer. Here Therefore, I
14:12
Speaker 5: rarely use the points that I accumulate on airlines, and
14:16
Speaker 5: I feel as though navigating the point systems for these
14:19
Speaker 5: credit cards and airlines rewards programs is among the most
14:23
Speaker 5: confusing things, to the point that you know, the points guy,
14:26
Speaker 5: somebody on social media has built his own business around,
14:30
Speaker 5: you know, tricks and tips for how to use this stuff.
14:34
Speaker 5: But clearly, you know a lot of folks choose to
14:39
Speaker 5: use their credit cards in this way, select credit cards
14:43
Speaker 5: based on things like access to the lounges within airports
14:48
Speaker 5: and want to make their travel easier, somewhat discounted, and
14:55
Speaker 5: more exclusive using these credit cards. And I think the
14:57
Speaker 5: exclusivity piece is the the real hook with a lot
15:02
Speaker 5: of this stuff. It seems the lounges at these airports
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Speaker 5: have exploded over the last ten years, and you know,
15:10
Speaker 5: more and where people are willing to pay up for
15:12
Speaker 5: premium seats, lounge access, things along those lines, to the
15:16
Speaker 5: point that even Southwest is needing to build lounges at
15:18
Speaker 5: some of these airports.
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Speaker 2: Yeah, it does really speak to Again, we've covered this
15:22
Speaker 2: a lot where hey, in the twenty and twenty tens,
15:26
Speaker 2: it was how low can you get the cost of
15:28
Speaker 2: your product that was like that was what sold for
15:31
Speaker 2: airlines today, It's hey, there are you know, most people
15:37
Speaker 2: are still competing on price, but the place that airlines
15:40
Speaker 2: are making their money is with wealthy boomers and with
15:44
Speaker 2: like that top one percent segment of the population that
15:48
Speaker 2: is willing to pay for those premium products.
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Speaker 5: I gotta be honest. The lounge thing, I've been inside
15:53
Speaker 5: one before with my brother in law. I don't have
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Speaker 5: lounge access at airports. I don't fly all that frequently
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Speaker 5: in the first place, but it directly goes against my
16:03
Speaker 5: single goal when going to the airport, which is get
16:05
Speaker 5: there with just enough time to get through security and.
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Speaker 3: Literally walk on the plane.
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Speaker 5: I recognize there's delays and all sorts of things, but
16:12
Speaker 5: like we all have family who insist on getting to
16:15
Speaker 5: the airport four hours ahead of time. Me uh, tucker,
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Speaker 5: And the idea of that just makes my skin crawl,
16:22
Speaker 5: Like I want to be coasting through the airport barely
16:26
Speaker 5: making my flight, let alone not stopping at.
16:29
Speaker 3: Why do you want that? Stressed?
16:31
Speaker 4: Why would you want that?
16:32
Speaker 5: Why does like is that motivate you? Is that like, yeah,
16:35
Speaker 5: that's what I just I hate spending extra time.
16:38
Speaker 2: With the airport, grab a bike before the flight too,
16:41
Speaker 2: Like you know what, I'm very much on Tucker's approach, Like, no,
16:45
Speaker 2: not for me. Hey, Like I'm gonna get to the airport.
16:47
Speaker 2: I don't do four hours early. Like I'm not nobody does.
16:50
Speaker 3: I'm exaggerating, but likes early.
16:53
Speaker 2: When people complain about sitting at the airport for too long,
16:56
Speaker 2: I'm kind of like, I don't know what's Like, what's
16:59
Speaker 2: the big deal? Like if I'm traveling with my kids,
17:02
Speaker 2: who are you know, both under the age of six
17:04
Speaker 2: right now? Yeah, I've got to figure out some stuff
17:07
Speaker 2: for them to do. But like, I don't have to
17:10
Speaker 2: do anything once I'm there. It's just okay, sit here
17:13
Speaker 2: and you get a meal every few hours and you
17:15
Speaker 2: grab a drink or two, and I don't know, it's
17:17
Speaker 2: it's it's fine.
17:18
Speaker 3: I don't know. Maybe it's a competition for me. I'm
17:20
Speaker 3: not sure.
17:21
Speaker 4: I mean a competition. Yeah, like I oh, yeah, I
17:24
Speaker 4: got the challenge.
17:25
Speaker 5: I got the airport forty five minutes ahead of time
17:27
Speaker 5: and still made my flight.
17:28
Speaker 3: Yeah, baby, I'm not sure. I might have a defect.
17:32
Speaker 3: I think that's it.
17:34
Speaker 2: I think I need another hobby, Mike. I just it's
17:38
Speaker 2: holding my stop watch.
17:39
Speaker 3: Yeah you know, but.
17:41
Speaker 2: Uh, that's that's fine, uh Ai story. Ai isn't destroying
17:46
Speaker 2: entry level jobs, it's changing them.
17:49
Speaker 5: I gotta be honest. No, it is destroying entry level jobs. Okay,
17:53
Speaker 5: lay it out for me, Jock.
17:54
Speaker 2: How like you you see this with like how law
17:58
Speaker 2: firms are talking about hiring, just as example, you see
18:01
Speaker 2: this with how advertising agencies are talking about hiring. It's
18:04
Speaker 2: absolutely destroying entry level jobs. Is it doing it broadly
18:08
Speaker 2: enough for it to matter to the economy? No, but
18:12
Speaker 2: it is happening.
18:13
Speaker 5: Sure, Yeah, Okay, it's destroying some entry level jobs.
18:16
Speaker 3: No doubt fair enough. Yeah, I thought you were going
18:19
Speaker 3: down the route of this.
18:20
Speaker 5: Is changing the workforce in a meaningful way for the economy,
18:23
Speaker 5: and they're I'm not sure there's much evidence. But I
18:29
Speaker 5: also land at even if it's destroying some entry level jobs, chuck,
18:34
Speaker 5: advertising agencies and lawyers are not going to suddenly only
18:39
Speaker 5: hire fifty year olds with twenty years of experience. Well,
18:42
Speaker 5: those won't exist precisely, That's kind of my point. So
18:46
Speaker 5: it can't permanently destroy entry level jobs because you will
18:50
Speaker 5: someday have advertising designers who die off or retire, and
18:54
Speaker 5: so where's the rest of them going to come from?
18:56
Speaker 3: Mike, When have we ever thought that far ahead of
18:58
Speaker 3: my decision making?
18:59
Speaker 2: I know, yeah, yeah, you know, there's a reason like
19:04
Speaker 2: I long for the day where we have a shortage
19:05
Speaker 2: of lawyers, though.
19:08
Speaker 3: I mean, look that.
19:08
Speaker 2: We've been walking for that since the day's a Shakespeare.
19:10
Speaker 2: I mean, this is a thread that goes back throughout
19:13
Speaker 2: human history. Even though I will say, like you know,
19:18
Speaker 2: sometimes I think lawyers are underappreciated. I've gotten to that
19:22
Speaker 2: point where they're so disrespected that maybe they're undervalued. Put
19:28
Speaker 2: that's neither here nor there. Let's take a quick break.
19:31
Speaker 2: When we come back, we get the trivia answer in
19:33
Speaker 2: Wall Street.
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Speaker 1: here on the Financial Exchange Radio Network.
19:58
Speaker 4: Seeing another tech sell off day to close out the week,
20:01
Speaker 4: driven by global pullback in ship makers and ongoing worries
20:06
Speaker 4: about spending on AI. Right now, the Dow is down
20:10
Speaker 4: only forty points, SMP five hundred down nearly three quarters
20:14
Speaker 4: of one percent, sm excume me Nasdaq down by one
20:18
Speaker 4: point four percent, RUSS two thousand is down about half
20:20
Speaker 4: a percent. Ten Youre Treasreel down three basis points and
20:24
Speaker 4: is at four point five to three percent, and Oil
20:28
Speaker 4: up about three percent, trading at eighty one dollars a barrel.
20:31
Speaker 4: Alphabet down by two percent after Bloomberg reported that Google
20:34
Speaker 4: is months behind schedule on delivering its flagship AI model,
20:38
Speaker 4: Gemini three point five pro, as the company has been
20:42
Speaker 4: taking time to try to improve its capabilities. Meanwhile, Netflix
20:46
Speaker 4: shares a sinking eight percent after the streaming giant posted
20:49
Speaker 4: its weakest revenue growth in years in the second quarter.
20:52
Speaker 4: Netflix said it expects revenue and profit gains to slow
20:56
Speaker 4: in the current quarter. Elsewhere, SpaceX down by after it
21:01
Speaker 4: aborted the launch of its starship Mega Rocket due to
21:04
Speaker 4: some of the engines and arts starting. Elon Musk said
21:08
Speaker 4: the company will try again in the coming days, and
21:11
Speaker 4: with today's moves, Apple has overtaken in Vidia as the
21:15
Speaker 4: world's most valuable company, which in Vidia held that title
21:19
Speaker 4: since May of twenty twenty five. I'm Tucker Silva and
21:23
Speaker 4: that is Wall Street watching. In the previous segment, we
21:25
Speaker 4: asked you the Friday trivia question what is the name
21:28
Speaker 4: of the country that sits between Spain and France, And
21:31
Speaker 4: that would be and Dora and Patty and Rutland masses
21:35
Speaker 4: our winner today taking on the Financial Exchange Show t shirt.
21:38
Speaker 4: Congrats to Patty, she has won a Financial Exchange Show
21:42
Speaker 4: t shirt. See complete contest rules at Financial Exchange Show
21:46
Speaker 4: dot com.
21:47
Speaker 2: Mike, let's talk about this piece from market Watch, the
21:50
Speaker 2: unretirement Trap, how retirees can protect their golden years from inflation.
21:56
Speaker 2: This is a silly peace, Chuck, Okay, let's not talk
21:59
Speaker 2: about it. No, let's talk about it.
22:01
Speaker 5: But like they try and summarize all the ways that
22:05
Speaker 5: you can prepare for effectively not running out of money
22:09
Speaker 5: in retirement. And I'm not trying to, you know, do
22:12
Speaker 5: a disservice to any one of them. But the what
22:16
Speaker 5: you have to do is you have to expect the
22:18
Speaker 5: unexpected and be prepared and do some actual leg work.
22:22
Speaker 5: And no single list of four different items is going
22:25
Speaker 5: to get you there.
22:26
Speaker 3: If you're on the cusp of retirement.
22:28
Speaker 5: Yeah, I'd be really good if you could avoid big
22:30
Speaker 5: tax mistakes. You should plan to live longer, you should
22:33
Speaker 5: you know, be ready for higher inflation. But no list
22:38
Speaker 5: of four items is going to ensure that you will
22:41
Speaker 5: not run out of money or run the risk of
22:43
Speaker 5: running out of money in retirement. You have to do,
22:48
Speaker 5: if you want to feel self assured, some pretty comprehensive planning.
22:53
Speaker 3: I'm sorry, there is.
22:55
Speaker 5: Not a single rule, like the four percent rule that's
22:59
Speaker 5: going to get you there, because you know what, you
23:00
Speaker 5: could do everything on this list, Chuck, and then your
23:05
Speaker 5: spouse develops dementia and needs a lot of care later
23:08
Speaker 5: in life and all went.
23:09
Speaker 3: Out the window because you didn't prepare for that.
23:12
Speaker 2: Yeah, it's it's very much. Look, if you're trying to
23:16
Speaker 2: get prepared, We've talked about this a lot. If you're
23:18
Speaker 2: trying to prepare for retirement and and get your ducks
23:21
Speaker 2: in a row, you don't do that as you're on
23:24
Speaker 2: the cusp of retirement. You do it ten years before. Well,
23:29
Speaker 2: it's just how it is, like you and if you're
23:31
Speaker 2: you know, already within that window where you're getting closer,
23:33
Speaker 2: it's like okay, like every day that you, you know,
23:35
Speaker 2: can speed up that plan and getting in place is
23:39
Speaker 2: you know, additional time that you have to fix any
23:41
Speaker 2: problems before you finally get there. Yeah, but yeah, once
23:45
Speaker 2: you get there again, like it's not like you get
23:47
Speaker 2: to retirement like that that's it. But okay, like you
23:51
Speaker 2: have less time to adjust because now you're likely withdrawing
23:55
Speaker 2: from a portfolio at that point. Like you can still
23:58
Speaker 2: you know, tweak things, but it doesn't have It's like
24:01
Speaker 2: when we talk about the Social Security system. If we
24:04
Speaker 2: had fixed it fifteen years ago, you can do way
24:07
Speaker 2: smaller tweaks over a longer period of time and it'll
24:10
Speaker 2: end up in a good spot. If you wait until
24:12
Speaker 2: twenty thirty two to fix it, oh you're gonna have
24:14
Speaker 2: to do bigger changes and you're right up against it.
24:17
Speaker 2: So I think ultimately retirement is.
24:19
Speaker 3: Just like that.
24:20
Speaker 2: You plan in advance and then yeah, you've got to
24:23
Speaker 2: be able to adapt as things happen, because it never
24:26
Speaker 2: goes exactly according to plan. But the time to do
24:30
Speaker 2: retirement planning is not as you're entering retirement.
24:33
Speaker 3: It's ten to fifteen.
24:34
Speaker 5: Years before, whether you are planning it yourself, working with
24:37
Speaker 5: a professional, or just curious about getting started. In any case,
24:43
Speaker 5: you could use a second opinion if you'd like, one
24:45
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24:52
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24:56
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24:59
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25:01
Speaker 5: number again eight hundred three nine three four zero zero one,
25:05
Speaker 5: or you can check us out online at Armstrong Advisory
25:08
Speaker 5: dot com.
25:08
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
25:11
Speaker 1: registered investment advisor. Nothing in the ad or in any
25:13
Speaker 1: Armstrong guide a specific financial, legal, or tax advice. Consult
25:17
Speaker 1: your own financial, tax and to state planning advisors before
25:19
Speaker 1: making any investment decisions. Armstrong may contact you to offer
25:22
Speaker 1: investment advisory services.
25:24
Speaker 2: Piece in the Wall Street Journal, boomers were supposed to downsize,
25:27
Speaker 2: They're buying bigger homes instead. My parents did this at
25:30
Speaker 2: first when they retired.
25:31
Speaker 3: Actually, I find it's so funny.
25:33
Speaker 2: So like I grew up in like a twenty four
25:35
Speaker 2: hundred square foot home I think it was, And when
25:38
Speaker 2: my parents decided to move to North Carolina for about
25:41
Speaker 2: eight or nine years, they moved into one that was
25:43
Speaker 2: like five hundred square feet bigger, And I'm like, what
25:46
Speaker 2: are you guys doing?
25:47
Speaker 3: Like it's just the two of you, and what was
25:48
Speaker 3: their answer?
25:50
Speaker 2: They didn't give me like a good one. They were
25:51
Speaker 2: just like, well, this is the house that like we wanted.
25:53
Speaker 2: I'm like, okay, but like it wasn't like, oh we
25:58
Speaker 2: needed single four a living grew up in a ranch,
26:00
Speaker 2: like we had no second floor, So it wasn't like that.
26:04
Speaker 2: It wasn't It just was the house that they wanted.
26:08
Speaker 2: And I don't know, like they never gave me a
26:11
Speaker 2: good answer.
26:11
Speaker 3: Did they have regrets about it? No.
26:14
Speaker 2: The only reason that they moved out of that house
26:16
Speaker 2: eventually was they decided to move back up here from
26:19
Speaker 2: North Carolina. They're the one retiree that decided, Okay, this
26:22
Speaker 2: isn't for us, let's move back north. But no, they
26:25
Speaker 2: didn't have regrets about buying the house or anything. They
26:28
Speaker 2: were just like, yeah, we wanted to move back. Yeah
26:30
Speaker 2: we're seeing more and more of this and you know,
26:34
Speaker 2: and admittedly when they moved back, they did buy a
26:36
Speaker 2: small They went into a town home, which I think
26:38
Speaker 2: was the right thing.
26:39
Speaker 3: You know, it made more sense.
26:40
Speaker 5: So I guess my question, Chuck, like I do hear
26:44
Speaker 5: from retirees that they want a smaller home. Is this
26:48
Speaker 5: a chicken in the egg scenario, like there aren't a
26:50
Speaker 5: lot of smaller homes for sale. The builders aren't building
26:55
Speaker 5: smaller homes because they're not profitable, so the boomers can
26:59
Speaker 5: afford the bigger homes. The bigger homes are the only
27:02
Speaker 5: ones that are being built. Maybe they just have a
27:04
Speaker 5: lot of money and like newer stuff.
27:07
Speaker 3: That's probably fair that that might be it.
27:12
Speaker 2: You did see back a couple of years ago, you
27:14
Speaker 2: saw a little bit of a contraction in the average
27:18
Speaker 2: size of new construction. Yep, just because costs had gone
27:21
Speaker 2: up so much. Part of it is, Look, the cost
27:23
Speaker 2: of land is so high. Okay, if you are buying
27:27
Speaker 2: you know, land, and you're putting you know, the house
27:28
Speaker 2: on x number of acres, you know, at an eighth
27:31
Speaker 2: of an acre, a quarter or a third, Okay, Like
27:34
Speaker 2: there's only you can't justify like a two bedroom house
27:37
Speaker 2: with that price because the land is such a big,
27:40
Speaker 2: big cost. Now in construction costs and permitting are so high.
27:43
Speaker 2: It's it's tough to get there in a lot of cases.
27:45
Speaker 2: So it's it's hard to do small construction is is
27:50
Speaker 2: kind of what I.
27:51
Speaker 5: Unless it's going to be attached, and there's a lot
27:54
Speaker 5: of folks that find that unappealing. So there, that's kind
27:59
Speaker 5: of what we're landing with. Now, just take a quick break.
28:01
Speaker 5: When we return, let's do a little bit of stack
28:03
Speaker 5: Roulette next.
28:05
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29:24
Speaker 2: Mike, do you mind if I kick things off for
29:25
Speaker 2: stack Roulette. I actually have two stories I want to do.
29:28
Speaker 3: Hit it. Number one, I think we need to get
29:32
Speaker 3: rid of lettuce.
29:36
Speaker 4: It is kind of useless when you think about it.
29:38
Speaker 2: The only thing lettuce is good for is no not
29:44
Speaker 2: E coli in this case. This case, it's cyclosporiasis whatever
29:48
Speaker 2: that is. It says that it can cause explosive diarrhea
29:51
Speaker 2: and vomiting in the Wall Street Journal articles.
29:54
Speaker 5: So sounds like E coli look to be fair. Is
29:57
Speaker 5: that really different than the average Taco bells?
30:00
Speaker 2: Yes, Mike, Mike Michael, Michael Michael Michael, Michael Michael as
30:07
Speaker 2: a Taco Bell aficionado alcheck as someone who tried to
30:11
Speaker 2: stay in the Taco Bell hotel seven years ago. Uh,
30:16
Speaker 2: it is not the common experience, okay. Lettuce, on the
30:20
Speaker 2: other hand, like anytime that you hear about like, well,
30:23
Speaker 2: they found E coli somewhere.
30:24
Speaker 3: It is always the less going on with ten times
30:28
Speaker 3: it's the romaine and the other one.
30:30
Speaker 2: It's like, okay, it's like this other like branch of lettuce.
30:33
Speaker 2: But romaine in particular, along with tics, needs to be eradicated,
30:37
Speaker 2: Like just just get rid of both of them and
30:39
Speaker 2: and we'll be fine. Mosquitos too, No mosquitos, I don't,
30:42
Speaker 2: I don't mind, Like, oh yeah.
30:43
Speaker 4: Don't mosquitos.
30:44
Speaker 3: Yeah, they're great a mosquite.
30:46
Speaker 5: Like it if they're by the way, If there ever
30:49
Speaker 5: is a species that's going to take humans out, it's
30:52
Speaker 5: those tics.
30:52
Speaker 3: Man.
30:53
Speaker 4: Yeah, I got lyme disease twice, baby going for three?
30:56
Speaker 3: Does it cancel out?
30:58
Speaker 4: No, it just makes me more fu sorry to hear that.
31:02
Speaker 2: So Number one, we we got to get rid of
31:03
Speaker 2: the lettuce. I'm sorry, but we just we can't do it.
31:07
Speaker 2: It's it's it's it's not good.
31:09
Speaker 3: Number two.
31:11
Speaker 2: The Odyssey debuted yesterday as of right now on Rotten Tomatoes,
31:18
Speaker 2: and again like it's it's not early anymore. Like the
31:20
Speaker 2: movie's out ninety six percent from critics, ninety seven percent
31:25
Speaker 2: really from audience. So I have tickets for Monday in
31:29
Speaker 2: Providence on the seventy millimeter Imax, and I'm all kinds
31:32
Speaker 2: of excited for it.
31:34
Speaker 4: Group of my buddies went last night and they said
31:36
Speaker 4: they regretted going to the nine to thirty show just
31:39
Speaker 4: because of twice two hours and fifty minutes. I thought
31:42
Speaker 4: about going last night also, but they said it was
31:44
Speaker 4: good and they would not give me any more details. Yeah,
31:47
Speaker 4: I saw a there was a ten o'clock show and
31:49
Speaker 4: I was like, Eh, could I go like twice in
31:51
Speaker 4: a week?
31:52
Speaker 3: And I was like, no, they don't go ten o'clock
31:53
Speaker 3: you normally it's a sleep. Like two hours.
31:56
Speaker 5: Before that, I saw a fairly good Onion article of uh,
32:00
Speaker 5: Matt Damon defending his promotion of Duncan in the Odyssey
32:04
Speaker 5: and he's just going off to war carrying a box
32:06
Speaker 5: a box at Joe.
32:09
Speaker 2: But my question to both of you, so this obviously
32:13
Speaker 2: has like fantastic reviews on you know, Rotten Tomatoes and everything,
32:17
Speaker 2: what is the worst movie you've ever seen in theaters?
32:21
Speaker 4: Oh man? Speaking of Matt Damon, it was one with
32:26
Speaker 4: he and I think it was called The Good Prophet.
32:28
Speaker 4: I want to say it was somewhat de Niro, It
32:32
Speaker 4: was eye walked, it was I fell asleep during it
32:35
Speaker 4: The Good No, the Good Shepherd, That's what it was.
32:38
Speaker 4: It was two thousand and six and it was just awful.
32:41
Speaker 4: It was so bad. It was De Niro, Angelina, Joel Lee,
32:45
Speaker 4: Alec Baldwin, Joe Pesci, William Hurt, Matt Damon Cast. Oh
32:50
Speaker 4: my god, was it a bore.
32:52
Speaker 3: I don't have any looks like that was fifty on
32:55
Speaker 3: Rotten Tomato.
32:56
Speaker 4: Such a bore.
32:58
Speaker 2: The screen I Edward Wilson finds that the service in
33:02
Speaker 2: the OSS and later is a founding member of the CIA,
33:05
Speaker 2: is the perfect career for a man of his talents.
33:08
Speaker 2: My worst one might actually be one of the worst
33:10
Speaker 2: movies ever made. Battlefield Earth back in two thousand. Oh wow, Yeah,
33:15
Speaker 2: that's I was like a sci fi guy growing up
33:18
Speaker 2: in everything, so I was like, oh, like this sounds fine,
33:20
Speaker 2: Like you know, John Travolta.
33:21
Speaker 4: That's famous for being bad, not only bad.
33:24
Speaker 2: Tucker Rotten Tomatoes zero right three percent. Metacritic gave it
33:29
Speaker 2: a score of nine out of one hundred, and audience
33:32
Speaker 2: pulled by Audiences by Cinema Score gave it an average
33:35
Speaker 2: grade of D plus. It it performed terribly. It cost
33:41
Speaker 2: forty four million dollars, which in two thousand was like
33:44
Speaker 2: a decently sized movie. It only made twenty nine million
33:47
Speaker 2: dollars worldwide and honestly was just absolutely awful, despite having
33:56
Speaker 2: like a few, like pretty decent people in the cast,
33:59
Speaker 2: like you know it at Travolta towards the tail end
34:00
Speaker 2: of his career. Forrest Whittaker was in it, but like
34:03
Speaker 2: it just to be honest, like one of the worst
34:08
Speaker 2: movie experiences of my life, the worst.
34:10
Speaker 3: Like it was just awful.
34:13
Speaker 5: I want to talk about futures trading sites that are
34:17
Speaker 5: posing as gambling sites, that are just going off the
34:21
Speaker 5: rails at this point. So I'll be the first to
34:23
Speaker 5: admit that I was and still actually am, pretty comfortable
34:28
Speaker 5: with the idea of sports gambling being available and.
34:33
Speaker 3: Regulated.
34:34
Speaker 5: I do recognize, though, that I might just be off
34:36
Speaker 5: on this, and I see what it's doing to young
34:39
Speaker 5: people and the debt that they are going into. But
34:42
Speaker 5: the stuff that is happening on Calshi Polymarket and elsewhere
34:45
Speaker 5: is just getting out of control. So I think everyone
34:48
Speaker 5: saw the teleprompter guy for the White House, Yeah, being
34:55
Speaker 5: investigated by.
34:56
Speaker 3: Was it Calshi?
34:57
Speaker 5: Yes, he was making bets on and what the president
35:01
Speaker 5: of the two Yeah, he was making bets on what
35:03
Speaker 5: the president was going to see in his say, in
35:05
Speaker 5: his upcoming speech, which he got early access to, and
35:08
Speaker 5: so they verily, very easily identified who it was, what
35:12
Speaker 5: he was doing, and he made one hundred grand.
35:14
Speaker 3: Which how stupid do you have to? Like?
35:16
Speaker 5: How much do you make in that job? It's got
35:18
Speaker 5: to be a fair bit of money.
35:20
Speaker 2: I don't think it's very much. But do you think
35:22
Speaker 2: you're making a million dollars running the teleprompter?
35:25
Speaker 5: Of course not. But to only earn one hundred thousand
35:29
Speaker 5: dollars on these trades that you are making like that.
35:32
Speaker 3: Is just so stupid.
35:34
Speaker 5: But two, to allow someone to gamble on that, of
35:37
Speaker 5: course you're gonna get insiders. And now Calshi wants to
35:41
Speaker 5: come in for biopharma, allowing prediction markets for clinical trials
35:45
Speaker 5: and FDA approvals, which I wonder who's going to be
35:49
Speaker 5: betting on that stuff.
35:53
Speaker 3: This stuff is just way too vulnerable.
35:55
Speaker 5: To insider trading, and it is.
36:00
Speaker 3: Immensely problematic as far as I'm concerned.
36:02
Speaker 4: I'm seeing the high profile teleprompter job can pay as
36:06
Speaker 4: much as one hundred and seventy five thousand dollars a.
36:08
Speaker 5: Year, Yeah, which I can see why you're again in
36:12
Speaker 5: such a high power position. I can see why you're
36:14
Speaker 5: attempted to insider trade on that. But like, you gotta
36:18
Speaker 5: be you gotta be kidding me with this stuff.
36:20
Speaker 3: I don't why is that a high paying job? What
36:22
Speaker 3: do you have to do?
36:24
Speaker 5: Well, you need the highest level security clearance that there is.
36:28
Speaker 3: Okay, so there's that one. That's fine.
36:30
Speaker 4: Make sure there's no typo. Script pace pace is a
36:33
Speaker 4: big one. Well, no, you're not writing the speech, you're
36:37
Speaker 4: inserting it. Oh you're doing you copy paste? Do you
36:41
Speaker 4: what do you have to do? Control C, control V,
36:46
Speaker 4: too fast, too slow, seventy five thousand dollars for that?
36:49
Speaker 5: You do probably have to adapt to the speaker's pace,
36:53
Speaker 5: and especially in the presence case.
36:56
Speaker 3: Doesn't the prompter do that for you?
36:57
Speaker 4: No, No, you have to manually do that.
36:59
Speaker 5: Do you have to manually like roll the thing and
37:01
Speaker 5: think about how the president give speeches. He's constantly No,
37:04
Speaker 5: it's diverging from what's on that what's on that telepro.
37:07
Speaker 4: It's not like a window crank chuck. It's you just
37:10
Speaker 4: have to like I got.
37:11
Speaker 3: To catch up on Douck.
37:15
Speaker 2: It's jammed, Jimmy, get the oil, the gears are jammed
37:18
Speaker 2: and the prompter again.
37:19
Speaker 5: But again, we have gone way too far on the
37:23
Speaker 5: legalized gambling.
37:24
Speaker 3: How is that not an AI?
37:25
Speaker 2: Like, if there's any job you can AI, isn't it
37:27
Speaker 2: running a prompter?
37:28
Speaker 4: Probably?
37:29
Speaker 5: M Yeah, I'm not trying to a job or anything,
37:34
Speaker 5: but it just like, well, he kind of earned it.
37:36
Speaker 5: I'm trying to put him out of a job.
37:38
Speaker 2: Okay, there you go. Look, you know my thoughts on
37:41
Speaker 2: prediction markets. I would be the happiest personal live if
37:44
Speaker 2: they just went away. I don't think they're useful for anything.
37:48
Speaker 2: I don't think that they are particularly accurate because most
37:51
Speaker 2: of the time it's like three people trading like four
37:53
Speaker 2: hundred dollars between them. If that uh, and so I
37:57
Speaker 2: I just yeah, shut it down. I'm done with them.
38:01
Speaker 2: I'm I'm I'm done. Like we we did the experiment,
38:05
Speaker 2: it's not for us, but apparently we're still good with
38:08
Speaker 2: the lettuce too.
38:09
Speaker 3: So I guess, uh, we'll just go with it.
38:12
Speaker 2: We're gonna take a break for the entire weekend. I
38:14
Speaker 2: hope you all enjoy, hope the haze from the Canadian
38:18
Speaker 2: wildfires disperses, and we'll see you on Monday.