Latest / The Financial Exchange Show / Strong Indexes, Shaky Foundations: What’s Really Going On?

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Strong Indexes, Shaky Foundations: What’s Really Going On? · The Financial Exchange Show

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Speaker 1: donation today. This is the Financial Exchange with Chuck Zada,
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Speaker 1: and Mike Armstrong.
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Speaker 2: Mike, you ever watch TV?
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Speaker 3: I have bip.
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Speaker 2: You ever sit down on the couch.
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Speaker 3: And watch TV?
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Speaker 4: No?
1:18
Speaker 2: You ever sit down the couch?
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Speaker 4: Oh?
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Speaker 3: Yeah, yeah, both.
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Speaker 2: Okay. You're sitting on the couch and you're like, let
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Speaker 2: me pull up this app and see if I can
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Speaker 2: watch this, okay, and you're kind of like, Eh, there's
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Speaker 2: nothing really interesting there. I'm not really that's not really
1:34
Speaker 2: hitting it. Let me open up a different app and
1:37
Speaker 2: you go to a different streaming app and you're flipping
1:39
Speaker 2: through and you're like, no, I've seen that four times. No,
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Speaker 2: that doesn't look good. And you're flipping through and next
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Speaker 2: thing you know, you spent half an hour. You haven't
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Speaker 2: watched anything, but you've just kind of been going back
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Speaker 2: and forth. They're like, eh, maybe this maybe that, No,
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Speaker 2: I don't think. So that's today's market. We have crossed
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Speaker 2: from positive to negative territory five separate times already today
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Speaker 2: just up down, up, down, up, just back and forth.
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Speaker 2: Like this market it wants to do something. It just
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Speaker 2: doesn't know what it wants to do today, which I
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Speaker 2: guess is better than yesterday when it knew what it
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Speaker 2: wanted to do, and that was sell off pretty hard.
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Speaker 4: Right.
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Speaker 2: So today, as we sit here at this very moment,
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Speaker 2: and again we're we're minute to minute right now with
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Speaker 2: how this puppy's moving. The Dow Jones Industrial Average is up,
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Speaker 2: in fact, it's up one hundred and thirty nine points.
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Speaker 2: The standard in pores five hundred is up twenty five points,
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Speaker 2: the Nasdaq Composite is up forty four points. So you
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Speaker 2: got about a quarter to a third percent rally happening
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Speaker 2: in stocks. Not enough to make it yesterday's losses, but
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Speaker 2: we'll take gains over losses any day of the week,
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Speaker 2: unless you're a short seller, and then you're like, no,
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Speaker 2: I wanted to go down. But those are like the
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Speaker 2: people that show up to the casino and play on
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Speaker 2: the don't pass line on the UH, on the uh,
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Speaker 2: I'm totally blanking on the name right now. If you're
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Speaker 2: talking about spoils craps table, then no crapstaate, you're basically
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Speaker 2: betting the house there you go, snake eyes, No, well yes, yes,
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Speaker 2: so in any case, uh, this is what we have
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Speaker 2: going on in equity markets. The ten year Treasury continuates
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Speaker 2: migration down down four point two basis points to four
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Speaker 2: point h six two percent.
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Speaker 5: Uh.
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Speaker 2: This has brought mortgage rates in a little bit further
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Speaker 2: this year this week so far, thirty year fixed rate
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Speaker 2: according to Mortgage News Daily, now down to six point
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Speaker 2: one percent for the national average, so getting within sniffing
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Speaker 2: distance of six percent there. We've got other markets on
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Speaker 2: the move as well. Today, Dollar indexes up point one
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Speaker 2: four percent to ninety six ninety seven, gold is up
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Speaker 2: fifty five dollars nouns back above five thousand, five thousand
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Speaker 2: and three. On the nose, we've got crude oil down
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Speaker 2: thirteen cents a barrel to sixty two to seventy one,
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Speaker 2: triple a national average. For gas prices also coming in
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Speaker 2: four tens of percent to two ninety four. We've rallied
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Speaker 2: from about two eighty up to two ninety four. So
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Speaker 2: gas price is up about fourteen fifteen cents in the
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Speaker 2: last month, mostly on Middle East in Iran fears at
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Speaker 2: this point. And so that is what is moving markets today.
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Speaker 2: Let me tell you what's moving just about every person
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Speaker 2: online who is involved in business in any way, whether
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Speaker 2: you're an employer or an employer, whether you're you know,
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Speaker 2: a sole practitioner or not. Matt Schumer, who quite Honestly,
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Speaker 2: I don't know who Matt Schumer is. He's a dude.
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Speaker 3: CEO of some company that never has heard of. It's
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Speaker 3: fine of doesn't have a Wikipedia page. That's kind of
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Speaker 3: my benchmark, right, Matt Schumer is have a Wikipedia page.
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Speaker 2: He's a dude, and he works in the AI space,
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Speaker 2: and he on February ninth, about four days ago, wrote
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Speaker 2: a a post on x titled something Big is Happening.
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Speaker 6: Eighty million views.
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Speaker 2: It's got eighty million views, which is why I say,
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Speaker 2: like anyone involved in jobs is paying attention to this,
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Speaker 2: and the whole premise of something big is happening, it's
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Speaker 2: actually like when you print it out, it's like seven
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Speaker 2: or eight pages. It's long. It may have been like
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Speaker 2: partially or entirely written by AI, but I don't think
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Speaker 2: that matters. But basically what he says is, look, I've
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Speaker 2: noticed a change in what is going on in AI
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Speaker 2: right now and it's going to impact just about everyone, which,
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Speaker 2: by the way, feels like Matt might be listening to
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Speaker 2: our show because this is what we started saying last week.
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Speaker 2: So if he's a Financial Exchange listener, love your work, Matt,
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Speaker 2: and thanks for you know.
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Speaker 3: Do we want to read the piece about coding that
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Speaker 3: I found to be fascinating and just really compelling it
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Speaker 3: and really driving the last couple of years.
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Speaker 2: Here it is. I'll quote here, and hopefully this is
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Speaker 2: the same part that you picked out. Quote. I am
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Speaker 2: no longer needed for the actual technical work of my job.
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Speaker 2: I describe what I want built in plain English, and
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Speaker 2: it just appears not a rough draft. I need to
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Speaker 2: fix the finished thing. I tell the AI what I want.
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Speaker 2: I walk away from my computer for four hours and
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Speaker 2: come back to find the work done, done well, then
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Speaker 2: better done, better than I would have done it myself,
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Speaker 2: with no corrections need. A couple months ago, I was
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Speaker 2: going back and forth with the AI, guiding it and
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Speaker 2: making edits. Now I just described the outcome and leave.
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Speaker 2: So he's talking about, you know, coding to build apps
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Speaker 2: and programs and different things, and it goes He.
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Speaker 3: Then goes on, I think there's another part that's worth
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Speaker 3: talking about here, because I don't know how to design software,
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Speaker 3: no no idea. It goes further than that too. It
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Speaker 3: figures out the user flow, the design, all of it.
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Speaker 3: It does it. It writes tens of thousands of lines
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Speaker 3: of code then and This is the part that would
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Speaker 3: have been unthinkable a year ago. It opens the app itself,
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Speaker 3: It clicks through the buttons, It tests the features. It
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Speaker 3: uses the app the way a person would. If it
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Speaker 3: doesn't like how something looks or feels, it goes back
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Speaker 3: and changes it on its own. It iterates like a
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Speaker 3: developer would, fixing and refining until it's satisfied. Only once
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Speaker 3: it has decided the app meets its own standards, does
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Speaker 3: it come back to me and says it's ready for
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Speaker 3: you to test. And I test it. It's usually perfect.
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Speaker 2: The other piece that I'll read here and then we
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Speaker 2: can actually discuss more. But I tried AI and it
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Speaker 2: wasn't that good. People will say I hear this constantly,
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Speaker 2: and I understand it because it used to be true.
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Speaker 2: If you tried chat GPT in twenty twenty three or
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Speaker 2: early twenty four and thought this makes stuff up or
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Speaker 2: this isn't that impressive, you were right. The early versions
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Speaker 2: were genuinely limited. They hallucinated, They confidently said things that
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Speaker 2: were nonsense. That was two years ago in AI time.
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Speaker 2: That is ancient history. And one other addendum that I'll
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Speaker 2: point out. If you are using the free version of
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Speaker 2: AI you're not getting what this guy is is usually
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Speaker 2: either the paid versions are more advanced and further along.
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Speaker 2: So on this last one, which I think is the
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Speaker 2: most important one, the pace at which this is iterating
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Speaker 2: and changing is is so rapid. And the comparison that
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Speaker 2: I like to make here is if you decided that
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Speaker 2: you didn't want to fly on an airplane because you
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Speaker 2: saw like what the Wright brothers did. That's kind of
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Speaker 2: like saying, well, AI was bad two years ago, and
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Speaker 2: so I'm not gonna, you know, use it furthermore. And
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Speaker 2: this I think is made by this piece as well.
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Speaker 2: I've read so many of these in the last few
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Speaker 2: weeks that I don't know what's what. But when we
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Speaker 2: talk about using AI, we're not talking about like using
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Speaker 2: it like a search engine. Think about using it in
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Speaker 2: terms of can I build something to replace a part
8:21
Speaker 2: of my job or life that I genuinely dislike. So
8:25
Speaker 2: not hey, show me Chinese restaurants within two miles of
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Speaker 2: my house. You can use Google for that and it
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Speaker 2: might be better. Like that's not what we're talking about here,
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Speaker 2: Like you don't need AI to find Chinese restaurants. What
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Speaker 2: you could ask AI to do is build me instead
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Speaker 2: of doing this manually. Because you could do this manually.
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Speaker 2: You could say, locate all the Chinese restaurants within ten
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Speaker 2: miles of my house and then build me the route
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Speaker 2: map that is most efficient for getting to all of them,
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Speaker 2: so that I can try the fried rice at each
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Speaker 2: one and figure out which is better. And it will
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Speaker 2: go and be like, Okay, I need to access like
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Speaker 2: Google Maps API and do that, and here's the traffic
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Speaker 2: patterns at these times of day, and then it will
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Speaker 2: try a whole bunch of different things. Or you could say, hey,
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Speaker 2: I'm trying to figure out I just like got all
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Speaker 2: this smart home stuff installed. Build me automations that do X,
9:22
Speaker 2: Y and z for this automation app that I use,
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Speaker 2: and it will go and do that for you. Or
9:28
Speaker 2: if you're working, let's say that you are a lawyer, Hey,
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Speaker 2: here is the legal brief from the opposition. Figure out
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Speaker 2: how to poke holes in this for me. Have it
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Speaker 2: do that stuff for you instead of what's six times six?
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Speaker 2: Or make me a picture of a monkey and a
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Speaker 2: bob sled Like This is what I think people are
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Speaker 2: missing on AI is It's at the point now where
9:55
Speaker 2: if you ask it to do complex things again, you.
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Speaker 2: You have to do a lot of legwork to get
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Speaker 2: it to work the way that you want. What I
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Speaker 2: mean by that is there's a whole series of different
10:07
Speaker 2: prompts in different context that you have to give it
10:09
Speaker 2: as background. But once you learn how to do that,
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Speaker 2: I'm telling you it's and I have done a one
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Speaker 2: to eighty in the last month because of what I've seen,
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Speaker 2: It's coming for us sooner than people thought.
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Speaker 3: Another question about his experience Matt's experience specifically, is his
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Speaker 3: success with teaching it, is his success with having it
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Speaker 3: code things for him dependent on his pre existing expertise.
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Speaker 3: Since he already taught it how to do all these things,
10:38
Speaker 3: he already prompted it probably three hundred times that know,
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Speaker 3: this button doesn't work the way I want it to,
10:43
Speaker 3: this is the style I want, This is how I
10:45
Speaker 3: want it done. I wonder how many hours have gone
10:48
Speaker 3: into him training his AI system the way that he
10:51
Speaker 3: specifically needs it to work.
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Speaker 2: It is to a certain extent, but remember there are
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Speaker 2: thousands of other people with those skills that are doing
10:57
Speaker 2: the same thing. Yeah, and they're going to be enough
11:01
Speaker 2: where like you want to talk about potential roles that
11:04
Speaker 2: might exist over the next couple of years, like an
11:08
Speaker 2: AI trainer or builder for a company who's a consultant
11:11
Speaker 2: who comes in and does this stuff for a company
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Speaker 2: for like six months. Yeah, I can absolutely see that
11:17
Speaker 2: being a highly paid, transformative position for a period of time.
11:24
Speaker 2: Wild stuff that we're getting to, and I can't do
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Speaker 2: it all myself, but I see what people are doing now,
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Speaker 2: and I see how they're doing it, and my biggest
11:32
Speaker 2: thing is like, gee, I wish I had all of
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Speaker 2: these hours in the day to play around with it
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Speaker 2: myself in this fashion because I don't. But I see
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Speaker 2: what's being done and I'm like, oh, there's something there.
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Speaker 2: And I'm not just talking about how people write about it,
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Speaker 2: like you watch the actual videos that are being put
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Speaker 2: out of someone being like, hey do this AI, and
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Speaker 2: then you know, time lapses and shows you what it does,
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Speaker 2: and it's like, here's what it built.
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Speaker 3: Oh okay, I stay impressive.
12:00
Speaker 2: See it now, quick break here, when we come back,
12:02
Speaker 2: let's do trivia and then we're talking social security right
12:05
Speaker 2: after this.
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Speaker 6: time for trivia here on the Financial Exchange. In Sunday
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13:51
Speaker 2: Social Security could run out of money in just six years,
13:55
Speaker 2: even sooner than originally feared. So we're talking twenty thirty
14:00
Speaker 2: two now, Yeah, and Mike, when we're talking about midterm elections,
14:05
Speaker 2: do you ever hear social Security mentioned?
14:07
Speaker 3: Not yet?
14:08
Speaker 2: No. But here's the thing. The senators that are up
14:11
Speaker 2: for election this fall, they're gonna have to deal with this.
14:15
Speaker 2: So someone should be asking them about.
14:17
Speaker 3: It, I would think, so I'll ask them about it.
14:19
Speaker 2: According to new projections from the CBO, the Old Agent
14:22
Speaker 2: Survivors Insurance Trust Fund is now projected to run out
14:25
Speaker 2: of money in twenty thirty two. That's a year earlier
14:28
Speaker 2: than the estimate from last year. And actually it is
14:32
Speaker 2: on part though with the forecast that Social Security Chief
14:34
Speaker 2: Actuary Karen Glenn made in August.
14:38
Speaker 3: Is this in part due to the tax cuts most
14:41
Speaker 3: the One Big Beautiful Bill Act.
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Speaker 2: Glenn Head quote here. Glenn had said the provisions in
14:46
Speaker 2: last year's One Big Beautiful Bill Act, which included a
14:49
Speaker 2: temporary enhanced tax deduction for seniors, would have a material
14:52
Speaker 2: impact on the trust fund's finance.
14:54
Speaker 3: So if you're not remember how it was announced that
14:56
Speaker 3: there'd be no tax on Social Security. Didn't really get there.
14:59
Speaker 3: What we got instead was an additional deduction for those
15:01
Speaker 3: over the age of sixty five. But that does reduce
15:04
Speaker 3: overall taxation, especially on a lot of people social Security benefits,
15:09
Speaker 3: and so the benefits are less taxable, but the money
15:12
Speaker 3: will run out sooner.
15:13
Speaker 2: We're basically somewhere between six and seven years from this happening. Yep,
15:19
Speaker 2: do it. If you're sitting in your car, don't do it.
15:21
Speaker 2: But otherwise you can. You know, it's guys, it's coming,
15:27
Speaker 2: and no one wants to deal with it. And by
15:29
Speaker 2: the way, remember this is if everything goes well. Yeah,
15:33
Speaker 2: if you hit a recession, that it's a lot faster.
15:35
Speaker 2: If you hit a recession, it's faster because you have
15:36
Speaker 2: less payroll tax being collected. Yeah, and so like this
15:42
Speaker 2: is coming and no one is talking about it.
15:45
Speaker 3: And to be really clear, there is no path to
15:48
Speaker 3: this being resolved without changes to the program. Like if
15:52
Speaker 3: you're wondering, well, what if the economy gets really good, No,
15:55
Speaker 3: there's no means by which the economy can get so good.
15:58
Speaker 3: Or the only one that I could think of it,
16:01
Speaker 3: which it was too late to deal with, would be
16:04
Speaker 3: way more people that are like eighteen years old entering
16:08
Speaker 3: the country and getting jobs.
16:09
Speaker 2: Right, if you increase immigration by like six million eighteen
16:13
Speaker 2: year olds a year for the next five or six years,
16:18
Speaker 2: maybe it does something. I'm still not saying it thirty six,
16:21
Speaker 2: you know, like I don't even know if that does
16:23
Speaker 2: anything like meaningful. Still, just it's we're too late in
16:26
Speaker 2: the game. It's either gonna be we're just gonna change
16:29
Speaker 2: the rules and the trust fund doesn't have to be,
16:31
Speaker 2: you know, fully funded, we're just gonna pay it out
16:33
Speaker 2: of whatever, or it's going to be some combination of
16:38
Speaker 2: benefit cuts, tax hikes, and increase the age of the polease.
16:42
Speaker 3: Don't let your lotmakers get away with this. No one cares,
16:45
Speaker 3: no one, Like, no one talks about this. Yeah, nobody
16:49
Speaker 3: gives a darn it gives a hoot.
16:51
Speaker 2: Yeah, there's there's no hooton. There's no hooton. Let's see
16:55
Speaker 2: peace from barons. With stocks still riding high, now is
17:00
Speaker 2: the time to rebalance. Maybe maybe not okay, Like again,
17:04
Speaker 2: one size fits all financial advice is generally not great.
17:09
Speaker 3: Well, also because I love that we have an accompanying
17:11
Speaker 3: piece that is all about how having thirty three percent
17:14
Speaker 3: of your portfolio in seven companies is less risky than
17:17
Speaker 3: it sounds. So one of you, one of them is
17:20
Speaker 3: telling you sell everything, diversify more. The other one's telling
17:24
Speaker 3: you definitely don't diversify more.
17:28
Speaker 2: Here's the idea diversification. The whole premise of it is
17:32
Speaker 2: that not everything moves at the same rate, and so
17:34
Speaker 2: if you're well diversified, you won't do the worst out
17:37
Speaker 2: of any asset class, and you won't do the best diversification.
17:41
Speaker 2: I think a lot of people misunderstand. They're like, oh,
17:42
Speaker 2: if I diversify, like that's the best way to generate returns. No,
17:46
Speaker 2: diversification is the best way to reduce the spread in
17:51
Speaker 2: the variation of returns from year to year. But remember
17:55
Speaker 2: when there is a market crash, correlations increase, typically between
18:00
Speaker 2: US and international equities, US and commodities, real estate, like
18:04
Speaker 2: these correlations increase, you know, like it's it's just something
18:09
Speaker 2: that happens. So even during you know, very sharp downturns
18:13
Speaker 2: in markets, diversification doesn't necessarily save you. Then change movie.
18:18
Speaker 2: You know, having diversification between different asset classes can help sometimes.
18:23
Speaker 2: But the whole premise of diversification is if some of
18:26
Speaker 2: my stuff goes up, other stuff is going down, and
18:30
Speaker 2: if some goes down, some is going up, and so
18:31
Speaker 2: that should balance out and make it a less volatile
18:34
Speaker 2: ride over time, which can make it more tolerable to
18:38
Speaker 2: go through. But it doesn't inherently produce better returns.
18:42
Speaker 3: Yeah, not necessarily.
18:44
Speaker 2: And I don't know that there's ever a right or
18:46
Speaker 2: wrong time to diversify, Like just because stocks are up,
18:49
Speaker 2: it's not like do it now, Like I don't know,
18:52
Speaker 2: they could keep going up. Maybe now's not the right time.
18:55
Speaker 3: It's your February reminder that if one article that you
18:58
Speaker 3: read in any while your journal, Barons or otherwise place
19:01
Speaker 3: causes you to completely rethink your portfolio and you probably
19:05
Speaker 3: had the wrong portfolio begin with, take a walk and
19:07
Speaker 3: see if you still want to do it.
19:09
Speaker 2: Good idea quick break when we return We've got the
19:12
Speaker 2: trivia answer in Wall Street.
19:13
Speaker 7: Watch, bringing the latest financial news straight to your radio.
19:23
Speaker 7: Every day.
19:24
Speaker 1: It's the Financial Exchange on the Financial Exchange Radio Network.
19:29
Speaker 5: Time now for Wall Street Watch a complete look at
19:33
Speaker 5: what's moving markets so far today Right here on the
19:36
Speaker 5: Financial Exchange Radio.
19:37
Speaker 6: Network, markets are trading modestly. Hires. Wall Street reacts to
19:40
Speaker 6: the consumer Price Index for the month of January, where
19:44
Speaker 6: consumer prices climbed zero point two percent software than forecasts
19:48
Speaker 6: of zero point three percent. Traders are also continuing to
19:51
Speaker 6: weigh concerns around AI disruption, impacting various sectors, including real estate, trucking,
19:57
Speaker 6: in software. Right now, the Dow is of three to
19:59
Speaker 6: ten seven percent to one hundred and forty nine points,
20:02
Speaker 6: SMP five hundred, up about four tenths of a percent,
20:05
Speaker 6: Nasdaq is up only twenty eight points, about a tenth
20:08
Speaker 6: of a percent. Russell two thousand rallying one point seven percent.
20:12
Speaker 6: Ten year Treasure reeled down four basis points at four
20:15
Speaker 6: point zero five six percent, and crude oil down about
20:18
Speaker 6: a quarter percent, training its sixty two dollars and sixty
20:22
Speaker 6: seven cents a barrel. Applied Materials rallying nine percent after
20:25
Speaker 6: the maker of Semiconductor Equipment posted stronger than expected quarterly results,
20:30
Speaker 6: lifted by soaring demand for AI computing. Meanwhile, Instacart stock
20:35
Speaker 6: is soaring eight percent after the company's impressive quarterly results
20:38
Speaker 6: ease concerns over increasing competition and the grocery delivery market
20:43
Speaker 6: from the likes of Uber Eats, Amazon and door Dash.
20:46
Speaker 6: Elsewhere shares a roku or up about five percent after
20:50
Speaker 6: the video streaming company posted fourth quarter results that beat
20:53
Speaker 6: expectations and offered strong guidance. The company also said it
20:57
Speaker 6: expects to roll out premium subscription bundles the year yay
21:00
Speaker 6: More bundles and online travel agency Expedia posted solid quarterly results. However,
21:06
Speaker 6: the company identified emerging AI powered platforms as a potential risk.
21:11
Speaker 6: Expedia stock is now down over six percent. I'm Tucker
21:15
Speaker 6: Silva and that is Wall Street Watch. In the previous segment,
21:17
Speaker 6: we asked you the trivia question, which driver is one
21:20
Speaker 6: of the most Daytona five hundreds. Well that would be
21:23
Speaker 6: Richard Petty. He healds the record with seven Daytona five
21:27
Speaker 6: hundred victories. George from Wall Fame, Mass is our winner
21:30
Speaker 6: today taking on my Financial Exchange show T shirt. Congrats
21:33
Speaker 6: to George and we play trivia every day here on
21:36
Speaker 6: the Financial Exshane. See complete contest rules at Financial Exchange
21:39
Speaker 6: Show dot com.
21:41
Speaker 2: Either of you big Richard Petty fans?
21:44
Speaker 6: No, now, it was before my time.
21:46
Speaker 2: You guys know what his nickname is, the King Thuck King.
21:49
Speaker 6: You know what they've referred with the references in cars?
21:54
Speaker 2: Oh, yes, it's hang on the isn't just the King? Yes?
22:00
Speaker 2: But he because he plays one of the cars in
22:03
Speaker 2: Cars to I think it is or is it the
22:05
Speaker 2: car one?
22:06
Speaker 5: Yeah?
22:06
Speaker 2: Yeah, the og it's in the original. Yeah. Uh. Anyways,
22:11
Speaker 2: it's enough enough. H Richard Petty took King the King
22:15
Speaker 2: Weathers Strip Weathers. There you go.
22:18
Speaker 3: There you have it.
22:19
Speaker 2: Mike, you haven't said anything. I get the sentence. Apparently
22:22
Speaker 2: he's not a cars fan.
22:23
Speaker 6: You know nothing about cars nor a Nascar You don't
22:25
Speaker 6: what you've never seen the Pixar movie Cars.
22:27
Speaker 3: I have seen it once.
22:30
Speaker 2: Wow. You have three kids too?
22:31
Speaker 3: Yeah.
22:32
Speaker 2: Interesting, it's kind of shocking.
22:33
Speaker 3: Bunch of girls not that into cars.
22:35
Speaker 2: Yah, it's good. Everyone likes cars here. You what has
22:39
Speaker 2: surprised us most about retirement? That's the title of a
22:42
Speaker 2: piece today from the Wall Street Journal. And what has
22:47
Speaker 2: surprised people the most about retirement.
22:49
Speaker 3: I like this piece because it describes a phenomenon that
22:52
Speaker 3: we see all the time, which is oftentimes with a
22:56
Speaker 3: married couple that retire, one of them has a pretty
23:00
Speaker 3: experience than the other does not. And to me, what
23:03
Speaker 3: the lesson is from this, So it was a couple
23:06
Speaker 3: Steve and Karen. Karen seemed very fulfilled. Steve felt like
23:11
Speaker 3: there was just this well he talks about it a
23:13
Speaker 3: vacuum in what his work life previously took up. And here,
23:18
Speaker 3: I think is the best solution that you can come
23:21
Speaker 3: up with, which is talk about retirement with your family
23:26
Speaker 3: before well before you get there, and figure out your plan,
23:30
Speaker 3: because have things that you want to do, not like
23:32
Speaker 3: just you know, travel, like have things that you want
23:35
Speaker 3: to do every day, because otherwise Steve's experience here even
23:40
Speaker 3: he'd had plenty of things that he wanted to do
23:42
Speaker 3: and got fulfillment out of. But it seems to me
23:45
Speaker 3: that his experience, that vacuum that left avoid led to
23:49
Speaker 3: him experiencing this quote. Nothing prepared me for the gnawing
23:54
Speaker 3: unease of pivoting from saving to spending.
23:57
Speaker 2: And this I think is the biggest thing that I
23:59
Speaker 2: tend to hear, which is, for forty years going into retirement,
24:03
Speaker 2: it's max out your four oh one k, you know,
24:06
Speaker 2: save as much as you can. And then suddenly you
24:09
Speaker 2: turn sixty five or sixty seven or whatever age you
24:11
Speaker 2: turn when you retire, and some little young nerd like
24:15
Speaker 2: me walks in the room and is like, hey, it's
24:18
Speaker 2: time for you to start spending that money. And you're like, Chuck,
24:22
Speaker 2: are you insane? This is my retirement savings. And it's like, no,
24:26
Speaker 2: that's right, you're you're at Your retirement goes.
24:29
Speaker 3: Against every you know, yankee cheap, you know, saverer mentality
24:36
Speaker 3: that you have built up in your life, and it
24:39
Speaker 3: becomes a real problem for people, even in cases where
24:43
Speaker 3: they are fully financially prepared for retirement, that gnawing unease
24:46
Speaker 3: eats away at them at times. If first of all,
24:49
Speaker 3: if you're preparing for retirement, do what I said, talk
24:51
Speaker 3: about it. Figure out what your priorities are. Talk to
24:53
Speaker 3: your talk to your loved ones, talk to your spouse
24:55
Speaker 3: if you have one, and figure out what it's actually
24:57
Speaker 3: going to mean to you. If you who could use
25:02
Speaker 3: some help on the financial side of it, then that's
25:05
Speaker 3: where Armstrong can come in is talking through what those
25:08
Speaker 3: priorities are and then putting a price tag on them
25:11
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25:14
Speaker 3: through what the savings rate needs to be, how much
25:16
Speaker 3: you need to get to before you can pull that
25:18
Speaker 3: type of retirement off. But more often than not, that's
25:21
Speaker 3: what professional advisors are doing. Is not telling you whether
25:24
Speaker 3: or not you can retire, but explain to you what
25:26
Speaker 3: type of retirement you can afford. Number four Armstrong Advisor
25:29
Speaker 3: Groups eight hundred three nine three for zero zero one.
25:33
Speaker 3: You can book your free consultation by calling us. You
25:35
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25:38
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25:40
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25:44
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
25:47
Speaker 1: registered investment advisor. Nothing in the ad or in any
25:49
Speaker 1: Armstrong guide a specific financial, legal or tax advice. Consult
25:52
Speaker 1: your own financial tax into state planning advisors before making
25:55
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Speaker 1: advisory services.
26:00
Speaker 2: I know we got other stuff to talk about with
26:01
Speaker 2: you know, rising electricity costs and does anyone want to
26:04
Speaker 2: buy evs? Anymore. And uh, you know there's not enough
26:07
Speaker 2: cows in the US. But I got to talk about crabs.
26:12
Speaker 2: You do it piece in the New York Times crab
26:15
Speaker 2: Heist puts spotlight on surge of cargo thefts.
26:19
Speaker 1: Is nowhere.
26:19
Speaker 2: You're going there, going to the piece that you put
26:22
Speaker 2: in the stack? I remember, now, yep, that one I
26:27
Speaker 2: blocked that What happened?
26:28
Speaker 3: So this entire stack have no recollection.
26:30
Speaker 2: So here's the thing. Basically, like a bunch of scammers
26:33
Speaker 2: like hacked into the like email system of a cargo
26:36
Speaker 2: shipper and found a shipment of three hundred and twenty
26:41
Speaker 2: five dollars three hundred twenty five thousand dollars of frozen
26:44
Speaker 2: snow crab that was leaving a warehouse on July fifteenth
26:47
Speaker 2: in Worcestern, Massachusetts.
26:49
Speaker 3: How do you think you've got the network to unload
26:51
Speaker 3: three hundred and twenty five thousand dollars worth of snow crew?
26:53
Speaker 2: This is my question. Like if you go out and
26:56
Speaker 2: you steal TVs, it's like okay, like they don't go
27:00
Speaker 2: you can figure out a way to like unload them.
27:02
Speaker 2: I'm sure over a fixed period of time. If you've
27:05
Speaker 2: got a bunch of frozen snow crab. You have to
27:08
Speaker 2: do one of two things. You've got to get a
27:10
Speaker 2: giant freezer to put it in, which someone's gonna be like, hey,
27:13
Speaker 2: where'd all the snow crab come from? Dude or b
27:17
Speaker 2: You've got to sell it quickly. You can't just sit
27:20
Speaker 2: on You can't just be like you know all you
27:23
Speaker 2: know breaking bad where they get the storage unit, you're
27:25
Speaker 2: just sitting on the money like ooh, this is nice.
27:28
Speaker 2: You've got to figure out how to unload that. And
27:31
Speaker 2: I don't know anyone who's just like lurking around being
27:35
Speaker 2: like yeah, you know what I'd really like like I'd
27:38
Speaker 2: like like sixteen tons of stolen snow crab? Like what
27:43
Speaker 2: do you do with it?
27:44
Speaker 3: Lord of War with Nicholas Cage, Yes, remember the scene
27:48
Speaker 3: where he crashes the plane and he needs to get
27:50
Speaker 3: rid of all the weapons so he can't be proven guilty. Yeah,
27:52
Speaker 3: I'm just envisioning that, but with snow crab and it
27:55
Speaker 3: doesn't work, Like what what.
27:57
Speaker 2: Do you do with this? Go around to every buffet
27:59
Speaker 2: in the re just being like, hey, we can give
28:01
Speaker 2: you a half priced crab, Like no, they're can be
28:04
Speaker 2: like I've never met you You're not a normal distributor.
28:06
Speaker 2: Why would I buy from you.
28:07
Speaker 3: Yeah, either there's a bunch of rotten snow crab sitting
28:11
Speaker 3: around somewhere, or this heist was performed by, you know,
28:16
Speaker 3: the one percent of Americans who know how to deal
28:18
Speaker 3: with snow crab or frozen seafood generally.
28:22
Speaker 2: Again, because this is not an isolated thing. One of
28:25
Speaker 2: the biggest recent haulls was a truckload of processed lobster
28:28
Speaker 2: meet valued at four hundred thousand dollars. It disappeared in
28:32
Speaker 2: December after being picked up from a warehouse in Taunt, Massachusetts,
28:35
Speaker 2: never reaching the Costco wholesale locations in Illinois and Minnesota.
28:39
Speaker 2: There was another one where the lobster.
28:41
Speaker 6: Goes in this backyard. I mean it's been freaking freezing
28:43
Speaker 6: this whole time, just thrown on the snow.
28:45
Speaker 2: There you go. Remember the egg you know, call them
28:48
Speaker 2: snow crabs for no reason.
28:49
Speaker 3: There's the Pennsylvania egg heist too, Remember that one thereat
28:53
Speaker 3: thousand Hey oh no, sorry, yeah, one hundred thousand eggs
28:56
Speaker 3: in Pennsylvania.
28:57
Speaker 2: I mean that's even worse because like you break though
29:00
Speaker 2: and they're gone. Yeah, I just you can't put Humpty
29:03
Speaker 2: dumpty back together again.
29:05
Speaker 3: It's pretty fascinating that this stuff is happening.
29:08
Speaker 1: Backyards, just covered in lobster and crabs.
29:10
Speaker 2: This stuff has to the dog gonna go. It has
29:12
Speaker 2: to get shipped over seas, right, it's got to just
29:15
Speaker 2: a cargo boat like it.
29:17
Speaker 1: Yeah, it's gone.
29:18
Speaker 2: It has to get shipped over seas.
29:20
Speaker 3: If you are a a heist expert on frozen seafood,
29:26
Speaker 3: text the show at six one, seven, three, six, two
29:28
Speaker 3: thirteen eighty five. We want to know how you did it?
29:31
Speaker 2: Yes, in your location, one hundred and sixty thousand dollars
29:36
Speaker 2: of blueberries and kiwis those like I don't even now,
29:40
Speaker 2: that's ice blueberries. The blueberries you carry those the wrong way.
29:42
Speaker 2: They're all burn They're all like.
29:44
Speaker 6: Eight dollars four blueberries right now, right, we were still
29:47
Speaker 6: six blueberries for one hundred and sixty thousand dollars. So
29:51
Speaker 6: lock them up at the store like razors.
29:53
Speaker 2: They go back in a week like they're not even
29:55
Speaker 2: and you can't freeze them. You freeze them now you're
29:57
Speaker 2: talking about okay, it can only make smoothies with them,
30:01
Speaker 2: Like what are you doing with this stuff?
30:03
Speaker 3: Yeah? I am fascinated by this true.
30:05
Speaker 2: Is the market for black market food that big.
30:10
Speaker 3: We gotta find out. That's why I put out there
30:15
Speaker 3: can a I help with this. Let's take a quick
30:18
Speaker 3: break when Paul we know when we come back. PAULA
30:20
Speaker 3: Monica comes back with us right after this.
30:23
Speaker 5: Text does six one seven three six two one eight
30:26
Speaker 5: five with your comments and questions about today's show.
30:29
Speaker 1: This is the Financial Exchange Radio Network, Ladies and gentlemen
30:35
Speaker 1: the weekend.
30:45
Speaker 2: As promised, We're now joined by Paul Monica from Barons
30:50
Speaker 2: and uh we're talking a little bit about Hasbro today. Paul,
30:54
Speaker 2: how you doing good?
30:55
Speaker 4: Thanks? How you guys doing.
30:56
Speaker 2: We're doing well. How's Hasbro doing?
31:00
Speaker 8: Yeah, Hasbro is doing phenomenally well. The stock is at
31:05
Speaker 8: a multi year high. They reported earnings earlier this week,
31:10
Speaker 8: and there are a lot of things going well for
31:14
Speaker 8: the company. You've got strong growth from their Wizards of
31:19
Speaker 8: the Coast and digital gaming businesses. So that's things like
31:23
Speaker 8: the Magic the Gathering trading cards, Dungeons and Dragons, which
31:27
Speaker 8: is still going strong. Maybe it's getting a stranger things resurgence.
31:32
Speaker 8: And then also you know digital games like Monopoly Go
31:37
Speaker 8: and that is helping Hasbro report very strong results at
31:42
Speaker 8: a time where its top rival Mattel is struggling. That
31:46
Speaker 8: stock plunged after it also reported earnings because you know,
31:51
Speaker 8: they're you know, getting hit by just weaker demand for
31:55
Speaker 8: their toys, things like Barbie and hot Wheels. And they
31:58
Speaker 8: also have more overseas production exposure I think than Hasbro,
32:02
Speaker 8: so tariffs are a bigger concern than they are for Hasbro,
32:05
Speaker 8: which also doesn't get as much of a tariff hit
32:08
Speaker 8: on some of the digital side of their businesses.
32:11
Speaker 2: So Hasbro for the last decade or so, up until
32:14
Speaker 2: the last year, was basically just chopping around and not
32:17
Speaker 2: really going anywhere. Is there something fundamentally different that's changing
32:22
Speaker 2: the long term outlook for the business or are we
32:25
Speaker 2: just kind of on the upswing of one of those
32:27
Speaker 2: positive chops and there's another shoe waiting to fall, waitting
32:30
Speaker 2: to drop on the other side of it.
32:32
Speaker 8: Yeah, that's a good question, man. I think you have
32:35
Speaker 8: a new Ish CEO. You know, he's been there a
32:37
Speaker 8: couple of years now, Chris Cox. He has made a lot.
32:42
Speaker 4: Of changes at the company for the better.
32:44
Speaker 8: But also keep in mind that you're right, Hasbro and Mattel,
32:49
Speaker 8: they're both in businesses that are somewhat fickle and also
32:54
Speaker 8: hit driven and fad and trend driven, and right now
32:59
Speaker 8: has b has the momentum that maybe Mattel had a
33:02
Speaker 8: couple of years ago when the Barbie movie was such
33:04
Speaker 8: a phenomenon that helped Mattel. Now you look at Hasbro,
33:09
Speaker 8: They've got that longstanding Disney relationship, which could give them
33:15
Speaker 8: a big boost this year.
33:17
Speaker 4: You've got Toy Story.
33:18
Speaker 8: Five coming out, You've got the Mandalorian.
33:21
Speaker 4: And Grogu movie.
33:23
Speaker 8: That's a lot of Baby Yoda toys. There are two
33:25
Speaker 8: Marvel movies with another Spider Man and an Avengers movie
33:29
Speaker 8: coming out. And then Hasbro's doing more deals on the
33:31
Speaker 8: licensing side as well.
33:33
Speaker 4: They've got toys tied.
33:35
Speaker 8: To the Voltron movie from Amazon's MGM Unit, so that'll
33:39
Speaker 8: stream on prime video later this year. So again, you're
33:44
Speaker 8: all right that, you know, you have to be somewhat
33:48
Speaker 8: lucky in some respects because you're riding hot trends that
33:53
Speaker 8: are a little bit out of your control. But Hasbro
33:56
Speaker 8: has those solid relationships right now, and that's giving them
33:59
Speaker 8: a boost.
34:01
Speaker 2: When we look at the last couple of weeks, uh,
34:04
Speaker 2: you know, basically anywhere in the market, the chatter has
34:06
Speaker 2: been about how can AI potentially replace her up end
34:11
Speaker 2: this business, And it seems that when we talk about
34:13
Speaker 2: some of the digital stuff that has Bro's building, the
34:16
Speaker 2: mode that they're trying to build is people will still
34:19
Speaker 2: want to play these familiar digital games instead of new
34:22
Speaker 2: ones that could be easily built. Is that a fair
34:25
Speaker 2: statement looking at them?
34:27
Speaker 3: Yeah?
34:27
Speaker 4: I think it is.
34:28
Speaker 8: I mean you've got some legacy brands with Dungeons and
34:32
Speaker 8: Dragons and Magical Gathering, a little bit of a newer
34:35
Speaker 8: one of course, you know the Monopoly board game that
34:38
Speaker 8: has the digital aspect as well. They're probably less susceptible
34:44
Speaker 8: to AI offending their business.
34:47
Speaker 4: You know.
34:48
Speaker 8: AI is obviously, you know, going to be very disruptive
34:52
Speaker 8: for a lot of services companies. But you know, there
34:55
Speaker 8: has been this trend this week, companies like McDonald's and
34:59
Speaker 8: young Brands our new all time highs.
35:01
Speaker 4: Thanks to solid results.
35:02
Speaker 8: AI is great, but if you want a big Mac
35:05
Speaker 8: or you know, pizza from Pizza Hut, you know, CHATCHBT
35:09
Speaker 8: and Claude really can't help you there. So I think
35:12
Speaker 8: that you know, investing in the real, the physical and
35:15
Speaker 8: the tangible, that's going to be a trend that will
35:18
Speaker 8: continue in that.
35:19
Speaker 4: Obviously good news for Hasbro.
35:21
Speaker 2: Fantastic. Paul, appreciate you joining us. Hope you have a
35:24
Speaker 2: great weekend and we will catch up with you soon.
35:27
Speaker 4: Thanks a lot. I have a go on, guys.
35:29
Speaker 2: It's Paul Monica from Baron's talking about Hasbro. Mike, I
35:32
Speaker 2: want to talk about the S and P five hundred briefly.
35:35
Speaker 2: If you'll indulge me, let's do it. The S and
35:37
Speaker 2: P five hundred right now is at sixty eight sixty seven.
35:44
Speaker 2: It was also at sixty eight sixty seven on October
35:47
Speaker 2: twenty seventh, which means we're now closing in on four
35:52
Speaker 2: months with the stock market basically not going anywhere, and
35:58
Speaker 2: it's really is insurn but not having gone anywhere. So
36:01
Speaker 2: the remarkable thing is that under the surface there is
36:05
Speaker 2: as much churn as we have ever seen in markets,
36:08
Speaker 2: and yet they're somehow holding up because normally, with this
36:12
Speaker 2: level of movement, you've got indices off like anywhere from
36:16
Speaker 2: like ten to twenty five percent, and it's not happening here.
36:19
Speaker 2: And it's basically because no one wants to outright sell
36:23
Speaker 2: stocks in the aggregate right now. It's kind of well,
36:26
Speaker 2: my software stuff is getting blown up, so I'm gonna
36:28
Speaker 2: move to consumer staples, and then that gets blown up,
36:32
Speaker 2: so I'm gonna move to financial Like everyone's just kind
36:34
Speaker 2: of moving around. But at some point this market is
36:39
Speaker 2: like things are getting pretty stressed under the surface, and
36:43
Speaker 2: it's a fairly dangerous market right now, just because the
36:47
Speaker 2: mechanics are just a mess under the hood.
36:50
Speaker 3: Yeah, everybody's been talking about that great rotation, and we
36:53
Speaker 3: are seeing some rotation in twenty twenty six thus far.
36:57
Speaker 3: But can it continue to support the over for all
37:01
Speaker 3: price level is pretty important.
37:05
Speaker 2: It's basically the only question that matters right now, just
37:09
Speaker 2: because again, what's happening under the surface is so intense
37:16
Speaker 2: in terms of like names moving you know, seven to
37:18
Speaker 2: ten percent a day, but somehow not affecting the broader market.
37:22
Speaker 2: It's not something that we normally see in this fashion.
37:27
Speaker 2: But hey, we'll see how long. If it can hold
37:31
Speaker 2: together long enough in order to you know, kind of
37:34
Speaker 2: let some of the bigger players get back on track,
37:36
Speaker 2: then you know, that's that's kind of your exit path.
37:38
Speaker 1: I think let's.
37:39
Speaker 2: Take a quick break for the entire weekend. Hope you
37:42
Speaker 2: all have a great presence day weekend, and we will
37:44
Speaker 2: see you back here next week.