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How to trade the trade war...don't · The Financial Exchange Show

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Speaker 1: Armstrong and Mark Vandetti.
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Speaker 2: Good morning, Welcome back to the Financial Exchange. Our top
1:15
Speaker 2: story today continues to be earnings that have been reporting
1:19
Speaker 2: all throughout the week. Yesterday after the bell, we heard
1:22
Speaker 2: from Nova, Nordes, Toyota, Baba, Ali Baba, Walt Disney Company. Yeah,
1:28
Speaker 2: that was yesterday as well Qualcom arm Holdings. This morning
1:33
Speaker 2: before the bell, we heard from Eli Lilly, AstraZeneca, Phillip,
1:37
Speaker 2: Morris International, Honeywell, Bristol Myers, Squab, Conico, Phillips, among many others.
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Speaker 2: And then today after the bell, we will hear from
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Speaker 2: Amazon on their earnings, the two and a half trillion
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Speaker 2: dollar behemoth out there. Tomorrow, we'll see a jobs report released.
1:50
Speaker 2: It'll be a unique one because every once in a
1:52
Speaker 2: while they go back and do revisions for the previous
1:55
Speaker 2: several months, and so we will not only get a
1:58
Speaker 2: read on January's labor market, but also so get a
2:00
Speaker 2: more accurate read on what the state of the jobs
2:03
Speaker 2: market was over the course of the last year. This
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Speaker 2: morning markets mixed, Dow off ninety eight points, or a
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Speaker 2: fifth of one percent, the S and P up about
2:11
Speaker 2: a tenth of a percent in the Nasdaq doing about
2:13
Speaker 2: the same not much in the way of a move
2:15
Speaker 2: on interest rates up on the ten year to four
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Speaker 2: point four to three six percent, price of oil moving
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Speaker 2: up slightly only to seventy one dollars and thirty six cents.
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Speaker 2: That brings us to the national average gas price, which
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Speaker 2: as of today we are sitting at three dollars and
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Speaker 2: fourteen cents. I'll say that I was up in New
2:37
Speaker 2: Hampshire yesterday, so I got to fill up my tiny
2:40
Speaker 2: gas tank at a nice price of below two to
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Speaker 2: seventy gallons. That was That was nice feeling, but nonetheless
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Speaker 2: not a huge volatile day on market so far today,
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Speaker 2: in spite of what was a volatile week for news
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Speaker 2: anyway in terms of the market move relatively muted on Monday,
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Speaker 2: but we had the announcement of new tariffs going into
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Speaker 2: place over the weekend, the assumption that they would be
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Speaker 2: in place on Monday morning, followed by the very rapid
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Speaker 2: suspension of tariffs on Mexico and Canada in position of
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Speaker 2: tariffs in China, and yet markets haven't moved all that much,
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Speaker 2: and brings us to this piece from the Financial Times, Yes,
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Speaker 2: the Financial Times, how to trade the trade war? And
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Speaker 2: I think my answer is unless you are in Donald
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Speaker 2: Trump's inner circle and know what the trade war is
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Speaker 2: going to look like, then don't.
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Speaker 3: Or even if you are, I don't know if any
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Speaker 3: of them.
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Speaker 2: Though, Yeah, I mean, I don't know if he knows, right,
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Speaker 2: and he would probably concede that. Yeah, you know, hey,
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Speaker 2: it is really really difficult to know all of this stuff.
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Speaker 2: How to trade the trade war. I mean, look, I
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Speaker 2: just don't think I would treat it any differently than
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Speaker 2: any other unknown risk that we have talked about in
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Speaker 2: terms of geopolitics over the course of the last several decades.
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Speaker 2: You don't know how it will play out. You can't
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Speaker 2: perhaps perceive how it will affect markets. You can have
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Speaker 2: some you know, pre planned actions to take once you
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Speaker 2: know certain things, but until that's clear, and even once
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Speaker 2: it is clear, you just don't know if it could
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Speaker 2: be suspended or changed at the eleventh hour. And so
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Speaker 2: I think it's very difficult for anyone to say that
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Speaker 2: they are going to be able to successfully trade the
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Speaker 2: trade war risk that's out there right now now.
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Speaker 4: Any kind of volatility. We talk about this a lot internally.
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Speaker 4: When swings amplify, when turmoil picks up, that's generally bad
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Speaker 4: for returns. The best return years are the lowest volatility.
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Speaker 4: Your volatility is just a fancy way of describing the
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Speaker 4: spread around the average. The bigger the spread, the more
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Speaker 4: something swinging. Maybe for the term standard deviation, that's what
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Speaker 4: that That's how people in finance measure risk. When they
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Speaker 4: say volatility, they mean the same thing. Is standard deviation
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Speaker 4: or risk. You can use all those things synonymously. In fact,
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Speaker 4: is volatility went up a bit. I'm looking at rolling
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Speaker 4: three and five day risk mic based on our off
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Speaker 4: air conversation and went up a bit at the end
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Speaker 4: of last week, but has since moderated and doesn't If
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Speaker 4: you looked at a chart of volatility, you couldn't pick
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Speaker 4: out the most recent episode as coinciding with anything special
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Speaker 4: having happened. But generally speaking, volatility is bad. And if
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Speaker 4: we're in for a four year roller coaster ride of
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Speaker 4: one day it's a trade war, the next day we're
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Speaker 4: taking over guys at a build hotels and there's acrimony
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Speaker 4: over that internationally and domestically, and the next day we're
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Speaker 4: going to be invading Panama for the second time in
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Speaker 4: the last forty years. This is probably not good for certainty.
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Speaker 4: If you like and probably a drag on equity returns.
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Speaker 4: They may still be high, but this doesn't help them.
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Speaker 2: So when we speak about volatility, it's not necessarily just
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Speaker 2: to the downside, right, I mean when you speak about volatility, no,
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Speaker 2: it's literally the spread, the spread, it's how big the
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Speaker 2: moves are on a you choose basis day to day, basis,
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Speaker 2: week to week, month, month, quarter to quarter, year to year,
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Speaker 2: whatever it costs specific it's it's the moves up and down.
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Speaker 3: That's right.
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Speaker 2: Generally speaking, Well, I think most people recognize that volatility
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Speaker 2: more than often than not means bad things. But statistically
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Speaker 2: we can actually prove that out too, Right, Volatile markets
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Speaker 2: are not usually they tend to be on average, tend
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Speaker 2: to be yah.
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Speaker 4: So differently they're they're they're inversely i e. Moving the
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Speaker 4: opposite direction correlated. So the higher the volatility, the lower
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Speaker 4: the returns over thirty days, twelve months, virtually, whatever period
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Speaker 4: you want to look at. It sounds like volatility should
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Speaker 4: be kind of neutral. Well, I like the upside volatility.
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Speaker 4: The fact is, when those swings get more intense, it
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Speaker 4: coincides with big down turns as as well as potentially
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Speaker 4: sizeable upswings and on average, it's it's bad. You want
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Speaker 4: it's bad in the sense that you get lower and
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Speaker 4: average returns.
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Speaker 3: You want calm market.
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Speaker 2: And is it fair to say that twenty twenty three
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Speaker 2: and twenty twenty four were not.
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Speaker 4: Long, they were low volatile no matter how you look
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Speaker 4: at at that standard deviation or risk that I mentioned,
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Speaker 4: number of days when returns were sometimes I show this internally,
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Speaker 4: number of days when returns were lower than negative one percent,
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Speaker 4: lower than negative two percent by any measure. Markets were
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Speaker 4: unusually placid in those years, and another years like twenty nineteen,
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Speaker 4: those are high return years.
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Speaker 2: Those points confuse people sometimes because people fail to accurately
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Speaker 2: look at percentages, and we also have a bias towards
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Speaker 2: remembering the big swings. There's a few things that play
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Speaker 2: into this, but I think it's important to make that
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Speaker 2: point that twenty twenty three and twenty twenty four were
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Speaker 2: actually historically low volatility years in spite of the fact
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Speaker 2: they were those days that you saw. And I think
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Speaker 2: it largely has to do with where the Doo is today,
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Speaker 2: because people have that set in their mind is, oh
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Speaker 2: my god, the Dow is swinging eighty points. That must
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Speaker 2: mean that markets are going through well. No. Eighty points
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Speaker 2: these days is one fifth of one percent, and people
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Speaker 2: fail to make that recognition. But I think it is
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Speaker 2: an important point that yes, stocks did really well over
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Speaker 2: the course the last two years and were historically not
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Speaker 2: volatile during those two years. Since self interested article of
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Speaker 2: the week perhaps here from CNBC in interview with Lisa Schalet,
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Speaker 2: who I didn't know her, but she's the chief investment
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Speaker 2: officer at Morgan Stanley Wealth Management, and she's arguing that
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Speaker 2: you need to rethink your set it and forget it
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Speaker 2: strategy in twenty twenty five. There's not many people that
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Speaker 2: I can think of who would benefit from more people saying, Hey,
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Speaker 2: I need to be nervous about my portfolio and do
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Speaker 2: away with a set it and forget it strategy and
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Speaker 2: instead go hire a professional manager. The chief investment officer
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Speaker 2: of one of the largest wealth management firms in the
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Speaker 2: world would seemingly benefit from that. I'm usually doubtful of
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Speaker 2: anyone that is telling me that I need to completely
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Speaker 2: reverse course on my investment strategy of set it and
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Speaker 2: forget it and employ a new strategy because because of
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Speaker 2: some new risk out there. Mark, I don't know what
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Speaker 2: your takeaway is, but my takeaway would be we don't
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Speaker 2: know that twenty twenty five is going to be more volatile,
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Speaker 2: and we also don't know that any investment managers are
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Speaker 2: going to be better at dealing with that volatility than
9:14
Speaker 2: just keeping the way things were before. So my words
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Speaker 2: of warning here are don't let scary news articles sway
9:22
Speaker 2: your strategy. Always you should be taking a look at
9:26
Speaker 2: your strategy and seeing if it lines up with your
9:28
Speaker 2: longer term goals. But just because this president's talking more
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Speaker 2: about tariffs and more about big geopolitical policy shifts, doesn't
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Speaker 2: mean that it necessitates a massive undertaking and shift of
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Speaker 2: your total investments.
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Speaker 4: Look, the defining feature of US economic growth and as
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Speaker 4: a result, stock market growth is the steady upward climb
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Speaker 4: over say the last century, for period for which we
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Speaker 4: have really good data, and by that I mean a
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Speaker 4: reliably positive rate compound. You see this in the GDP
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Speaker 4: series that we talk about a lot. It's just a
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Speaker 4: nice upward sloping line. Recessions if you pull back from
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Speaker 4: the page a foot, you can't even pick them out
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Speaker 4: of the series. Similarly, stocks, most of the declines are fleeting,
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Speaker 4: some of them are sharp and uncomfortable, but most are fleeting.
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Speaker 4: The point I'm trying to make here is policies were
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Speaker 4: very different at different points in time along those series,
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Speaker 4: but those differences had very little persistent or permanent if
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Speaker 4: you like impact, It could be different this time. This
10:33
Speaker 4: administration could break something. I tend to think that they won't, though,
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Speaker 4: so look past it, and as you always counsel your clients,
10:41
Speaker 4: might let your long term goals and tolerance for risk
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Speaker 4: decide your investment strategy, not what you think a particular
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Speaker 4: political party in power might imply. For the very short
10:53
Speaker 4: term and a long term, these things are really just blips.
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Speaker 2: Let's take a quick break. When we come back, Corey
10:58
Speaker 2: Adams joining us from Robert Half their Newest Job survey.
11:02
Speaker 2: When it comes to job switching, that's next here on
11:05
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Speaker 5: This segment of the Financial Exchange is brought to you
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Speaker 2: Joining us now is Corey Adams from Robert Half talking
12:21
Speaker 2: to us about the latest survey of findings they did
12:24
Speaker 2: on more than two thousand workers. Corey, thanks for joining us.
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Speaker 6: Good morning, Mike, Thanks for having me.
12:29
Speaker 2: Before we get started on your findings, anything to take
12:32
Speaker 2: away from Tuesday's JOLT report or anything in particular you're
12:35
Speaker 2: looking for out of tomorrow's monthly jobs report release.
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Speaker 6: Sure, So I think let's start with this as relates
12:43
Speaker 6: to the jeweltryport. So hiring has stabilized, it hasn't stalled,
12:49
Speaker 6: so the labor market continues to hold steady even as
12:52
Speaker 6: these job openings are decreasing. So to your point, the
12:57
Speaker 6: JOULT report came out yesterday seven point six million job openings,
13:01
Speaker 6: a drop quite a bit of a drop from the
13:03
Speaker 6: eight point one that we saw in the previous report.
13:06
Speaker 6: So this is indicating a gradual slowdown rather than a
13:10
Speaker 6: sharp downturn, which obviously nobody wants. It's important note as
13:13
Speaker 6: well that layoff levels remain relatively unchanged, so for me,
13:17
Speaker 6: it's somewhat reinforces that employer confidence is there in terms
13:22
Speaker 6: of retaining talents.
13:23
Speaker 2: Can you share the trends you're seeing from your own
13:26
Speaker 2: surveys that are really affecting job seekers in twenty twenty five.
13:30
Speaker 2: I've spoken to a few soon to be college grads,
13:33
Speaker 2: for example, who are finding it to be a bit
13:35
Speaker 2: more of a struggle than previous years. What are you
13:37
Speaker 2: seeing in your survey data. Sure.
13:39
Speaker 6: So from the Robert Half Job Optimism research, it actually
13:43
Speaker 6: highlights four key trends for twenty twenty five. So the
13:47
Speaker 6: first one is career satisfaction continues, so eighty one percent
13:51
Speaker 6: of workers stated that they're generally happy in their current role,
13:54
Speaker 6: which is great to hear. Now, this career satisfaction trend
13:57
Speaker 6: leads to the second trend, which is leading to a
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Speaker 6: fewer workers actually planning to do a job search. So
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Speaker 6: only twenty nine percent of workers plan to look for
14:06
Speaker 6: or plan to execute a job hunt early in twenty
14:09
Speaker 6: twenty five, and that's important to note that's down from
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Speaker 6: thirty five percent from the same time we asked that
14:14
Speaker 6: question in July twenty twenty four. The third trend is
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Speaker 6: that Gen Z and millennials are most likely to actually
14:22
Speaker 6: make a career move in the first half of this year,
14:24
Speaker 6: and the top motivator for younger professionals is an increase
14:28
Speaker 6: in their salary. And then the fourth trend is upscaling,
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Speaker 6: which we talked about quite a bit, but upskilling is
14:34
Speaker 6: boosting worker confidence, with seventy seven percent of workers citing
14:37
Speaker 6: that they've learned a new skill in the last year.
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Speaker 2: Speaking of new skills that everybody wants to talk about AI.
14:43
Speaker 2: What role is artificial intelligence now playing in the job search?
14:46
Speaker 2: For those who have been out of a job search
14:49
Speaker 2: for a while.
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Speaker 6: So AI can help streamline the hiring process by matching
14:53
Speaker 6: job seekers with roles based on skills and experience, making
14:57
Speaker 6: job searches faster and in theory, should be more efficient. However,
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Speaker 6: an over reliance on AI can actually lead to missed
15:05
Speaker 6: opportunities if workers are not customizing their job search to
15:09
Speaker 6: each unique opportunity and then likewise listen. Employers also have
15:14
Speaker 6: to balance AI tools with human insight to ensure a
15:17
Speaker 6: fair and holistic hiring process.
15:19
Speaker 2: Give me a sense any tips for those looking for
15:23
Speaker 2: a career change or maybe entering the labor market come
15:26
Speaker 2: May of this year May or June of this year,
15:28
Speaker 2: or looking to make a career change now.
15:31
Speaker 6: Yeah, I do so. First, most important, be clear about
15:34
Speaker 6: what you want in your next role, whether it be flexibility,
15:38
Speaker 6: career growth, a better work culture, more money, whatever it is.
15:41
Speaker 6: Make sure you know what it is and make sure
15:43
Speaker 6: you're clear about it. Next, I would say upscale and
15:47
Speaker 6: rescale to align with emerging trends and roles. This will
15:50
Speaker 6: set you apart from other applicants, and we know it's
15:53
Speaker 6: going to be a competitive job markets, so you're going
15:55
Speaker 6: to want to do that this year. And then finally,
15:58
Speaker 6: and we talk about this one a ton, it's so important,
16:01
Speaker 6: but tailor your resume and LinkedIn profile to highlight your
16:05
Speaker 6: accomplishments and transferable skills, so that way you're making it
16:09
Speaker 6: easy for employers to see your value as a potential
16:12
Speaker 6: employee at some point in the future.
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Speaker 2: Is it a good time for an employer to look
16:17
Speaker 2: for new workers? I know you know a lot of
16:19
Speaker 2: complaint about a stagnant job market. Is it therefore, you know,
16:22
Speaker 2: easy for employers to find that new highly talented individual
16:24
Speaker 2: or are they just not moving?
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Speaker 6: It depends. I think some markets you're seeing more of
16:30
Speaker 6: a movement than others. You know, we know that some
16:32
Speaker 6: of the key factors for why people are so happy
16:35
Speaker 6: as they've got competitive salaries with regular merit increases. People
16:40
Speaker 6: are saying that they have fair workloads and their pretty
16:43
Speaker 6: clear job expectation, so they know what they're supposed to
16:46
Speaker 6: do when they're supposed to do it. And people feel like,
16:48
Speaker 6: and this is coming around a lot, they have a
16:50
Speaker 6: really positive work culture. So it's tough. You know, workers
16:53
Speaker 6: are happy, but you know, in a separate survey that
16:55
Speaker 6: we've completed before, sixty or three percent of employers said
16:59
Speaker 6: that they do in fact plan to add new roles
17:02
Speaker 6: in the first half of twenty twenty five. So you
17:04
Speaker 6: have less workers looking to make a move. So organizations
17:08
Speaker 6: are really going to have to be strategic when it
17:10
Speaker 6: comes to attracting talent and filling the mission critical roles.
17:13
Speaker 2: Right now, Corey Adams from Robert Half join us to
17:15
Speaker 2: talk about their most recent survey of two thousand US
17:18
Speaker 2: workers on job satisfaction and looking for that next role. Corey,
17:21
Speaker 2: always appreciate you join us. We'll talk to you again.
17:23
Speaker 6: Soon, my pleasure, talk soon.
17:25
Speaker 5: All right, Time for trivia here on the Financial Exchange,
17:27
Speaker 5: and today is Ronald Reagan's birthday. During Reagan's presidency, he
17:32
Speaker 5: signed a bill into law establishing the Doctor Martin Luther
17:37
Speaker 5: King Junior Holiday. Trivia question today, what year did President
17:42
Speaker 5: Reagan establish Martin Luther King Day as a federal holiday?
17:46
Speaker 5: Once again, what year did President Reagan establish Martin Luther
17:50
Speaker 5: King Day as a federal holiday? Be the fourth person
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18:18
Speaker 2: There is a new executive order from the Trump administration
18:21
Speaker 2: that came out I believe it was on Monday, specifically
18:23
Speaker 2: regarding something called deminimus when it comes to packages coming
18:27
Speaker 2: into the United States, specifically eliminating an exception where Customs
18:33
Speaker 2: was not required to inspect international shipments with a value
18:36
Speaker 2: of less than eight hundred dollars. This allowed companies like
18:39
Speaker 2: Temu and shen Big Chinese retailers to import a whole
18:44
Speaker 2: bunch of stuff without tariffs into the United States. That
18:46
Speaker 2: is apparently creating a fair bit of confusion out there.
18:50
Speaker 2: How this changes things, Customs and Border Protection needing to
18:53
Speaker 2: inspect and collect tariffs on many more packages. The US
18:56
Speaker 2: Postal Service even temporarily stopped accepting new packages from China
19:00
Speaker 2: and Hong Kong before allowing them again. But this is
19:03
Speaker 2: one of those loopholes that kind of had a dump
19:05
Speaker 2: truck driven through it, the Chinese imports represented seventy five
19:10
Speaker 2: percent of the Deminimus products that are found online, and
19:13
Speaker 2: so this was being taken advantage of. I think is
19:16
Speaker 2: a smart change, but how it gets implemented is going
19:19
Speaker 2: to be a really really interesting question. I think most
19:22
Speaker 2: certainly though, some of those Chinese retailers are going to
19:25
Speaker 2: have a tough go with it. Quick break. We'll have
19:27
Speaker 2: the trivia winner when we come back, and then I'm
19:32
Speaker 2: not sure yet, I'll let you know.
19:33
Speaker 5: Good sees.
19:34
Speaker 2: Thanks.
19:40
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20:08
Speaker 5: Trivia question today was what year did President Reagan establish
20:12
Speaker 5: Martin Luther King Day as a federal holiday. I'll be
20:15
Speaker 5: nineteen eighty three. Jack from Brockton, mass is our winner today,
20:19
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20:29
Speaker 2: For the first time ever since the inception of the
20:33
Speaker 2: four oh one K fifty years ago, half of private
20:36
Speaker 2: sector workers are now saving in four oh one k's.
20:40
Speaker 2: About seventy percent of private sector employees in the United
20:43
Speaker 2: States now have access to a four to oh one
20:45
Speaker 2: K style retirement plan. So I suppose that might include
20:50
Speaker 2: something like a simple array or other types of plans that,
20:53
Speaker 2: like they say, are similar to a four oh one K.
20:56
Speaker 2: And then in the public sector there are all sorts
20:58
Speaker 2: of different types of retirement savings plans. But mark you
21:02
Speaker 2: spent some time in the four oh one K space,
21:06
Speaker 2: what do you see having come from there and obviously
21:08
Speaker 2: having participated in four o one k's biggest benefits, biggest
21:12
Speaker 2: drawbacks of those types of plans that you see out there, commonly.
21:16
Speaker 4: Well undeniably they have been They came about at the
21:21
Speaker 4: right time they coinced. The first four to oh one
21:26
Speaker 4: K came about in roughly nineteen eighty one. Somebody discovered
21:31
Speaker 4: that the law we know is ARISA allowed for this
21:36
Speaker 4: kind of It started as a loophole, is what I'm
21:38
Speaker 4: trying to say. Yeah, the Congress didn't say we're creating
21:40
Speaker 4: a four oh one K, have at it. Somebody discovered
21:43
Speaker 4: that you could put away money on a tax deferred basis,
21:45
Speaker 4: providing you met certain conditions. Wasn't too long after that
21:49
Speaker 4: mid nineteen eighties when Fidelity and others jumped in started
21:52
Speaker 4: telling companies, hey, we'll do yours for free. Of course
21:55
Speaker 4: they were collecting money on the investment. Sure that approach
21:59
Speaker 4: has since been made illegal. They weren't doing anything wrong.
22:03
Speaker 4: It was a smart business model. But I guess my
22:05
Speaker 4: my larger point is four oh one K came along at.
22:08
Speaker 3: Exactly the right time, right time.
22:10
Speaker 2: Why because in terms of.
22:11
Speaker 4: Stock market growth, the growth in the economic recovery and
22:17
Speaker 4: simultaneous recovery and equity markets he said, altually uninterrupted for
22:22
Speaker 4: twenty years starting in nineteen eighty two.
22:23
Speaker 2: Sorry, I'd say it also came at a time of
22:25
Speaker 2: cyclical decline and pension availabilities, so that that was you
22:29
Speaker 2: know important.
22:29
Speaker 4: Tone and manufacturing jobs and other public sector jobs that
22:35
Speaker 4: historically offered pensions. So a number of factors supported the
22:39
Speaker 4: growth of the four oh one K. It was the
22:41
Speaker 4: right time legally because of this so called because of
22:45
Speaker 4: the lawino as Arisa, and maybe more importantly, stock markets
22:49
Speaker 4: were about to embark on an unprecedented run lasting nearly
22:54
Speaker 4: twenty years featuring double digit returns on average virtually interruptedly.
23:01
Speaker 4: So what was your original question before I got into
23:03
Speaker 4: my four oh one K stump speech?
23:06
Speaker 2: What would you see today if there are any of
23:09
Speaker 2: downsides to four o one k's or confusion by protestipants?
23:14
Speaker 2: What do we see as some of the drawbacks there
23:15
Speaker 2: as opposed to other vehicles for saving, Because well, honestly,
23:18
Speaker 2: it's kind of tough to compete with the fact that
23:20
Speaker 2: you can contribute more to four oh one K than
23:22
Speaker 2: any other type of tax specialized vehicle, and oftentimes your
23:28
Speaker 2: employer matches to it. So it's a pretty compelling case
23:31
Speaker 2: for most people.
23:31
Speaker 4: They're great accumulation vehicles. You defer a portion of your salary,
23:37
Speaker 4: your employer may match part of that.
23:39
Speaker 3: Typically they do. They may make an additional.
23:41
Speaker 4: Profit sharing contribution periodically. They don't have to, but they
23:45
Speaker 4: could if their profits allow for it. So a great
23:48
Speaker 4: accumulation vehicle. The investments are generally inexpensive. Now so called
23:53
Speaker 4: target date and other balance type products basically manage your
23:57
Speaker 4: money for you. They even get less risky as you
24:00
Speaker 4: get older, so there are lots of benefits for accumulators.
24:03
Speaker 4: For those in the savings stage, the problem is that
24:06
Speaker 4: they're not great decumulation or distribution vehicles. Now rules differ
24:12
Speaker 4: by plane, but for the most part, Mike, they're pretty inflexible,
24:15
Speaker 4: unlike with say your IRA, where you can call your
24:17
Speaker 4: provider get a withdrawal at any time and tell them
24:20
Speaker 4: where to take it from. For example, don't take it
24:23
Speaker 4: from my stock fund that's down a little or that's
24:25
Speaker 4: long term. Take it from a cash vehicle or a
24:28
Speaker 4: money market fund. Iras give you that type of withdrawal
24:31
Speaker 4: flexibility four and one case typically don't. So they're a
24:34
Speaker 4: bit rigid for people in their distribution if you like
24:38
Speaker 4: phase of life.
24:41
Speaker 2: We know that most of you listening have contributed to
24:44
Speaker 2: a four to one K in the past or are
24:45
Speaker 2: currently doing so. And you know, I've also heard a
24:48
Speaker 2: lot of confusion about them. How do I go about investing,
24:53
Speaker 2: selecting my fund lineup, what should I be doing traditional
24:56
Speaker 2: versus this RATH thing? And then also just sometime times,
25:00
Speaker 2: you know, in terms of my own family too, some
25:03
Speaker 2: general mistrust of anything that's provided to me by my employer,
25:07
Speaker 2: which is oftentimes misplaced based on how four oh one
25:10
Speaker 2: k's are set up. But I would tell you that
25:13
Speaker 2: if you're facing these types of questions. Maybe it's mistrusting
25:16
Speaker 2: your employer and what they may or may not do
25:18
Speaker 2: with that four to oh one K bucket. Maybe it
25:20
Speaker 2: is where you should be contributing to, or does it
25:22
Speaker 2: still make sense to go above and beyond the match
25:25
Speaker 2: in your specific situation. Call the folks, call the experts
25:29
Speaker 2: at Armstrong Advisory Group. We work with our clients every
25:32
Speaker 2: day on this type of thing, you know, tax sensitive investing.
25:36
Speaker 2: Where should the next dollar go? Am I better off
25:38
Speaker 2: of my four oh one versus you know, a non
25:41
Speaker 2: taxable account or maybe an HSA? What's going to actually
25:44
Speaker 2: benefit me best? Long term? Our phone numbers eight hundred
25:49
Speaker 2: three nine three four zero zero one. We offer free
25:52
Speaker 2: consultations in person throughout New England. We do it via
25:56
Speaker 2: zoom and phone call is well, but the first step
25:58
Speaker 2: is to give us a ring. Talk to one of
26:00
Speaker 2: our professionals here at Armstrong Advisory Group. Then number once
26:03
Speaker 2: again eight hundred three nine three for zero zero one.
26:08
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
26:10
Speaker 1: registered investment advisor. Nothing in the ad or in any
26:13
Speaker 1: Armstrong guide a specific financial, legal or tax advice. Consult
26:16
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26:19
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26:22
Speaker 1: advisory services.
26:23
Speaker 2: Speaking of that distribution phase of life, Mark, some forty
26:27
Speaker 2: thousand federal workers have apparently taken the buyout offer so
26:32
Speaker 2: far from the Trump administration to I believe the details
26:37
Speaker 2: are working through. It's unclear either mid or end of February.
26:41
Speaker 2: Getting paid through the end of September. Forty thousand workers
26:46
Speaker 2: sounds like a lot, but it is actually well below
26:49
Speaker 2: the target range for what they had been looking for,
26:51
Speaker 2: which is five to ten percent of the federal workforce
26:53
Speaker 2: or one hundred to two hundred thousand federal employees. You
26:58
Speaker 2: had also brought up to something to me, which is
27:01
Speaker 2: you mentioned approximately sixty five thousand government workers an entire
27:04
Speaker 2: every year. So that is frankly a little bit discouraging
27:09
Speaker 2: if the numbers end up here at forty thousand for
27:13
Speaker 2: Doge's work, because I can tell you only of one
27:16
Speaker 2: example I know of of a federal worker taking the package,
27:19
Speaker 2: and it was somebody who said, I'm planning to retire
27:21
Speaker 2: in like three months. I will absolutely take a package
27:24
Speaker 2: that pays me through September just to retire right now.
27:27
Speaker 2: And so we will see what these numbers look like.
27:30
Speaker 2: The deadline is apparently today. There are still a lot
27:32
Speaker 2: of questions out there about does this need funding for
27:35
Speaker 2: Congress to pay workers for not working through September, and
27:39
Speaker 2: unions have come out and said, hey, this offer isn't
27:42
Speaker 2: necessarily guaranteed, so buyer beware. But I won't be surprised
27:47
Speaker 2: if this actually ends up lining up pretty closely with
27:49
Speaker 2: the number of average retirees that we see every year,
27:52
Speaker 2: because there has just been a lot of stagnation the
27:55
Speaker 2: labor market and people are not necessarily trusting I think
27:58
Speaker 2: that they can jump and go find that next job.
28:02
Speaker 4: Yeah, this is going to pull forward, as evidenced by
28:04
Speaker 4: your example, people who had planned on retiring at the
28:08
Speaker 4: end of the year anyway. So a certain number of
28:09
Speaker 4: these will not be excess retirements. There'll be retirements that
28:14
Speaker 4: were planned.
28:14
Speaker 2: But what a deal if you can get it. I
28:17
Speaker 2: can get paid in by the federal government to not
28:20
Speaker 2: work for se a deal.
28:21
Speaker 4: For taxpayers, Mike, I don't know. Presumably they'll give us
28:25
Speaker 4: some sort of accounting on this at some point. Yeah,
28:27
Speaker 4: you do have one account for those who would have
28:29
Speaker 4: retired anyway.
28:31
Speaker 2: Yeah, I would love to see the average age of
28:33
Speaker 2: the person that takes this buyout. If it's over sixty,
28:36
Speaker 2: then this was a failure.
28:38
Speaker 3: Yeah, well it's going to be.
28:39
Speaker 4: It's probably not going to live up to expectations either way.
28:42
Speaker 4: The whole federal workforce all in cost taxpayers three hundred
28:47
Speaker 4: billion dollars a year. That may sound like a lot,
28:49
Speaker 4: but the federal budget is nearly six trillion, or one
28:54
Speaker 4: hundred one thousand times that, one hundred times that number.
28:57
Speaker 3: Yeah, doing the math right one is a.
28:59
Speaker 2: None of the I'll be most interesting and okay, when
29:02
Speaker 2: the final numbers come out, how did you do against
29:04
Speaker 2: the target of one hundred to two hundred thousand workers?
29:07
Speaker 2: Were we well below that? And was it mainly people
29:09
Speaker 2: that were retiring? Anyway, I agree with you. This is
29:11
Speaker 2: not going to fix our deficit problem even if the
29:14
Speaker 2: full two hundred thousand people take the buyout offer. Let's
29:18
Speaker 2: take a quick break when we.
29:19
Speaker 3: Come twenty times excuse me.
29:21
Speaker 2: When we come back. Stack roulette next on the Financial Exchange.
29:25
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29:55
Speaker 2: Time for a bit of stack rou let here on
29:57
Speaker 2: the Financial Exchange. I will kick things off since Mark
30:00
Speaker 2: is very clearly unprepared here Nissan looking for a new
30:04
Speaker 2: partner on as Honda deal. It looks like it's set
30:07
Speaker 2: to collapse before we get to a potential deal. I
30:10
Speaker 2: just want to talk about how much of a disaster
30:12
Speaker 2: Nissan looks like right now. The automaker will be reporting
30:16
Speaker 2: third quarter earnings next week, but they already pre announced
30:20
Speaker 2: a ninety four percent drop in net income for the
30:23
Speaker 2: first half and said that it will need to dismiss
30:26
Speaker 2: some nine thousand workers, kind a fifth of its manufacturing capacity.
30:32
Speaker 2: This is a company in massive turmoil. We teased for
30:35
Speaker 2: it for a little bit here, But Nissan, I mean,
30:37
Speaker 2: a ninety four percent drop in net income speaks to
30:41
Speaker 2: a company in a bit of crisis right now, and
30:45
Speaker 2: I really can't They did have some limited success over
30:49
Speaker 2: the course of the last decade. I know for a
30:50
Speaker 2: number of years that Nissan is the Nissan Rogue, the
30:54
Speaker 2: small suv. Is that what I'm thinking of? That one
30:57
Speaker 2: was pretty popular. You saw that all over the No,
31:00
Speaker 2: that's not the one I was thinking about. What's the
31:01
Speaker 2: even smaller suv?
31:03
Speaker 5: The least that's the elector No small suv because of
31:07
Speaker 5: the j juke Kicks.
31:10
Speaker 3: Maybe they don't even make the juke anymore.
31:12
Speaker 1: I don't know.
31:12
Speaker 2: No, I don't know. If the little bit don't make
31:16
Speaker 2: it anymore. Maybe, But they have had limited success in
31:19
Speaker 2: the small suv business for a little while. But this
31:22
Speaker 2: is a company that has a really complicated relationship with
31:25
Speaker 2: Renault that they were trying to unwind over the last
31:28
Speaker 2: several years. And a ninety four percent drop, you know, like,
31:32
Speaker 2: who's going to want to buy this company? The deal
31:35
Speaker 2: with Honda apparently didn't work again, still reportedly being talked about,
31:39
Speaker 2: so it's not completely dead yet, but the deal looks
31:45
Speaker 2: like it's pretty much dead in the water. And Nissan
31:48
Speaker 2: was not terribly interested in becoming a subsidiary of Honda.
31:51
Speaker 2: They wanted some form of partnership and that doesn't look
31:55
Speaker 2: likely to happen here.
31:56
Speaker 5: They have a six different SUVs. Kicks is the smallest,
32:00
Speaker 5: followed by Rogue, Pathfinder, Aria, Morano and Armada six s uvs.
32:10
Speaker 2: Maybe it was the rogue that I was thinking of.
32:12
Speaker 2: I don't know. It always looked like a little bug
32:14
Speaker 2: to me in some way, shape or form. But yeah, nonetheless,
32:17
Speaker 2: Nissan fallen on some hard times here and struggling to
32:20
Speaker 2: really find their way in the market. What do you
32:23
Speaker 2: have for us for stack with that.
32:24
Speaker 4: Mark, Mike, Here we go again, lawmakers pushing to ban
32:28
Speaker 4: Deep Seeks app from government devices.
32:32
Speaker 3: For starters, Can.
32:33
Speaker 2: We just say that if you work for the federal government,
32:35
Speaker 2: you should not have an application on your phone from China? Like,
32:39
Speaker 2: is that really too difficult for us to just all
32:42
Speaker 2: agree an.
32:43
Speaker 4: App with ties to any foreign government adversarial?
32:48
Speaker 3: Yeah, I mean it's not that difficultversarial or not.
32:51
Speaker 4: Yeah, I mean you restrict what I can put reasonably
32:54
Speaker 4: so we can put on our cell phones if we
32:56
Speaker 4: also use them to access work.
32:58
Speaker 3: Right email?
32:59
Speaker 2: Yeah, So this is.
33:00
Speaker 4: Something that's routine, is my point, in the private sector world,
33:03
Speaker 4: particularly those of us who work in financial services and
33:05
Speaker 4: probably every industry.
33:06
Speaker 2: Now, I guess it get used to it. It starts
33:08
Speaker 2: to get complicated if you say any foreign developed app,
33:10
Speaker 2: Because now I think about it, don't new cars require
33:13
Speaker 2: you to basically require you to have an app to
33:15
Speaker 2: operate them, Like, do I need to have a Toyota
33:17
Speaker 2: app if I'm buying a twenty twenty five Toyota, I
33:19
Speaker 2: think I kind of do so, Like I don't think
33:22
Speaker 2: you need to go that far, but like, yeah, generally speaking,
33:26
Speaker 2: I really don't want any Chinese made app on any
33:29
Speaker 2: Americans phones. But certainly, if you work in government, a
33:32
Speaker 2: reasonable expectation should be that if you have an app
33:35
Speaker 2: that is developed by a company in China, North Korea, Iran, Russia,
33:41
Speaker 2: it probably shouldn't exist on your phone as a government worker.
33:44
Speaker 2: That seems like a very low bar to me.
33:47
Speaker 4: Yeah, Or you keep your your personal cell phone stays
33:49
Speaker 4: in your car, Yeah, you don't. You can't download any apps.
33:53
Speaker 4: Maybe you don't discriminate in favor of or against those
33:57
Speaker 4: with ties to a particular country or govern because that
34:00
Speaker 4: does get a little bit unwieldy. Who's our enemy this week?
34:03
Speaker 4: And so forth? But this is not hard in the
34:08
Speaker 4: private sector, right, employers restrict what you can do even
34:12
Speaker 4: on your personal devices if you choose to put work
34:14
Speaker 4: related apps.
34:15
Speaker 3: On them all the time.
34:17
Speaker 2: Right. Deep Seek remains, by the way, the most downloaded
34:20
Speaker 2: app in both the Apple and Google App stores right now.
34:24
Speaker 2: So it is still what are surgeing about it?
34:27
Speaker 4: Just querying to try to stump it.
34:30
Speaker 3: I like, why would you? Why would you put this
34:32
Speaker 3: on your cell phone?
34:32
Speaker 2: I don't have a great answer. I think probably you
34:37
Speaker 2: are testing it out and saying, hey, is it really
34:40
Speaker 2: that much better than say chat GPTs free version, which
34:44
Speaker 2: it might or might not be. I don't know. I
34:47
Speaker 2: don't know why people are I mean procuring.
34:48
Speaker 4: People, people who may be buying software that is AI
34:53
Speaker 4: powered at some point. I get it, but I just
34:57
Speaker 4: don't understand the practical at this point for most of them.
35:01
Speaker 2: Chili's is popular.
35:02
Speaker 5: Again apparently, Yeah, a fast casual restaurants. They are.
35:08
Speaker 2: We do we believe the Wall Street Journal's definition of
35:11
Speaker 2: what's popular.
35:12
Speaker 5: I've seen multiple reports on this. This isn't just like
35:14
Speaker 5: a single outlet thing like I've seen.
35:16
Speaker 2: How How are they going about making Chili's popular again? Uh?
35:21
Speaker 2: Brinker International owns the company Chili's and have been revamping
35:25
Speaker 2: the chain's menu, remodeling their restaurants, which is probably all
35:29
Speaker 2: you need to do. I think where they are having
35:33
Speaker 2: a moment here is We've talked about this at length before.
35:38
Speaker 2: The differential now between fast food and what do we
35:42
Speaker 2: call this, like, it's not fast casual, it's sit down.
35:45
Speaker 2: But the price differential now between getting a burger at
35:49
Speaker 2: like a Chili's or TGI Fridays compared to going to
35:52
Speaker 2: in and out and getting a full, you know, burger
35:54
Speaker 2: meal there, it's really narrowed over the last few years,
35:57
Speaker 2: especially if you live in our most populated state in
36:00
Speaker 2: the country, California, where they've got these new fast food
36:03
Speaker 2: minimum wage laws. The price differential is really narrow now
36:06
Speaker 2: from what I understand, and so that might be all
36:09
Speaker 2: it is is seizing on that moment to say, Okay,
36:12
Speaker 2: we've got the pricing down, so if we can just
36:14
Speaker 2: make this a popular area to come grab a drink
36:17
Speaker 2: and buy some food, maybe that's all they really need
36:20
Speaker 2: to do.
36:20
Speaker 5: Yeah, I'm just looking at a c CNBC item from
36:23
Speaker 5: back in September and they noted that they have had
36:27
Speaker 5: a viral social media presence and a push toward value
36:30
Speaker 5: oriented advertising helping propel sales growth.
36:34
Speaker 2: Yeah, I think I think that might work. I'm interested
36:37
Speaker 2: in the Chile's store sales jump. Yeah.
36:41
Speaker 4: Again, food is really good. When did they become I
36:44
Speaker 4: missed it. When did they become unpopular?
36:47
Speaker 2: I feel like all these fast casual brands not fast casual.
36:51
Speaker 2: What are we describing the segment? I don't know, Like
36:54
Speaker 2: just sit down.
36:55
Speaker 5: Chain, you're gonna get the same thing in every location.
36:58
Speaker 2: Chili is TGI Fridays, all Garden. I think all got
37:01
Speaker 2: kind of that reputation as just the tired old sit
37:05
Speaker 2: down restaurant brand that you your grandparents brought you to.
37:09
Speaker 2: Ground Round struggled. Many of these just struggled to I
37:12
Speaker 2: think draw new attraction and all the eyes were set
37:14
Speaker 2: on shake Shack and and in and out Burger, and
37:17
Speaker 2: these places struggled, and I think they're having a bit
37:20
Speaker 2: of a resurgence is the only real story.
37:22
Speaker 5: I guess their triple dipper dipper is a staple on TikTok,
37:26
Speaker 5: and their marger readers are too. In terms of value
37:30
Speaker 5: and bang for your bucket, I don't know. It's big
37:32
Speaker 5: with the youngsters.
37:33
Speaker 2: We should probably broadcast from a Chili sometime soon. Tucker,
37:36
Speaker 2: can you can you make that? Can get some baby
37:39
Speaker 2: back ribs. Dow Jones Industrial average now off one hundred
37:43
Speaker 2: and twenty five points, a little bit more than a
37:45
Speaker 2: quarter of one percent, the S and P up a
37:48
Speaker 2: fifth of a percent, still up twelve points now, the
37:51
Speaker 2: NASDAK up twenty seven points, a little bit more than
37:54
Speaker 2: a tenth of a percent, and the Russell two thousand,
37:55
Speaker 2: those smaller size companies off very slightly. We will have
37:59
Speaker 2: the behemoth Amazon reporting this evening at five pm, so
38:03
Speaker 2: keep an eye on markets, followed by the jobs report tomorrow,
38:06
Speaker 2: so tune in, stay warm, get those driveways shoveled, and
38:10
Speaker 2: we will talk to you tomorrow, folks,