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Trump vs Harris, breaking down their economic proposals · The Financial Exchange Show

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Veterans Development Corporation. This is the Financial Exchange with Chuck
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Zutta and Paul Lane.
1:12
Speaker 2: Chuck, Paul and Tucker with you here as we kick
1:15
off the second hour of the Financial Exchange. And we
1:18
got a whole bunch of red on the board as
1:21
we look through major indices. The Dow Jones Industrial Average
1:24
off six hundred and forty points about one and a
1:26
half percent, the S and P five hundred down seventy
1:29
points about one to quarter percent, and the NASDAK down
1:31
one hundred and fifty six points or about nine tenths
1:34
of a percent today, So a lot of red on
1:36
the board after a little bit of a bounce to
1:38
start the week, this largely erasing most of that so far.
1:42
Tenure US Treasury down one basis point to three point
1:45
sixty three percent. Oil is finding a little bit of
1:50
stability now. It's up twenty cents a barrel on West
1:53
Texas Intermediate to sixty five ninety five a barrel, but
1:57
the TRIPAA national average for gas prices continues to cone
2:01
now down to three twenty five and three tenths of ascent.
2:04
And we'll talk a little bit later in the hour
2:07
about where we expect gas prices to go in the
2:10
coming weeks here. And finally we've got gold today down
2:14
four dollars and ten cents an ounce to twenty five
2:19
thirty nine even, And so that is what we are
2:23
seeing moving in markets today, but again kind of a
2:25
risk off reversal thus far of what we have seen
2:28
otherwise this week. We'll see where things go in the afternoon,
2:32
just because again we've seen some intra day volatility, but
2:37
thus far not a great start to the day here.
2:41
Yesterday there was a small gathering of politicians to discuss
2:50
issues of the day. It was televised on ABC. I
2:54
believe it was called a debate, and during that there
2:59
was some discussion of economic ideas, not a ton quite honestly,
3:04
So most of it we're not really going to address
3:06
because we're a business show, and the other stuff is
3:10
not really relevant to what we look at, and quite honestly,
3:14
I don't have any idea about a lot of it
3:16
because our focus is this. But we did get some
3:19
talk about tariffs, about inflation, some talk about energy, talks
3:25
about jobs, things like that, and so I thought it
3:28
would be useful just to kind of go through some
3:30
of the key areas and you know, talk about what
3:35
was said and kind of a hey, how does this
3:38
actually play out for the US economy? And b are
3:42
these you know, legitimate claims that were being made by
3:46
Kamala Harris and Donald Trump. I'll start first with just
3:53
looking at the deficit side of things, because this is
3:56
one place where I continue to argue that there is
3:58
less room between these candidates. Then they want you to
4:02
believe in that. Kamal Harris said that the proposed budget
4:07
from another Trump administration would expand the deficit dramatically, which
4:12
is true. The counterpoint is that the proposed budget from
4:16
the what would be a Harris administration would expand the
4:19
deficit meaningfully as well. There is no conclusive plan by
4:23
either party or either candidate to make any full, meaningful
4:26
progress on the national debt full stop, Like no one's
4:31
dealt with it in forty five years, and no one
4:35
really is even at least twenty years ago. You could
4:37
kind of talk about it, Republicans would consistently say, yes,
4:41
this is what we want to do. Now. The budget
4:43
plans that you have are just not even you know,
4:46
trying to get there. Quite honestly, it's the issue that
4:49
drives me.
4:49
Speaker 3: The craziest chuck when it comes to the election cycle
4:53
is that it's never gonna be discussed and we're gonna
4:56
sit here and continue to bang our heads against our
4:58
deaths hoping that someone would address it. But cut and dry,
5:03
it's not going to get anyone votes by saying that
5:05
they're going to cut spending, even though it's the fiscally
5:08
prudent thing to at least discuss some ideas for that.
5:12
The other piece of the equation is to address national deficits.
5:15
You have to talk about increasing revenue. That means saxon increases,
5:19
which no one is going to be skipping to the
5:22
polls to vote for either. That frustrates me the most.
5:25
It just drives me insane that there's no mention of that,
5:30
and that is not going to change. Unfortunately, I just
5:33
have to continue to vent to.
5:35
Speaker 2: You here on the inflation side of things, Donald Trump
5:39
said that inflation was the worst in history during the
5:42
Biden years, which it was worse during the Carter years.
5:45
But that's it so well. Actually, even post World War
5:50
Two you had some higher inflation as well. So you've
5:51
had two periods in you know, kind of recorded economic
5:55
data that were worse, so not entirely true, but also
5:58
not really good company to be keeping the Biden administration.
6:02
And also Donald Trump said, hey, there was no inflation
6:06
when he was president. Bloomberg gets kind of like snippy, yeah,
6:12
like weasily on this where they're like, oh, well, the
6:14
inflation was actually two point five when he took office,
6:17
reached a high at two point nine, and then was
6:19
one point four when he left. Look, inflation around two
6:22
percent is where we've generally wanted it. I don't really
6:25
take exception to Donald Trump saying there was no inflation
6:29
when he was in office because.
6:30
Speaker 3: It was really low. It was not a concern. No,
6:33
I never talked about it.
6:34
Speaker 2: No one talked about it. So this is like a
6:36
little Weasley being like, hey, this is you know, a problem,
6:39
Like no, like there was basically no inflation while he
6:42
was in office. And I don't really have a problem
6:45
with him saying something like that. Other things that you
6:50
have here that were talked about on the jobs front,
6:54
let's see Donald Trump said that the Biden administration is
6:58
lost manufacturing jobs in the last couple months, which is
7:01
not true. You've actually seen worst numbers on the Biden
7:06
side than Trump said there was a loss of twenty
7:09
four thousand manufacturing jobs in August, not ten thousand. So
7:13
I guess this again is saying that like Trump was wrong,
7:15
but it's not. It was wrong by like a smaller
7:18
amount than the Biden administration actually lost. So I'm not
7:23
really sure what the fact check is on that. Other
7:27
things that we see here tariffs. A lot of discussions
7:31
about tariffs and whether or not they would end up
7:32
raising costs on end users. Your thoughts on what you've
7:36
seen there, Paul.
7:38
Speaker 3: To me, it's a concern because the proposed pan from
7:41
Donald Trump is to enact a ten percent across the
7:44
board tariffs on imporse and then increase the tariffs associated
7:48
with Chinese made goods to sixty percent. I've said it
7:51
on the show before, and I'll say it again. When
7:54
we finally have inflation under reasonable control, I think we
7:57
can all agree, and we talked about in the first
7:59
hour of the show that the progress made there is
8:01
pretty substantial. Our focus has kind of shifted to the
8:03
economy and the labor market to enact those type of
8:06
broad based tariffs not only in my view, would invite
8:09
retaliation from other nations taxing US Additionally, what you could
8:15
run into. I'm very convinced and economists have proven this
8:18
out that ultimately it does end up going down to
8:21
the end consumer who foots the bill for those types
8:24
of tariffs. Again, it's important to note that all these
8:28
political concepts of a plan, ideas or just potential policies
8:34
have to be taken with a grain salt chuck, because
8:36
you got to get into office, and you got to
8:38
get Congress on board with passing something. And it's just
8:42
I hate that I spent so much time last election
8:44
talking about Biden and tax increases and all this different
8:47
stuff that none of it came to fruition. So I
8:49
always want to make sure I mention that when we're
8:52
talking about proposed policies that they're a bit pie in
8:54
the sky until a couple things come into place.
8:57
Speaker 2: Most of the time you really don't have to pay
8:58
that close attention because they usually don't end up happening.
9:01
Show me yeah, other like, I'll just wrap up with
9:04
this one. On the energy side of things, Kamala Harris
9:07
says that she would not ban fracking hydraulic fracturing in
9:12
order to you know, drill for energy. Previously, Harris had
9:18
been in favor of a plan that would have banned fracking.
9:23
So again, potentially some changes from previously stated positions as well.
9:28
Again we'll see, you know what policy actually ends up
9:31
coming to be once you know, we know who's president,
9:34
once we see what they do. But generally a lot
9:37
of this stuff is rarely actually enacted. It's you don't
9:44
have like ten bills passing in a given year normally
9:47
about economic stuff just because you can't get Congress on
9:51
board usually. So I think that the main takeaway is, hey,
9:55
most of the stuff that's being talked about probably not
9:58
going to happen. A b there's a whole bunch of
10:03
claims that get thrown out in debates that are questionable
10:06
because that's kind of what you do in a debate,
10:08
is you kind of go up to that line in
10:10
some cases go through it. And quite honestly, I'm not
10:15
sure that we really learned anything new as a result
10:18
of this. From an economic perspective.
10:20
Speaker 4: Do markets care about last night?
10:23
Speaker 2: I don't really know how you would even measure it.
10:28
Speaker 3: I'm asking on a question I had looked back at
10:30
the last debate the Vics. At that point we were
10:34
in a very subdued period of time for volatility. It
10:37
was extremely low at that point. It did not move
10:40
significantly the following day. You can make the argument that
10:43
interest rates there was a bit of an uptick two
10:46
days after the first debate, But I am of the
10:50
proponent that these debates do very little to move markets.
10:53
The reason that markets are down today is the inflation
10:56
report and the idea of maybe fifty basis points being
10:59
off the table, or September just being a wonky month,
11:03
more so than anything that happened to the debate last night.
11:06
Speaker 2: Take a quick break here. When we come back, we'll
11:09
do a little bit of trivia, and then we're talking
11:11
social Security cost of living adjustments for next year.
11:14
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11:54
Speaker 4: Still a little bit of trivia here on the Financial
11:56
Change and it's brought to you by Applebee's. Take your friends,
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that's even go in the neighborhood void. We're prohibited dine
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in only well. As we all witnessed, last night was
12:24
the first presidential debate between Kamala Harris and Donald Trump.
12:28
The first televised presidential debate took place sixty four years ago.
12:34
Triviy question today which two candidates appeared in the first
12:38
televised presidential debate? Once again, which two candidates appeared in
12:42
the first televised presidential debate? Be the fifth person today
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did Texas at six one, seven, three, six, two thirteen
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eighty five with the correct answer, and you win a
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Financial Shane Show T shirt and be registered to win
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a one hundred dollars gift card to Applebe's.
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Speaker 2: Be short.
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Speaker 4: Include the key at Applebee's in your text, and we'll
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give away that Applebe's kift card on Friday show six
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one seven, three six two thirteen eighty five and the
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fifth correct response will be our winner. See complete contest
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rules at Financial Changshow dot com.
13:13
Speaker 2: Peece in the Wall Street Journal here retirees will get
13:16
a smaller Social Security raise in twenty twenty five, and
13:20
that's okay. What this gets at is that the cost
13:23
of living adjustment for next year for Social Security is
13:26
determined by the average inflation data for July, August, and September.
13:32
We've now received July and August. We have not yet
13:36
seen the September data. But the Senior Citizens League, who
13:40
forecasts this stuff, in order to kind of give a
13:42
heads up to seniors about what to expect on it,
13:46
they are projecting a two point six percent cost of
13:48
living adjustment for next year for the for Social Security.
13:53
The Committee for a Responsible Federal Budget thinks will be
13:56
between two point four and two point six percent. And
13:59
what this so do With a two point six percent
14:02
it would raise the average retirement benefits by fifty dollars
14:05
a month to nineteen hundred and sixty nine dollars. Again,
14:07
that's average. I know if you're listening your individual benefits
14:10
could be different, but that would be again some slower
14:16
growth in these payments. But ultimately it means it's because
14:19
you're seeing slower growth in overall inflation.
14:22
Speaker 3: Yeah, we've seen over the past three years acumulative increase
14:26
on the cost of living adjustments to about nineteen percent
14:30
from twenty one through twenty four here, but as you mentioned,
14:34
the pace of that is going to slow down. To
14:36
be clear, that eighteen or nine per pen percent doesn't
14:40
keep up in absolute lockstep with inflation on across the
14:44
board on some other items that have gone up significantly
14:46
more over that period of time. But some really good
14:50
pieces of information from this article here in the Wall
14:52
Street Journal piece, twenty percent of that fifty dollars increase
14:57
that the average Social Security benefit recipient is gonna receive
15:00
will be offset by the increase in Medicare premiums. They
15:03
are scheduled on the lowest level to go from one
15:06
hundred and seventy four dollars and seventy cents a month
15:09
to one hundred and eighty five dollars. That's according to
15:12
the Medicare Trustees estimate done back in May. So some
15:16
of the adjustment will be offseted by that increase in
15:20
Medicare premiums, which most people have debited from their monthly
15:25
payment from Social Security.
15:27
Speaker 2: And the part that is tough for retirees on this
15:29
is the if you think about and again, every retiree
15:33
is different. I mean, they're retirees that do all kinds
15:36
of stuff. But you talk to a lot of retirees
15:40
and the thing that you generally hear is, yeah, you know,
15:43
my life's pretty simple right now. I don't necessarily do
15:46
a ton, so you know, my discretionary expenses aren't that high,
15:51
and you know, mostly spending on you know, stuff around
15:53
the house and this and that. Think about where we've
15:56
seen big increases in costs in the last year too,
16:01
homeowner's insurance, auto insurance. You know, those are up double
16:04
digits in a lot of cases over the last year. Okay, this,
16:09
you know, two point six percent bump doesn't necessarily do
16:12
enough to help with that. On the other hand, places
16:15
where you've seen prices come down are places, you know,
16:20
cars and trucks and things like that. Okay, that's nice,
16:24
but those are kind of one off expenses. It's not
16:26
something that a retiree is going and buying every year,
16:29
so it doesn't necessarily help as much other places where
16:33
you've seen prices come down. Airline fares, Okay, this is
16:36
a good one if you are a retiree who likes
16:38
to travel. Those travel costs are lower right now than
16:41
a year ago, and so that is one area where
16:45
you have seen some improvement. Food from the CPI is
16:49
up two point one percent year over year, so again
16:52
kind of in line with the overall numbers. But I
16:56
do wonder how much those higher insurance costs in particular
16:59
are our impacting retirees that don't really have a great
17:03
way to figure out how to offset that, and the
17:06
cost of living adjustment on Social Security is just not
17:09
going to be enough to keep up with those in
17:10
a lot of cases, especially in parts of the country
17:13
that are seeing the biggest increases, which tend to be
17:15
retireing heav you think about places like Florida. So just
17:20
a consideration on that front. But again, the numbers won't
17:24
be finalized for another month or so, but probably somewhere
17:27
in the ballpark of a two and a half percent
17:30
adjustment for next year, give or take a tenth or
17:34
so of a percent.
17:36
Speaker 3: That sound about right, sounds fair to me.
17:39
Speaker 2: A recession signal is flashing red, or is it? That's
17:43
the headline from the Wall Street Journal. And it appears
17:47
that maybe Paul's stack was stapled differently or something, so
17:50
he doesn't have this piece. I don't know. Paul's scrambling looking.
17:55
Speaker 4: For it, so maybe Lutsky took it.
17:57
Speaker 2: I don't know, Paul. What do you think about this signal?
18:00
Speaker 3: I've got it here, don't you worry? Chuck?
18:02
Speaker 2: I thought we I didn't even tell you what the
18:04
signal was. I was hoping you didn't have the piece.
18:06
We're just gonna have to wing it on something.
18:08
Speaker 3: No, I've got my notes all ready to go. It's
18:10
it's pretty reminiscent to what we were sort of debating
18:13
about in the first hour, where I was sort of
18:15
taking the stance that historically, if you go back, the
18:19
piece that they're mentioning here as a recession signal is
18:22
interest rates. We had a yield curve that was inverted,
18:27
meaning that you could get a higher interest on a
18:29
shorter term maturity treasury such as a three month or
18:32
six month over the last two years versus buying a
18:35
US tenure treasury. Those have now uninverted on the two
18:38
year and tenure US treasury, where the US two year
18:41
treasury you can get for three point six three percent
18:44
right now, the tenure is sitting around three point sixty five. Typically,
18:48
when you have an inverted year clurve that has preceded
18:51
recessions historically. Similarly, when you have a uninverted yield curve
18:55
that has also preceded recessions, those are signals. They're not
19:00
by any means gospel that necessarily this is to occur.
19:03
They just historically have in the past.
19:05
Speaker 2: So that's where we stand right now. Again, the yield
19:08
curve normally is uninverted, but it's that uninversion happening that
19:13
people get a little bit nervous about as a signal
19:16
for what could happen with the US economy. Interesting data
19:20
point on this is, hey, even though this can lead
19:23
to economic and even market volatility, it's not something where Hey,
19:27
just because it the yield curve on inverts, markets inherently
19:30
sell off right away. That's not the case. Quick break here.
19:33
When we come back, we've got the trivia answer.
19:41
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Speaker 4: Trivia question today was which two candidates appeared in the
20:09
first televised presidential debate. It would be Kennedy and Nixon.
20:13
The first general election presidential debate was nineteen sixty. It
20:17
was September twenty sixth, nineteen sixty between JFK and Vice
20:22
President Richard Nixon. The Republican nominee, Chris from Sanborville, New Hampshire,
20:28
was our winner today, taking on a Financial Exchange Show
20:31
T shirt and Chris is also registered to win a
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one hundred dollars gift card to Applebee's which you'll give
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dying in.
20:53
Speaker 2: Only a couple of different energy related stories to get
20:57
into here. The first one from the bloomy Berg talking
21:01
about how oil now being in the sixties gives kind
21:04
of a wider runway for a soft landing globally because
21:08
it allows central banks to cut interest rates more quickly.
21:12
Your thoughts on this, Paul.
21:13
Speaker 3: I would argue that sentiment just because typically when the
21:17
US Federal Reserve is looking at inflation data core PCE,
21:22
we talk about a lot of for the FEDS preferred measure,
21:26
it strips out the impacts of energy and food. We
21:29
talked about that in the first hour of the show,
21:31
that that core data is strips out the noise from
21:34
energy because it can be so volatile. You and I
21:36
can sit here and talk about oil being in the sixties,
21:40
but I'm not gonna sit here and say that it
21:43
couldn't be in the eighties or ninety six months for now.
21:45
It's just so hard to predict. I'm not saying that
21:48
that is something that's going to occur, but the idea
21:51
of having lower oil prices and it having direct impact
21:56
on the Federal Reserve and its policy changes to me.
21:58
I don't feel as necessarily the case. Is it important
22:02
for overall consumer sentiment and just people's feelings on inflation, Yeah, absolutely,
22:06
but not in terms of policy impact.
22:08
Speaker 2: Yeah. I don't think the FED looks at oil prices
22:10
and assumes they're going to be moving any direction when
22:13
they're trying to enact policy, because I think they basically acknowledge,
22:18
we don't know where the heck thees are going to go,
22:20
and so we're going to manage everything else or try
22:23
to because we have no idea if oil is going
22:26
to be at fifty, seventy eighty or twenty a barrel
22:29
going forward.
22:30
Speaker 3: That's the one thing I've learned in this industry is
22:31
that I don't know and no one knows how to
22:34
project oil prices. It's just so difficult to do.
22:37
Speaker 2: No now what you are seeing here in terms of
22:40
gas prices, the triple A national average four gas prices
22:44
currently sits at three twenty five and three tenths of
22:47
a barrel. A month ago, it was at three forty four.
22:50
A year ago, it was at three eighty three, and
22:53
so you've seen, you know, a pretty sizable move down.
22:56
Now if you look at gasoline futures and the pricing
23:01
that you're seeing there, it is very much feasible that
23:06
we have another ten percent or so to fall. As
23:11
far as gas prices. What that means, it's a decent
23:14
chance that's somewhere around October first, you might be seeing
23:16
national gas prices at or below three dollars per gallon.
23:21
Now you've already got parts of the country where you're
23:24
below that on average, pretty much the entire southeast, aside
23:28
from Georgia and Virginia, you've got gas prices below three
23:34
dollars a gallon already at the moment. On the other hand,
23:37
you take a look at the western part of the country,
23:38
where again because of gas taxes and getting the stuff
23:41
out there, it's it's much higher. But again you look
23:44
at the numbers that we're seeing, and you've already got
23:47
large parts of the country that are below three dollars
23:49
a gallon, and quite honestly, that is going to very
23:53
likely spread over the rest of the country within the
23:58
next count read to four weeks. Now, there are some
24:02
states that are not gonna get anywhere close to three
24:04
a gallon, like, as an example, California at four seventy
24:06
four right now, sorry, you're not gonna have three dollars
24:09
gallon gas there. You might have four to fifty instead
24:11
of four to seventy five, but it's not gonna be
24:14
three a gallon. Hawaii at four sixty four likewise, sorry,
24:18
it's probably not happening for you. Washington State at one
24:21
I'm sorry, at four fifteen, not happening there. The New
24:26
England region, though, you've got some states that do have
24:28
the possibility to get into that area. Rhode Island's at
24:30
three twelve right now, it's heading under three probably, Connecticut
24:34
at three twenty five decent chance, Massachusetts three twenty four,
24:38
decent chance, New Hampshire at three twenty decent chance. From
24:41
onn at three thirty one. Kind of a coin flip,
24:44
I think, in Main at three twenty nine, coin flip ish.
24:47
But you got four out of the six New England
24:49
states that are probably heading to right around three dollars
24:53
a gallon, if not below three a gallon over the
24:56
next few weeks. So when we talk about the economic impact,
25:00
this huge potential savings for drivers and households, and this
25:04
is something that can also help then to offset some
25:07
of the slowness, because if you have in the aggregate
25:09
billions of dollars in spending that doesn't have to happen
25:13
on gas. It can potentially happen elsewhere, and that can
25:15
help to kind of buffet the US economy and provide
25:18
a little bit of support as well.
25:20
Speaker 3: Two biggest reasons for some of the gas declines that
25:22
we've seen. You know, China has really fallen off in
25:25
terms of their crude imports. It fell two point three
25:29
percent the first six months of the year, their endpoints,
25:31
their endpoints of oil, and their forecast for the remaining
25:34
six months. This was done back in July. This analysis
25:38
was rather bleaked too, so that is a big contributor.
25:41
We're also anticipating that the global oil production will increase
25:44
about one and a half million barrels a day this year,
25:48
even with some OPEC plus cuts sort of extended in there.
25:53
Speaker 2: And just to show you kind of how the math works,
25:56
if you look at a gallon of oil, I'm sorry,
26:01
not a count a barrel of oil. That was, you know,
26:03
kind of a dumb way to phrase this barrel of oil,
26:07
you're looking at forty two gallons. And so the US
26:11
in terms of gasoline goes through nine million gallons of
26:15
jeez buh, nine million barrels a day of gasoline. So
26:22
if you do the math out, it works out to
26:24
three hundred and eighty two million gallons a day that
26:27
the United States is using. If you see a twenty
26:32
five cent drop on a day, you know, in terms
26:35
of the price of gas, that's one hundred million dollars
26:39
a day, ninety five million dollars a day that Americans
26:42
are saving over the course of a month. You're talking
26:45
three billion dollars in cumulative savings over the course of
26:48
a year, thirty six billion dollars in cumulative savings. That
26:53
is money that can then be spent in other places
26:56
that in turn can help drive economic activities. So when
27:00
we see these moves and gas prices, it is something
27:04
that does create a meaningful shift potentially in the ability
27:09
for American families to either a save money and be
27:13
able to kind of replenish their savings and not relies
27:15
heavily on credit cards, which would be nice, or b
27:19
spend that money and say yes, like there's more economic
27:22
activity that's generated as a result of this. So I
27:25
think all of that is something to watch when we're
27:28
concerned about where the US economy is going lower gas
27:31
prices a nice little, you know, helping hand to offset
27:35
some of that slowness potentially. Also, we've got an event
27:41
happening from the Armstrong Advisory Group, actually a couple events
27:45
that are going to be happening in October. The first
27:48
is going to be a seminar at the MGM Springfield
27:52
on Tuesday, October eighth. The second one is going to
27:56
be at the Margaritaville Hotel and Resort in Hyanas on
27:59
October twenty fourth. That one, we're actually gonna have Ed Lambert,
28:03
host of the WXTK Morning Show, joining us there. It's
28:07
going to be a live broadcast of the Financial Exchange,
28:11
followed by an educational launch with the Armstrong Advisory Group.
28:15
Topics that we're going to be discussing upcoming presidential election
28:19
and the economic policies that both candidates have proposed, what
28:22
effect they may have on the current economic landscape, and
28:26
how potential market volatility can influence your investment decisions. You
28:31
can sign up for the nearest event by visiting Armstrong
28:35
Advisory dot com slash events. All you have to do
28:38
is fill out the form associated with the event that
28:41
you'd like to attend. That address again is Armstrong Advisory
28:45
dot com slash events.
28:48
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
28:51
registered investment advisor. Nothing in the ad or in any
28:53
Armstrong guide a specific financial, legal, or tax advice. Consult
28:56
your own financial, tax, and estate planning advisors before making
28:59
any investment decisions. Armstrong make contact you to offer investment
29:02
advisory services.
29:04
Speaker 2: So when we talk about the growth of families these days,
29:11
we know that families are not the same size that
29:13
they were in previous decades. Uh and a quarter of
29:17
millennials and Gen zs without children say hey, we don't
29:20
want to become parents. This is according to a study
29:24
from Mass Mutual. And one of the key things that
29:27
they cite in this study is that a huge reason
29:31
why people are why these people are saying, hey, we
29:34
don't want to have kids is financial. Hey, it's tough
29:36
to afford to do so. And I'm gonna call Bologne
29:42
on this. And the reason that I'm gonna call bolone
29:45
is that even in parts of the world that have implemented,
29:49
you know, huge paid family leave options, South Korea tried
29:54
to do some significant childcare supplements and things like that,
29:57
where you know, the cost goes down significantly and availability
30:01
of parents goes up significantly. You have not seen a
30:05
meaningful shift in birth rates as a result. And so
30:09
I know that everyone wants to say that, hey, it's
30:13
it's you know, financial stuff is a key driver and
30:16
this and that, And it's not to say that having
30:18
kids is financially cheap. It's not. It's it's very expensive.
30:21
And I understand that it's a huge drawback, you know,
30:24
financially having kids. It's like it's a it's a huge
30:27
suck of money, like it is, But I don't believe
30:31
that that's actually the main reason why people are having
30:33
fewer kids, are choosing not to have kids.
30:35
Speaker 3: We're in agreement here. I was gonna come at this
30:37
the same way there. It may be a factor as
30:41
one of five in someone's decision to not have children,
30:45
but the other four are equally as significant in the decision.
30:48
It's ultimately a lifestyle decision, and while financials may play
30:53
a waiting in that pie, it's not the whole pie.
30:55
There's a lot of other reasons in place that would
30:59
lead to a family making that decision. So it's really
31:02
hard to come at it as just financial because we
31:05
can make the counterpoint that there have been countries that
31:07
have tried to make it more financially affordable to have kids,
31:10
and that doesn't stimulate birth rate. It's more these bigger,
31:14
broader decisions that families have to make as to whether
31:16
they want to go down that road.
31:18
Speaker 2: Take a quick break here. When we come back, it's
31:22
time for a little bit of stack Roulette.
31:24
Speaker 1: Breaking business and financial news first throughout the day, only
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31:51
Speaker 4: This segment of the Financial Exchange is brought to a
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part by the US Virgin Islands Department of Tourism. The
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32:24
Speaker 2: Paul, what do you have for me for stack roulette check?
32:27
Speaker 3: I want to talk a little bit about golf, and
32:29
specifically as how it ties into Callaway, who had purchased
32:35
Top Golf back in October of twenty twenty. Immediately when
32:38
the news was announced close to four years ago, the
32:41
stock went down nineteen percent. I think we can all
32:44
agree that Top Golf has a exciting offering that a
32:48
lot of people like to get out there and try
32:50
once in a while. But now I've never been to one.
32:53
Speaker 4: You gotta try it, you gotta go once.
32:56
Speaker 2: I'd like to go once. But again, they're expense they're
33:00
always busy.
33:01
Speaker 3: And that's what I want to get into is the
33:03
price to rent a bay. So one of the driving ranges,
33:07
just for one set up there is about one hundred
33:09
and fifty five bucks for a two hour session. Plus
33:12
you're talking food and drinks on top of that. So
33:14
to Chuck's point, it is relative relatively expensive to go
33:17
out there for the two hour period if you tack
33:19
on the assumed costs of food and beverage on top
33:23
of that. Golf meanwhile, has surged significantly since twenty twenty.
33:27
In fact, they've mentioned that it's been the most significant
33:31
uptick in golf since really twenty years ago when tiger
33:34
Mania really struck the United States. According to an equity
33:37
analyst at Raymond James. Unfortunately, as a result of this acquisition,
33:42
Cowways shares are down fifty two percent since they acquired
33:45
Top Golf. Top Golf had reported that their same store
33:48
or same venue stales had fallen about eight percent in
33:50
the second quarter. And this contrast amusement parks and bowling alleys,
33:55
which have done well during this period of time. There
33:57
just hasn't been the same appetite. And some of that's
34:00
tied into the fact that a lot of companies out
34:02
there that would use this for corporate events they've tightened
34:05
their belts a little bit, so they've seen a drop
34:07
off on sales there. So it really seems as if
34:11
Callaway acquired Top Golf kind of at the peak where
34:14
it was, you know, October of twenty twenty, and you
34:17
didn't have much to do. I can't recall what the
34:20
restrictions were at that point in time, but really a
34:23
free money sort of era.
34:24
Speaker 2: Tucker, you're a big golf guy, I know. Yeah, yes,
34:29
if you were the global president of golf, if you
34:33
ran golf around the world, how would you change the
34:36
game to get more people into it?
34:40
Speaker 4: I mean I don't think I would change really. I
34:43
mean the number one is figure out this PGA live crap, Like,
34:47
figure that out. Just get it over with. Get the good,
34:49
all the good golfers in the same league. Please sure,
34:52
because watching PGA on Sunday has really gone downhill quite frankly,
34:56
you don't want.
34:57
Speaker 2: To see it go the same way that IndyCar and
34:59
Kart went in the States where open wheel racing basically died.
35:02
Speaker 4: In I want to see the best of the best
35:05
compete against each other.
35:07
Speaker 2: I got some bigger things that I would I would do. Okay,
35:11
too many.
35:12
Speaker 4: Holes, It's okay, So you're talking about golf in general,
35:16
how would you change?
35:17
Speaker 3: God, get chuck out there.
35:19
Speaker 2: If you want to grow the game, it can't be
35:23
eighteen holes. And I know you can play nine if
35:24
you want, but like, I'll give you one, make it twelve.
35:28
Speaker 4: I'll give you one. More par three courses, maybe with
35:32
a couple par fours mixed in.
35:35
Speaker 2: And here's the other thing. I don't know if either
35:38
of you have ever looked into the economics of a
35:40
golf course, but they're generally awful unless you're like a
35:44
really premium course. You can't get enough people through there.
35:50
With the land requirements and water requirements and all the
35:52
stuff that you need in order to actually pay for it,
35:55
it's just not affordable for people that scale. And things
35:58
like par three courses where you don't need as much
36:00
land and water and things like that can absolutely make
36:03
it more palatable and it takes way less time. So
36:07
I think that golf is a sport that is so
36:10
inaccessible to so many people because the cost is really
36:14
high and the time commitment is huge. Paul. If you're
36:19
a basketball guy, right, you still play it all?
36:21
Speaker 3: Yeah? Pick up on Thursdays.
36:23
Speaker 2: How long do you play for?
36:24
Speaker 3: Probably the commitments from six to eight thirty eight?
36:29
Speaker 2: No, is that including a couple of beers? After looking
36:31
for two hours here?
36:32
Speaker 3: Two hours? Yeah, I would say two hours? Yeah, all right,
36:35
give me, it's such a hard time here. He answered
36:37
the question wrong in the first place.
36:38
Speaker 2: You're and you're out, you're done. What's the cost to you?
36:41
Speaker 3: This one is ten bucks that it hasn't moved for
36:44
about ten bucks a game. It's ten bucks for the night. Okay,
36:46
but this is because it's subsidized anyway, it's out there
36:49
cheap either way.
36:51
Speaker 2: It's not very expensive to do this stuff. And that's
36:53
why you see more people playing all these other sports.
36:57
You ever see like a bunch of people, like, how
37:00
many how many adult baseball leagues do you see? Not
37:04
many softball? You see some softball here on there. But
37:09
again it's you just don't see a ton of it
37:12
because these are sports that are cost prohibitive to get
37:14
into even to begin with. Yeah, and so it's just.
37:17
Speaker 3: I think to grow them. Softball does a good job
37:20
of making what is a difficult sport a little bit easier,
37:22
and golf could go down the same route where it's
37:25
pretty hard to hit a fastball traveling, not like old
37:27
people are throwing eighty eighty five, but it's hard to
37:30
hit a baseball in general. Softball makes that easier. Golf
37:33
needs something like that to make it easier, to make
37:35
it more accessible. Par Threes are a good example of that.
37:38
I was talking with friends who were out at Treehouse
37:40
Brewery in the Teeks area where they have a nine
37:44
horror colist. But it's it's part three, three large. I
37:46
think there's a par four, part five, but it's short.
37:49
I've played before you played it. It's pretty good, and
37:51
it's all about the food and drinks, and it gets
37:53
more people out there, and I think it gets younger
37:55
people out there too, because it's just for fun and
37:57
you're going to have drinks and.
37:59
Speaker 4: It's definitely way too intimidating to go out there as
38:02
an amateur.
38:03
Speaker 2: And you got to get the cost down and you
38:04
got to get the time commitment down because otherwise it's
38:07
like what I got to spend like five grand just
38:10
to get passable at this? No, that like that. That
38:12
just doesn't work. You've got to figure out a better way.
38:16
And I say, this is someone who loves golf, but
38:17
it's just it's not working for a lot of people.
38:22
We're done for the rest of the day. Back at
38:24
it tomorrow. On the Financial Exchange,