Episode Transcript
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Speaker 1 (00:00):
Hello everybody, this is the Greg Hicks Show.
Speaker 2 (00:02):
I'm glad you tuned in this weekend, or maybe if
you're on a podcast, it might be at three am
in the morning because you can't go to sleep, But
for whatever reason you're tuning in.
Speaker 1 (00:10):
Thank you.
Speaker 2 (00:11):
I'm Greg Hick, certified Financial Planner, along with Wanda Cooper
Financial Advisor and bo Nicholson.
Speaker 1 (00:16):
C FP as well.
Speaker 2 (00:20):
By the way, Certified Financial Planners finally got over one
hundred thousand in the United States just the other day.
I'm like, okay, thank you. I remember when I got mine.
Nobody ever heard of a CFP. But anyway, congrats to
all the CFP candidates. But anyway, if you're a new
listener to our show, we are all about money and
(00:41):
financial planning and investing and all sorts of things. We
have a unique show in the sense that we do
different topics every week, and we cover a broad base
an arena of a financial planning ideas and strategies, and
we cover a lot of things. So if you're a
longtime listener, welcome back. You know what I'm talking talking about.
And if you're a brand new list er, maybe you
(01:02):
just moved into the area from somewhere like a lot
of other people. Or maybe you just got laid off,
or maybe you just inherited money or got a divorce,
who knows, but you're listening to get some advice, and
our show is full of it every week, so we're
glad you tuned in. Today we're going to talk about
something that no one's interested in the stock market. Oh
I'm sorry, I'm sorry. That was a joke. But today
(01:25):
we're going to get into that heavy and deeply and
really bring out some really cool stuff you may have
never thought about or perhaps never heard about. But we
always take the first segment of our show to talk
about current events. So there's a lot of current events
going on. There's a you know, Trump is over in Asia,
in Saudi Arabia and doing his thing, and a lot
(01:49):
of amazing stuff's happening in that area. And in the meantime,
Congress in the Senate are you know, blabbering about each
other's weaknesses, and the House and it particularly is trying
to get there calling the big beautiful bill. They meaning
they're meaning the tax cuts to make them permanent from
(02:10):
Trump's first administration.
Speaker 3 (02:12):
Is so to remind me of rock them sock on robots. Yeah, yeah,
who last hit the first hit?
Speaker 1 (02:18):
Yeah?
Speaker 2 (02:18):
And who's lying and who's not? I think we kind
of know that answer. But anyway, I just wanted to
just do two or three little highlights. This is what
they're they're trying to eliminate over time, some of the
the free gifts to the credits for buying an electric vehicle.
They're trying to eliminate some of the clean energy breaks,
some of the green energy breaks.
Speaker 4 (02:40):
Uh.
Speaker 2 (02:41):
They're trying to keep manufacturing tax breaks to stimulate job growth,
which is cool. There, let me see what are some
other senior deduction Okay, if you're over sixty five, Uh,
they're going to try to give you an additional four
thousand dollars deduction off your income taxes.
Speaker 3 (02:58):
They're also Social Security not taxable.
Speaker 2 (03:00):
Are they not working on that? That was the second
thing I was going to say. One the way to
jump in there.
Speaker 3 (03:05):
I want to hear it.
Speaker 2 (03:06):
And why do when you're serving tables on the weekend
part time, your your tips will be not taxed?
Speaker 1 (03:12):
Aren't you excited?
Speaker 3 (03:13):
Oh? I'm so excited about that.
Speaker 5 (03:14):
Yeah, I know your hairdresser barrel, that's right, and my
hairdresser she's excited my wife's hairdresser because because she gives
too much tip, my wife and.
Speaker 2 (03:26):
I argue about tipping her hairdresser. But anyway, the hairdresser
is excited about the Trump plan. But anyway, those are
things that are happening and you can't do anything about it.
Don't listen to too much media because most of them
are exaggerating and lying. But uh, it's looking like it's
going to pass, and it'll all be good in the
end because everybody will pay less taxes. So let's don't
(03:47):
get outside of the box.
Speaker 1 (03:50):
Here.
Speaker 2 (03:50):
By the way, I always do this every once in
a while. If there's a tax cut, uh here, and
you've heard me say this on the show before, the
top one percent of taxway earners pay forty percent of
the federal taxes, and the top ten percent of wage joarners.
Speaker 1 (04:09):
Pay twenty five twenty four.
Speaker 2 (04:11):
Times more taxes than the bottom fifty percent of working Americans.
Just to give you the truth, if there's a tax cut,
the higher earners are going to get it because the
lower earners don't pay any.
Speaker 4 (04:24):
Well, that's why I'm so amazed at the fight and
the arguments that are going on about doge because they're
finding these issues. But and if you're a taxpayer, you
care about.
Speaker 3 (04:35):
It, you really do. I do.
Speaker 4 (04:38):
And then the media, of course they say stock surge
on thaw in trade.
Speaker 3 (04:45):
Conflict, I mean, and all that.
Speaker 4 (04:48):
They don't give Trump or any of that any credit
for the SMP going up or anything. It's all you
don't hear anything. So it's just it's just funny how
media is and how they can drive what people think.
And I'm like, don't listen to the media to get
your news. You do your own research. You can't believe
everything they say.
Speaker 1 (05:07):
Yeah, good point.
Speaker 6 (05:09):
Well, to be fair, there was one person who lit
the fuse on that sell off and he's been backing
off ever since. And so I think him backing off
and realizing that I want to touch the stove, Oh wait,
the stove is hot, and pulling his finger away that
caused the market whip saw. And so I get both
sides of that argument. And we're not any better off
than we were when we started the year in terms
(05:30):
of trade. And I know there have been some exclusions
for you know, chips and some automakers and other things
like that, but I don't know it. We're kind of
in a wait and see pattern right now with all
this all this tariff stuff.
Speaker 2 (05:43):
But I will say this, boy, when I listened to
the analyst on Wall Street dooming and glooming of recessions.
Speaker 1 (05:49):
Coming all, they're all bragging about we never.
Speaker 2 (05:52):
Are emotional, we plan way ahead. Oh yeah, they sounded
just like a person on the street.
Speaker 6 (05:57):
That's outrageous.
Speaker 1 (05:58):
That that really made me angry.
Speaker 6 (06:00):
I've lost some respect for a lot of the talking
heads that I really look up to, or have looked
up for for a long time, because their political bias
really got exposed in the past month and a half
with them calling like you said, you know, we're going
to go into a nasty recession, And I think the
chance of a nasty recession is probably off the table
(06:20):
at this point. I think we could I think we
could go.
Speaker 3 (06:23):
I think we have been helped.
Speaker 6 (06:25):
But in terms of the numbers on tariffs, we're not
better off than we were just factually, we're not better
off than we were in January.
Speaker 1 (06:32):
But this is an.
Speaker 6 (06:32):
Interesting stat This should give people some optimism. And this
is I got to attribute hal Letens for this because
he's kind of our market historian. But there have been
forty one years with double digit drawdowns at some point
since nineteen fifty, the S and P five hundred finished
with a game twenty five times, or sixty one percent
of those times. Of those twenty five years with double
(06:53):
digit drawdowns that finished in the black, which means positive
sixteen times, the market ended the year with double digit gains.
So to break that down in years with a correction
of ten percent or worse in the stock market, the
market's been more likely to finish the year with gains
than losses, and more likely to finish the year with
double digit gains than double digit losses. So it's kind
(07:16):
of a classic puke and rally situation, right. So like
we've had our the slingshots been pulled back at this point,
and now it's been released. What do you do well?
I mean, don't do it blindly. You should call an
advisor and sit down and make sure what you're doing
makes sense for your plan. But there's some optimism to
be had based on what history says, so call us
nine one nine eight five six one six eight.
Speaker 1 (07:37):
You know.
Speaker 2 (07:37):
The the other thing I thought There was two articles
in Wall Street during the last couple of weeks talking
about the investor on the public square bought or did
no trading in the great crash we just had. But
the Wall Street experts sold. Real guy wins again the
retail the normal person on the street it right after all,
(08:01):
and the big guys that are so smart blew it.
And you wonder if they bought back yet too, You know,
that makes me wonder. But anyway, again, sometimes just just
hold onto your horses and don't panic.
Speaker 6 (08:13):
There was a real cocky article that somebody referenced during
that time and it was like the days of Main
Street beating Wall Street are over? Yeah, And that sentiment
lasted like three or four days.
Speaker 3 (08:24):
Yeah.
Speaker 6 (08:24):
I was like, okay, retail guys, got you cooked?
Speaker 1 (08:27):
Yeah, exactly.
Speaker 2 (08:28):
Yeah, so a lot of times, and I think we
all noticed that we all got a few calls during
that time, and the majority of my calls were what
are we buying?
Speaker 1 (08:37):
They instinctively needed to buy low.
Speaker 6 (08:40):
We'll get into that.
Speaker 1 (08:41):
We did.
Speaker 2 (08:43):
So we're by the way, our show today is on stocks,
So if you're interested in the stock.
Speaker 1 (08:47):
Market, hang on.
Speaker 2 (08:48):
We're coming back where else And all right, everyone, welcome
back to the Greg Kicks Show. We're kind of having
fun today because we're talking about stocks. Our topic of
the day is stocks and stock markets and how do
you do it?
Speaker 1 (08:59):
What do you do?
Speaker 2 (08:59):
What does all this stuff mean? And couldn't be better
timing with the market going crazy down almost to the
correct way below correction, almost to the bear market, and
then back up again. So it's basically almost positive for
the year.
Speaker 6 (09:13):
Anyways, happened this year? Let's shut your eyes on January first?
What happened?
Speaker 1 (09:18):
Yeah, that's true.
Speaker 2 (09:19):
If you had a three month vacation, your god, did
anything happen?
Speaker 1 (09:23):
But anyway, I thought it was fun.
Speaker 2 (09:26):
Again, Well, I've got several things, and then at the
end of the show, we're going to have a special
guest at some of your radio listeners know, well, who's
a guru in the stock market. But I thought this
was like fun stuff, y'all. The stock market history is
full of interesting things. But anyway, if you had bought
applestock in nineteen eighty five, you're up one hundred and
(09:48):
sixty five thousand percent.
Speaker 3 (09:49):
God, why Bobby probably did.
Speaker 2 (09:54):
Winda had a class ask what he was going to
do in the future, So just tell him you would
have apple in eighty two.
Speaker 3 (10:01):
And interesting enough, he's got Apple in his a case.
Speaker 2 (10:04):
Oh god, well, counting all the splits, the stock was
worth twelve cents a share in nineteen eighty five, and
that one two hundred and ten.
Speaker 1 (10:12):
But what about Costco?
Speaker 2 (10:13):
What if you had have bought Sears, Kmart and Costco
back in nineteen eighty six. Sears and Kmart are gone,
and Costco's split share price that year was nine dollars
and it reached one thousand dollars a share recently, So
you're up over nine thousand percent. And that's the point
of the stock market. You can go bad bad overtime,
(10:35):
and you can go up up over time. And if
we did know the future, we don't have, you know,
I used to I usually tell clients if God had
an eight hundred number, I can make you very wealthy.
Speaker 1 (10:45):
But we don't know the future.
Speaker 2 (10:47):
So the market is fun, exciting, and it is historically
it's the number one best return of any investment category
you can do, is the stock market. So that's why
we're taking our show today and talking about it because
there's so many interesting things about.
Speaker 6 (11:02):
It, but it moves so quickly and it scares a
lot of people away for that reason. And like we
talked about in our first segment, the all caps headlines
that are so prevalent when the market does things like
it did at the start of this year. You know,
the guy who called the two thousand and eight crash
is saying it's gonna happen again. This time's going to
be twice as bad. And you're like, oh, gosh, I
know I shouldn't believe that I should put my head
(11:23):
in the sand, but it's hard when I check my
account balance and my balance is down. And the stat
that we've brought up on the show before is the
market hits all time highs seven percent of trading days.
That's that is the statistic, and that's a hard word
to say, statistic. So I remind people you might check
your account at an all time high, but there is
(11:43):
a ninety three percent chance that when you go back
and check it again that you're not going to be
at that all time high. And that can cause your
emotions to go a little crazy. And for the past
two years, the market's been going up, up, up, up, up,
up up up, and then finally this year we had
some violatility, and I think what that did is it
caused some people who maybe got a little cocky with
(12:04):
their Robinhood accounts and they're you know, personally managed accounts,
and they were just throwing stuff at the wall and
buying whatever, and it was going up and they felt good.
It's easy to make money in the stock market. And
then the stock market does what the stock market always does,
and it reverts and it comes back down, and that's
when the emotion changes from I'm a genius to oh gosh,
(12:25):
I'm an idiot. I'm gonna lose everything. I gotta sell.
I got to get out before this gets worse. That
is the time where advisors really show their benefit and
their true callers. Yeah, because we were making a lot
of outward calls to clients during that nineteen percent drop
to say, hey, you got some cash in your account,
(12:47):
let's throw this cash in because things are on sale
right now twenty twenty five percent off their highs. We
think this is a good time to enter. We had
a couple clients, really not many at all, call us
who were worried about, Hey, what do you think is
going to happen? Are we going to be all right?
And the answer you always feel like, well, this time
is different. You know this time is going to be different.
(13:08):
I just feel it, and it's like, no, what you're
feeling or is you're feeling emotions, And what I'm feeling
is the urge to really do my job and show
my worth right now and give you the objective, the
objective answer, and say, look, we got to stay the course,
we got to plan for this. Let's take some cash
and lesten to this.
Speaker 4 (13:23):
You know, I ask, I have not used this AI feature,
but I wanted to take a little stab at it,
and I said, what does a financial advisor role?
Speaker 3 (13:33):
What does that do?
Speaker 4 (13:34):
And it actually came up to things that I actually do,
which was I was amazed, Like, you develop investment plans,
you choose investments, you monitor them, you adjust the portfolios.
Speaker 3 (13:46):
So that's what we do with stocks.
Speaker 4 (13:48):
And interestingly enough, I had a meeting recently with a
lady that was referred to me by an existing client,
and she said, I've never done the stock market. My
husband is ready to jump in and he wants to
buy this stock that you know I won't mention on
the air, but it's a brand new one.
Speaker 3 (14:06):
And and I said.
Speaker 4 (14:07):
Well, you know, I mean, you know, sometimes getting in
on the ground floor could be good, sometimes it may not.
And I said well, what tell me stores and companies
that you are comfortable with, Like, like, if you if
you could own a company, what would it look like.
She said, well, I like Costco. She said, I'm not
(14:29):
afraid of that. And I said, well, that's interesting. We've
bought Costco before. And then she said, I'm not afraid
of Protter and Gamble and I said, we bought that before.
Speaker 3 (14:40):
So said, there are.
Speaker 4 (14:41):
Companies that that people can be comfortable with. And if
you mentioned it in that respect of what companies would
you like to own, if you could own any companies
in the world, what would it be?
Speaker 3 (14:51):
And then you go, well, that's the stock.
Speaker 4 (14:53):
And by the way, they pay a dividend, and if
you reinvest that dividend, you're buying more of those shares,
So you're buying ownership into these companies that you love.
Speaker 1 (15:01):
That's true.
Speaker 4 (15:02):
When you describe it that way, people are a little
less afraid.
Speaker 6 (15:05):
Peter Lynch had a rule. He's a legendary investor. Buy
what you know. And so you know, you buy Dominoes,
you buy Apple, you have an iPhone, you buy Disney
because you took your kids to Disney. It's not the
only thing you buy. But it's a great starting point
if you're getting into it.
Speaker 2 (15:21):
By the way, Peter Lynch was the manager of Fideli Magellan,
which was like Warren Buffett today, like it was number
one mutual fund forever in the eighties. Anyway, one of
his greatest buys was Haynes Brand. He said, you know
how you know the research I did on it. We
were at a barbecue and all the women were talking
about buying pantyhose and eggs.
Speaker 1 (15:42):
Yes, he went, he went, I got to look that up.
Speaker 2 (15:45):
And he hit a home run because he listened to
the women, like what are the people on the street
interested in? By the way, y'all, hear's some fun stuff
this data. When did the stock exchange actually start? The
New York Stock.
Speaker 6 (15:57):
Exchange eighteen seventy two.
Speaker 2 (16:00):
Okay, I was thinking in the eighteen hundreds. It started
in seventeen ninety the American Stock Exchange and the government
issued bonds to sell so bonds that's not the stock
exchange but bond exchange. But only two years yeah, yeah,
that's right. It's been bad, but only two years later,
(16:20):
seventeen ninety two. I'll read this little thing. It says
some people got together and the merchants up in New
York City and they started talking about opening something where
they could trade each other's securities in ownership. And that's
how it started in seventeen ninety two. And the point
(16:41):
of me saying that is there's a bowload of history
in the stock market. And you'll hear bow and wind
and I talk about in the past. This we're talking
about history.
Speaker 1 (16:52):
Just like in anything in life. Let history be your guide.
Speaker 2 (16:55):
And history does repeat itself sometimes, but history also teaches
you so much wisdom.
Speaker 1 (17:01):
What to do and what not to do.
Speaker 2 (17:03):
And luckily in the stock exchange world, there's a boatload
of history. And like bow Red hal eddins idea is
like go back and say, Okay, something's happening, what is
the historical data on it?
Speaker 4 (17:16):
Well, you know I get this comment too, and I
know you guys have gotten it to I've never owned stocks, yeah,
I said, do you have a four to one k? Well, yes,
that's mutual funds. Though I'm like, okay, well, let me
give you a little lesson mutual funds are a basket
of stocks. Yes, you own stocks if you've done any
(17:38):
type of four to one K investing or you know,
simple iras or whatever, and you've done it with mutual
fund companies, you've owned stocks. So if you're out there
listening today and you or have been in the stock world,
maybe you haven't give us a call nine one nine
eight five six nineteen sixty eight. We're happy for you
to pick our brain as a complimentary appointment.
Speaker 6 (18:00):
And mutual funds are an easy way if you have
a little bit of money to get started with an
active management approach. And basically what that means is you're
giving your money to this fund, but the fund is
effectively an institution, and there's a specific investment target or
investment goal for each one of those funds. Maybe you're
investing in a US growth fund. Well, the way that
(18:21):
it works is there's managers that set up in New
York or wherever they are, who control what's in this fund.
They buy stocks, they sell stocks, they buy whatever else,
and they sell whatever else. Well that's all well and good,
but we've mentioned this on the show before. If you're
doing that in a taxable account, all those moves that
they're making buying this, selling that, buying this, there's tax
ramifications associated to that, gains and losses and all that stuff.
(18:45):
They're passed through to the end investor. And so if
you own mutual funds in a taxable account, there are
better ways to do it. They're what's called exchange traded funds.
If you like having that diversification, you like taking money
and investing it in US growth companies, you can invest
in a US growth Jane's traded funds and energy. Yeah,
you can. You can get as you can get as
granular as you want to in your investing style. But
(19:07):
understand remember it's what you keep, not what you make.
And with mutual funds, oftentimes you're making less because you're
having to pay a tax consequence. So just keep that
in mind. But that goes to the manager's story and
how how managers work. Money managers. So Wanda, Greg and
I we're all licensed to manage money, and we do
(19:28):
that for certain clients, but oftentimes what we do is
we hire in a money manager that we've worked with
for a long time, that we trust, that we've vetted
for ability and integrity, all that kind of stuff, and
as part of the fee that you pay to us,
we pay to them. And so we're going to talk
about that a little bit more after this break. Y'all
stick with us, and we'll talk about all the different
investing styles that you can have if you come to
(19:50):
work with Financial Resource Management.
Speaker 1 (19:51):
Be right back, Welcome back to the grad Kicks Show.
Speaker 2 (19:54):
We're in the second half of the show now on
stocks and stock investing, stock markets, how do they work,
what's the history. It's the best investment return in recorded history.
So you need to be in it. But how do
you get in it? And what do you do? And
who do you trust and all those things. I want
to remind you that we have a website FRMNC dot
com that fr M and C simply stands for our
(20:16):
small business Financial Resource Management, headquartered in Rileigh, North Carolina,
one of the great growth cities in the in the world,
I guess. And then also we have an office in
the Moreheads City area right on the Crystal Coast Atlantic
Beach Causeway, which has a beautiful view of the harbor.
So we're we're we're we're doing a lot of stuff.
(20:37):
We cover a lot of territory with all of our
shows and financial planning and investments and taxes and whatever,
and so the best way to contact us is through
the telephone number eight hundred and four eighty seven, one
seven eighty six, but also meet us in our offices,
but if you can, we will meet by zoom. But
we love office meetings. It's nothing like a personal touch.
(20:59):
If you're going to have an advisor, you need someone
you really inherently trust, or else it's not going to work.
So meeting you in person is our choice if we can.
But a radio phone call is the way to get
a hold of us nine one, nine eight five six
nineteen sixty eight. The website FRM stands for a Financial
Resource Management in c is, North Carolina, So go there
(21:21):
to check us out frmnth dot com. Okay, this segment,
we're going to talk a little more about stocks and
how to view it, and I'll just open up with
a few ideas. Over the history of stocks is an
extensive history. There's been different kind of styles developed, what
to look for, how to diversify assets to reduce risk.
(21:43):
There's large company stocks, there's small company stocks. There's USA,
we have the biggest stock market in the world. But
then there's there's markets all over the world. There's international
stocks you can buy. You can diversify between all of
the above. There's something called gross style and value style.
That's a simple one to kind of understand. Growth would
(22:05):
be what's hot. Like AI companies are high growth, they're
all about growth. Value stocks are like Wanda mentioned earlier
in the show, like Procter and Gamble, Like for example,
Pepsi is at a five year low right now, they've
increased their dividend for sixty three years. We're not recommended
that to you, but you might want to check out
pep not as a drink, but as a stock. For example,
(22:27):
that's called a value stock. It has great value and
potential growth, but it also spins off dividends.
Speaker 1 (22:33):
So there's so.
Speaker 2 (22:33):
Many little things like that that are involved in his advisors.
That's what we need to be cognizant, cognizant of to
help people.
Speaker 4 (22:41):
Well, yeah, you know Bobby's is going to join us
in the last segment and Bobby Rice. Yeah, Bobby Edgerton, Yeah,
I think everybody knows him and we've had him on
the show several years. But you know, he does the
most interesting thing. I don't think he does a lot
of computer generated you know, recommends. I think Bobby literally
(23:02):
reads every analyst report and value line and things like that.
So I kind of learned from him how to use
street wise when choosing a stock. You know, it's not
just about the plugging it in and see where it
lines up on that chart. It's about understanding what you're buying. Like,
for instance, I'm a I'm a Ross shopper, and years ago,
(23:24):
I thought I want to buy some raw stock, and instinctively,
though you know, I was feeling the push of other
people that were saying retail is not a good thing
to get into. Retail is not a good thing to
get into. Well, look where Ross is now. Instinctively I
was right, and and and dollar general, same thing. I've
been waiting five years to buy that stock, been watching,
(23:45):
watching and watching, and it took a little dip recently
and I jumped in with both feet and thought, yeah,
I'm so glad because it's needed for sure. But but
a lot of this instinct to style for long terms
that have done this a long time is not plugging
things into computers. It's looking at balance sheets. That's the
(24:07):
first thing you look at when you and I talk
about a stock.
Speaker 1 (24:10):
Let's look at the balance sheet.
Speaker 4 (24:13):
I look at beta, And because when I was in banking,
they taught us beta, meaning that amount of risks that
you're taking compared to the market. And so when I'm
looking at a client that's a moderate risk, I'm instinctively
looking for a stock that the beta is less than
one one or less. So you know, all those things
that I learned over time is so much more valuable
(24:35):
to me than being able to use the software. I'm
not dissing software because obviously I looked at AI recently
and said, what is it that I do as my job,
and it was was right on target. But I still
like to use those instinctive things that I have. And again,
we all three come from different ends of the spectrum
as far as investing. We all bring something to the table.
(24:58):
So if you're interested in meeting with us, give us
a call at nine one nine A five six nineteen
sixty eight to schedule your complimentary meeting.
Speaker 6 (25:06):
Yeah, and Bobby, as you'll hear in the next segment,
is just a wealth and knowledge because he reads Baron's
cover to cover every single week when it comes out
the Wall Street Journal. He studies value line, which is
like the company's fundamentals and all their numbers. But another
thing that I respect that he does is really get
to know the CEOs, and he watches all the interviews
on MSNBC and elsewhere with the people who are leading
(25:28):
these companies, And how do I feel about this guy?
What's his past history? Do I trust what he's saying
to me? Interview well? Does he interview well? Or is
he just spinning the numbers to make it look good
for investors. Bobby's got a pretty good BS meter when
it comes to that. And another thing I like about
Bobby and some of the other managers that we use
is this is all they do. So like all Bobby
does is read and invest in stocks, try to pick
(25:50):
stocks to invest in. We're all fully licensed to do this.
But before the break, we were talking about the different
styles that you can take with managers. Let's just say
you pay a fee of one point twenty five percent
to your current money manager and they're at a big wirehouse,
you know, They're at a Morgan Stanley, Merrill, Edward Jones, whoever.
Oftentimes that client will come into the office and they'll say, yeah,
(26:12):
I've got an advisor. You know, I'm just coming here
for a second opinion. Okay, what do you think your
fee is? And they'll bring a statement in. I'll be
looking through it, and I can see that their listed
fee is one point twenty five. Well, my fee is
one point twenty five, it says it right there. All right, Well,
let's just take a look at who's managing the money
behind the scenes. You've got Blackrock, you've got Clearbridge, you've
got London Company, you have all these managers who are
(26:34):
managing different sleeves of your account. Well, what you don't
know is those managers are maybe charging you zero point
three to zero point five. And so I'll tell that client,
after analysis, your fee is actually one point seventy five.
Your total fee that you're paying is one point seventy five.
And then I'll show them the first page of our agreement,
(26:56):
our new account agreement, and what it shows is it
shows here's your fee, and here's how it's split up.
Your fee with us is whatever, and of that fee
that you pay, here's who gets this part, and here's
who gets this part. There's no back door behind the
scenes fee as there are oftentimes at a lot of
these big wirehouses. And so I just think it's important
(27:17):
for our listeners to understand that and really know what
you're paying for the value that you think you're getting
and so if you want an analysis done on your
statements to see you know what your fee is, give
us a call A nine one nine eight five six
one nine six eight.
Speaker 2 (27:31):
Another thing that I want to point out too is
the risk aversion. A lot of people are afraid of stocks,
and everybody has a risk. We actually do, and Bo
mentioned paperwork. In the paperwork, there's a risk profile. We
ask you a few questions and tally up a number
and it tells us pretty close what kind of risk
you have before you ever start investing in stock. So
(27:54):
if you're a low risk, metior, moderate, or high, we
can do it whatever way you want.
Speaker 3 (27:59):
You make money vest you that way too, Yeah, and we're.
Speaker 1 (28:01):
Going to stick to it.
Speaker 2 (28:02):
And you may have an IRA you want to be aggressive,
and you may have a traditional broke's account you want
to be moderate. You can also do that. Maybe you
have a husband and wife with different risks. You can
have different accounts. So we do all that. I just
wanted to mention two or three bullet points real quick
on risk. One major way to divert risk, avert risk
(28:23):
and difuse it is to diversify critical. Critical point diversification
is as old as King Solomon when he wrote three
thousand years ago, to spread your bread among many waters,
where you do not know what is to come. How's
that for three thousand year old advice? Bilows sell high.
That's still the only way to make money, and people
forget that. They want to like they want to buy
(28:45):
Costco today, wanted to mission Costco's near an all time high. Well,
wait until you have a bad market and you might
be able to dip into it. Keep some cash around always.
We always have spare cash for something that might come
along and go, oh my god, gosh, I want to
buy some but I don't have any money. We always
keep a percent in cash, maybe ten percent or whatever
(29:06):
the number might be. And then we've all said this,
but have an advisor because there's nothing like having a
different set of eyes on your account that's so critical.
Speaker 1 (29:16):
And I will say this.
Speaker 2 (29:17):
I ran into a person recently that met with their
advisor and they asked a question, do you think we
can retire soon? And he said pretty close? And they said, well, well,
how did we do this year? And he said pretty good?
Speaker 1 (29:32):
I'm serious. I went, I know, I went, you got.
Speaker 2 (29:36):
To be kidding me, And they said, that's why we're
coming to you, but that's not advice.
Speaker 1 (29:43):
You need data. You need data to think logically.
Speaker 2 (29:47):
Good night, And you know.
Speaker 4 (29:48):
My aversion to risk to charts and graphs. I think
you know that after all these years. But there is
software we use for that very reason, and numbers do not.
So I can actually show you year to year what
your performance has been in each account, and I can
show you collectively what you've done. Yeah, So I don't
(30:12):
like to spend a whole lot of time on the
chart one that shows the chart, but I do like
to show clients in writing what they've done in each
account year over year, and that's helpful.
Speaker 3 (30:22):
That's history, but it's your history.
Speaker 2 (30:25):
We advisors have to be accountable just as much as
anybody else, So to give vague returns and comments like that,
it's not right.
Speaker 6 (30:35):
Well, I'll play Devil's advocate here because I can't tell
you how many meetings I have, well over half of
them where a client comes in and we sit down
and we just chat about what's been going on in
their life and what they're doing, and you know, maybe
their income playing a little bit. And I've got the
folder with their review in it. But that folder doesn't
get opened. Oftentimes we don't look at their numbers because
(30:58):
they don't care and they don't ask what they really
want to know, and they trust us. I mean, our
clients trust Greg, Wanda and Bow at this point. They
want to know when they come in and we have
that catch up conversation, Am I still good? Am I
still going to be okay? And I always let them
know and open up the door to say, look, if
you want to get in to the nitty gritty and
granular details and run a financial plan, we can certainly
(31:20):
do that. But I've found and I came from Mary
Lynch and we used to do these financial plans, these robust,
you know, one hundred page plans for everybody, but you
to just get lost.
Speaker 3 (31:30):
And they do free lean over. Yep.
Speaker 6 (31:33):
It is not beneficial in my opinion. And oftentimes people
get too attached to those Oh I have a ninety
nine percent chance of success and retirement, and then they
get too cocky with their money and that ninety nine
percent drops to it.
Speaker 3 (31:44):
Maybe maybe they.
Speaker 4 (31:45):
Want to pull out twenty thousand to go on that
Caribbean cruise.
Speaker 6 (31:48):
That's right, And so what I've found, if this is
not me being cocky is that I can do oftentimes
just as good of a simplistic financial plan that gives
people confidence on a legal pad or a sharpie, just
showing them the numbers and how it's all going to work.
And so regardless of your style and what you want,
we can help you out. Give us a call nine
one nine eight five six one nine six eight. Y'all,
(32:08):
we's got Bobby Edgerton joining us for the final segment
of this show. Please stick with us, we'll be right.
Speaker 2 (32:12):
Back, all right, So, welcome back to the Great Hicks Show.
We have our very special guests that we've had on
our show for many years, Bobby Edgerton, money manager for
Capital Investment Group or counsel, and he is he's been
in the market a few decades and very smart intuitively
and a great communicator. So Bobby, we've done a lot
(32:33):
of detail on stocks and markets and history and growth
and value and all that. And you're you're the ending
note of the show, and we're glad you're here. Welcome back,
and we're just curious, like what you're looking at today
in this kind of market. We've had this gigantic crash
and recovery, so we're all ears today, Bobby, So take
it away.
Speaker 7 (32:55):
Okay, Well here you and I've always liked buying stocks
that had a lot of cash and not much of
any debt and hard to get in trouble when you
don't have debt. It's easy to get in trouble when
you got debt. So I have a lot of and
when I'm dealing with other people's money, my number one
goal was not to lose them much money. I normally
(33:18):
make them money if they're patient. And because all these companies,
the cash flow they have every year, it just it's
like Coca Cola, for example. If your cash flow and
fifteen billion dollars a year in five years, that's seventy
five billion that's added to the value of the company.
You got to believe that the stock is going to
(33:39):
go up with that. But right now, but you know,
we got the tariff situation. I hope the government can
deal with that, and I wish them all the best.
And but I'd say, right now, Procter and Gambles sure
makes sense to me. It's now from eighty to about
fiftyifty nine or sixty. John Mueller is one of the
(34:02):
smartest guys around. He's been there over twenty years. He
was the chief financial officer for a long time and
now he's the chief executive officer. But a nice man,
a very conservative man. And they had twenty four billion
in cash flow last year. They do have thirty six
(34:23):
billion in debt, but when you got twenty four billion
in cash flow a year, that's pretty good. Killing this
gigantic warehouse factory down in Louisiana that's two and a
half million square feet, they're taking down some of the
old factories that built tide and Pampers and stuff like that.
(34:46):
I like everything they doing. I like the stock prices
down when a lot of stock prices are up. And
if you can't they got twenty five products that generate
over a billion dollars in cash a year all of
ola to let that kind of stuff. Wow, So that's
a pretty good You know, you want to keep your
(35:06):
clients happy and comfortable, and if you can't be comfortable
with a propery and gamble, you probably don't belong in
the market, right.
Speaker 3 (35:14):
Exactly, sentiments exactly, that's cool.
Speaker 1 (35:18):
Uh, Bobby.
Speaker 2 (35:19):
The last time you were on you mentioned Mercedes and
we bought it, and we bought it and it went
down even further, and they just paid out an eight
and a half percent dividend they pay annually. So my
clients that we bought Mercedes, that dividend made him feel
pretty good.
Speaker 7 (35:36):
Well, you know, it's funny. I have a lot of
clients have been with me twenty twenty five years, and
for example, my cost On I bought Costco for eighties
one thousand. Now, stuff like that kind of takes. These
big companies take care of you over the years if
you'll leave them alone. And but I think the building
(36:00):
of the digital economy which we're in is software and semiconductors,
and that's my favorite bunch. I watched the Cadence Design
System on Kramer day before yesterday and the stock was down.
It's got me excited. Now it is back up at
the high. But these tech companies tend to have a
lot of cash and not much debt, and they're vital.
(36:21):
So I'm talking about the Amazons and the Microsoft's and
the Googles of this world, which is alphabet and you know,
Apple sits on one hundred and thirty three billion dollars
in cash. But I think the biggest misconception that so
much of the public has is that stock market is
kind of a gamble. Well, if you think owning Walmart's
(36:43):
a gamble, you need to learn a few things. So
it's a gamble if you're going to sell if it
goes down. But we don't do that. We buy it
when it's down. If it goes down anything, we buy more.
A lot of the these big companies, they have their
(37:03):
artificial intelligence stuff and their stuff hooked up for computers,
and what they do is a lot of times if
your stocks are down six or seven percent, they have
a program to sell. Well that's pretty stupid in my opinion.
You don't sell good stock when they're down. If you're
ever gonna sell, you sell when they're up.
Speaker 3 (37:21):
Can I ask you a question right here? You mentioned Google.
Speaker 4 (37:24):
How do you feel that the AI world could impact
Google stock?
Speaker 6 (37:30):
I'm just at Apple replacing it.
Speaker 7 (37:33):
Yeah, Well you're looking at basic search against AI search,
and I don't think anybody's gonna totally replace them. They
got a lot of other business of going. They got
about ninety five billion in cash and that's maybe thirty
five billion. But everything is competitive, just like sports nowadays.
(37:54):
And I think Google Alphabet is the least liked of
what I call the Big six, but it's uh. I've
had it for a long time. As long as they
got that Fort Knox balance sheet, I'm okay with it.
My biggest position, by far is Apple, and I trust Apple,
(38:16):
and the last thing people are gonna get rid of
are their funds.
Speaker 1 (38:20):
Yes, yeah, at that point, I think.
Speaker 7 (38:22):
And Tim Cook's done a fabulous job since he's been in,
and Apple's had a somewhat of a little bit of
correction in here lately. I think it's down from like
two sixty to to ten. But that's my biggest position.
And I think if you're gonna give you money to
somebody to manage, just ask them to show you their
(38:44):
statement too.
Speaker 1 (38:46):
Yeah.
Speaker 7 (38:47):
If they tell you, if they tell you that you
ought to be in this, I say, do you own
it and show it to me? You know, well I
do that.
Speaker 6 (38:58):
Yeah, that's a good way to do it.
Speaker 1 (39:00):
Well.
Speaker 6 (39:00):
Back on Apple, Bobby Warren Buffett two weeks ago called
out Tim Cook and he said, you're the only earnings call.
I listened to it because I'm not interested in the
way that CEOs will spin the story. I want to
know the numbers, and so in a way that really
reminded me of you. But I know that you put
a lot of faith in CEOs of companies, and you
like to get to know who's leading certain certain companies
(39:23):
in what direction, and you watch all their interviews on
MSNBC and CNBC and everywhere else. Can you talk a
little bit about how important it is to understand kind
of who's at the helm of these big companies.
Speaker 7 (39:37):
Is vital?
Speaker 3 (39:38):
Yes?
Speaker 7 (39:38):
And you know you can. You can google say Walmart
CEO interview and listen to the Walmart Uh, the Walmart
chief financial officer just got off and uh, Doug McMillan is, Oh, sorry.
Doug McMillan is a smart guy and a nice guy.
And I like nice guys, nice women running companies. I
(40:02):
don't like people that I suspect might try to sell
the company or leverage it up. That's pretty important, just
like just like a basketball coach.
Speaker 1 (40:13):
Yeah.
Speaker 6 (40:13):
No, I love your analogies to sports. It helps break
it down for people who might not be understanding of
this stuff. And back on a quote you mentioned earlier
stocks typically work out for you if you leave them alone.
I think about the other quote that sometimes the best
strategy is doing nothing. You know, and this was realized
about two months ago with all this teariff stuff. When
(40:33):
the market dropped nineteen twenty percent, some people freaked out.
Some people may have gone to cash. You know, there's
unfortunately some investors out there that let their emotions get
the best of them. But I remind my clients I
know Gregor want to do too. Y'all are long term investors.
You're not traders. And there's a stark difference between a
long term investor and a trader. And I think that
(40:54):
you also, Bobby like working with the long term investors
and probably classify yourself as one. Even though you're the
one out there buying and selling these stocks, you're not
doing it on a repeatable basis, or you're not You're
what am I trying to say? Your activity is not
very high. You're buying a stock and you're committing to
that idea and that concept for a long period of time.
(41:16):
Can you talk a little bit about that.
Speaker 7 (41:17):
Yeah, Well, Obama up raised a capital gains tax from
fifteen to twenty percent and then put a three eight
Obama tax, which is the Affordable Care Act, and then
you got fied for the state. So when you got
big profits and you're going to pay twenty nine percent.
It's not easy to get that back, right. So the
two ways you make money in the stock market you
(41:39):
buy great companies with great balance sheets, a lot of cash,
not a whole lot of debt, and you hold them
for life. And then the other one is if you
buy a good stock when it's down and it goes
way up, and there's two or three just as good
as companies down, especially in an IRA or a non
taxtble account. Nothing wrong with selling what's up and buying
what's down.
Speaker 3 (42:00):
Multiplication of stocks.
Speaker 2 (42:01):
That was your favorite term, Bob, Bobby, What do you
think your average hold of a stock? Yes, I know,
you probably don't know it. I mean you instinctively might know,
but you don't. I know, you don't think that.
Speaker 7 (42:14):
It's about fifteen twenty years.
Speaker 2 (42:15):
Yeah, so long term to you literally means long term.
Speaker 7 (42:20):
Oh yeah, oh yeah, maybe even for life. I mean,
I'll take Procter and Gamble. John Moler is a very
good man. He's conservative, and Procter and Gamble has got
so many got sixty five products of account for about
ninety ninety five percent of their business. So and the
stock is down, it's kind of hard to find good
(42:43):
companies that are down right now. So I just bought
one guy half a million dollars worth. He had a
million dollars in cash, and I talked to him and
I said, you know, if you that cash makes you
feel good, that's fine. If it was me, I would uh,
I would put I put a lot of fucking gamble
to work. One thing about us, you know, we talk
(43:05):
to our clients before we do something, but a lot
of the business they have power of turning. They can
do what they want to without without consulting you. And
one thing I always do is I give my clients
an hour lesson on how to buy good stocks. I
(43:26):
educate them, but most a lot of the big firms
out there, they're not interested in educating, and that they're
interested in getting the money under management and then just
send you out a statement and reporting. But it doesn't
take too long to teach people the essence of the
stock market, and that is finding great companies with a
long term track record. They have good balance sheets, good finances.
(43:49):
In many cases, a lot of real estate. I mean
Walmart's real estate is staggering. The market bank is Walmart
at about seven hundred and thirty billion dollars I think,
and if you look on their their ten k their
properties are on the books at one hundred and thirty billion,
one hundred and thirty billion now, but that's the costs.
So if you've both live in buying real estate and
(44:13):
big centers for fifty years, so you can imagine if
this is listed at costs, Oh boby, that's meaningless because
real estate's gone up so much, probably about like stocks
over the years.
Speaker 2 (44:26):
Bobby, listen, we could talk forever. We're hard up against
the end of our show, and we thank you so
much for joining us and topping off the show on
stocks and.
Speaker 7 (44:36):
For you listeners, good talking, y'all.
Speaker 1 (44:38):
You bet for your listeners out all.
Speaker 2 (44:41):
Our phone number is eight hundred and four eighty seven,
one seven eighty six. Give us a call and we'll
talk about this. Remember it's your money, it's your future,
don't blow it.
Speaker 5 (44:49):
Advisory services through couple of Investment Advisory Services LLC.
Speaker 6 (44:52):
Security is offered through Capital Investment Grouping Remember FINRA and
SIPIK one thousand e six Forks Road, Raleigh, North Carolina,
nine one nine seventy. MALAS performance is not indicative of
future results.
Hello everybody, this is the Greg Hicks Show.
Speaker 2 (00:02):
I'm glad you tuned in this weekend, or maybe if
you're on a podcast, it might be at three am
in the morning because you can't go to sleep, But
for whatever reason you're tuning in.
Speaker 1 (00:10):
Thank you.
Speaker 2 (00:11):
I'm Greg Hick, certified Financial Planner, along with Wanda Cooper
Financial Advisor and bo Nicholson.
Speaker 1 (00:16):
C FP as well.
Speaker 2 (00:20):
By the way, Certified Financial Planners finally got over one
hundred thousand in the United States just the other day.
I'm like, okay, thank you. I remember when I got mine.
Nobody ever heard of a CFP. But anyway, congrats to
all the CFP candidates. But anyway, if you're a new
listener to our show, we are all about money and
(00:41):
financial planning and investing and all sorts of things. We
have a unique show in the sense that we do
different topics every week, and we cover a broad base
an arena of a financial planning ideas and strategies, and
we cover a lot of things. So if you're a
longtime listener, welcome back. You know what I'm talking talking about.
And if you're a brand new list er, maybe you
(01:02):
just moved into the area from somewhere like a lot
of other people. Or maybe you just got laid off,
or maybe you just inherited money or got a divorce,
who knows, but you're listening to get some advice, and
our show is full of it every week, so we're
glad you tuned in. Today we're going to talk about
something that no one's interested in the stock market. Oh
I'm sorry, I'm sorry. That was a joke. But today
(01:25):
we're going to get into that heavy and deeply and
really bring out some really cool stuff you may have
never thought about or perhaps never heard about. But we
always take the first segment of our show to talk
about current events. So there's a lot of current events
going on. There's a you know, Trump is over in Asia,
in Saudi Arabia and doing his thing, and a lot
(01:49):
of amazing stuff's happening in that area. And in the meantime,
Congress in the Senate are you know, blabbering about each
other's weaknesses, and the House and it particularly is trying
to get there calling the big beautiful bill. They meaning
they're meaning the tax cuts to make them permanent from
(02:10):
Trump's first administration.
Speaker 3 (02:12):
Is so to remind me of rock them sock on robots. Yeah, yeah,
who last hit the first hit?
Speaker 1 (02:18):
Yeah?
Speaker 2 (02:18):
And who's lying and who's not? I think we kind
of know that answer. But anyway, I just wanted to
just do two or three little highlights. This is what
they're they're trying to eliminate over time, some of the
the free gifts to the credits for buying an electric vehicle.
They're trying to eliminate some of the clean energy breaks,
some of the green energy breaks.
Speaker 4 (02:40):
Uh.
Speaker 2 (02:41):
They're trying to keep manufacturing tax breaks to stimulate job growth,
which is cool. There, let me see what are some
other senior deduction Okay, if you're over sixty five, Uh,
they're going to try to give you an additional four
thousand dollars deduction off your income taxes.
Speaker 3 (02:58):
They're also Social Security not taxable.
Speaker 2 (03:00):
Are they not working on that? That was the second
thing I was going to say. One the way to
jump in there.
Speaker 3 (03:05):
I want to hear it.
Speaker 2 (03:06):
And why do when you're serving tables on the weekend
part time, your your tips will be not taxed?
Speaker 1 (03:12):
Aren't you excited?
Speaker 3 (03:13):
Oh? I'm so excited about that.
Speaker 5 (03:14):
Yeah, I know your hairdresser barrel, that's right, and my
hairdresser she's excited my wife's hairdresser because because she gives
too much tip, my wife and.
Speaker 2 (03:26):
I argue about tipping her hairdresser. But anyway, the hairdresser
is excited about the Trump plan. But anyway, those are
things that are happening and you can't do anything about it.
Don't listen to too much media because most of them
are exaggerating and lying. But uh, it's looking like it's
going to pass, and it'll all be good in the
end because everybody will pay less taxes. So let's don't
(03:47):
get outside of the box.
Speaker 1 (03:50):
Here.
Speaker 2 (03:50):
By the way, I always do this every once in
a while. If there's a tax cut, uh here, and
you've heard me say this on the show before, the
top one percent of taxway earners pay forty percent of
the federal taxes, and the top ten percent of wage joarners.
Speaker 1 (04:09):
Pay twenty five twenty four.
Speaker 2 (04:11):
Times more taxes than the bottom fifty percent of working Americans.
Just to give you the truth, if there's a tax cut,
the higher earners are going to get it because the
lower earners don't pay any.
Speaker 4 (04:24):
Well, that's why I'm so amazed at the fight and
the arguments that are going on about doge because they're
finding these issues. But and if you're a taxpayer, you
care about.
Speaker 3 (04:35):
It, you really do. I do.
Speaker 4 (04:38):
And then the media, of course they say stock surge
on thaw in trade.
Speaker 3 (04:45):
Conflict, I mean, and all that.
Speaker 4 (04:48):
They don't give Trump or any of that any credit
for the SMP going up or anything. It's all you
don't hear anything. So it's just it's just funny how
media is and how they can drive what people think.
And I'm like, don't listen to the media to get
your news. You do your own research. You can't believe
everything they say.
Speaker 1 (05:07):
Yeah, good point.
Speaker 6 (05:09):
Well, to be fair, there was one person who lit
the fuse on that sell off and he's been backing
off ever since. And so I think him backing off
and realizing that I want to touch the stove, Oh wait,
the stove is hot, and pulling his finger away that
caused the market whip saw. And so I get both
sides of that argument. And we're not any better off
than we were when we started the year in terms
(05:30):
of trade. And I know there have been some exclusions
for you know, chips and some automakers and other things
like that, but I don't know it. We're kind of
in a wait and see pattern right now with all
this all this tariff stuff.
Speaker 2 (05:43):
But I will say this, boy, when I listened to
the analyst on Wall Street dooming and glooming of recessions.
Speaker 1 (05:49):
Coming all, they're all bragging about we never.
Speaker 2 (05:52):
Are emotional, we plan way ahead. Oh yeah, they sounded
just like a person on the street.
Speaker 6 (05:57):
That's outrageous.
Speaker 1 (05:58):
That that really made me angry.
Speaker 6 (06:00):
I've lost some respect for a lot of the talking
heads that I really look up to, or have looked
up for for a long time, because their political bias
really got exposed in the past month and a half
with them calling like you said, you know, we're going
to go into a nasty recession, And I think the
chance of a nasty recession is probably off the table
(06:20):
at this point. I think we could I think we
could go.
Speaker 3 (06:23):
I think we have been helped.
Speaker 6 (06:25):
But in terms of the numbers on tariffs, we're not
better off than we were just factually, we're not better
off than we were in January.
Speaker 1 (06:32):
But this is an.
Speaker 6 (06:32):
Interesting stat This should give people some optimism. And this
is I got to attribute hal Letens for this because
he's kind of our market historian. But there have been
forty one years with double digit drawdowns at some point
since nineteen fifty, the S and P five hundred finished
with a game twenty five times, or sixty one percent
of those times. Of those twenty five years with double
(06:53):
digit drawdowns that finished in the black, which means positive
sixteen times, the market ended the year with double digit gains.
So to break that down in years with a correction
of ten percent or worse in the stock market, the
market's been more likely to finish the year with gains
than losses, and more likely to finish the year with
double digit gains than double digit losses. So it's kind
(07:16):
of a classic puke and rally situation, right. So like
we've had our the slingshots been pulled back at this point,
and now it's been released. What do you do well?
I mean, don't do it blindly. You should call an
advisor and sit down and make sure what you're doing
makes sense for your plan. But there's some optimism to
be had based on what history says, so call us
nine one nine eight five six one six eight.
Speaker 1 (07:37):
You know.
Speaker 2 (07:37):
The the other thing I thought There was two articles
in Wall Street during the last couple of weeks talking
about the investor on the public square bought or did
no trading in the great crash we just had. But
the Wall Street experts sold. Real guy wins again the
retail the normal person on the street it right after all,
(08:01):
and the big guys that are so smart blew it.
And you wonder if they bought back yet too, You know,
that makes me wonder. But anyway, again, sometimes just just
hold onto your horses and don't panic.
Speaker 6 (08:13):
There was a real cocky article that somebody referenced during
that time and it was like the days of Main
Street beating Wall Street are over? Yeah, And that sentiment
lasted like three or four days.
Speaker 3 (08:24):
Yeah.
Speaker 6 (08:24):
I was like, okay, retail guys, got you cooked?
Speaker 1 (08:27):
Yeah, exactly.
Speaker 2 (08:28):
Yeah, so a lot of times, and I think we
all noticed that we all got a few calls during
that time, and the majority of my calls were what
are we buying?
Speaker 1 (08:37):
They instinctively needed to buy low.
Speaker 6 (08:40):
We'll get into that.
Speaker 1 (08:41):
We did.
Speaker 2 (08:43):
So we're by the way, our show today is on stocks,
So if you're interested in the stock.
Speaker 1 (08:47):
Market, hang on.
Speaker 2 (08:48):
We're coming back where else And all right, everyone, welcome
back to the Greg Kicks Show. We're kind of having
fun today because we're talking about stocks. Our topic of
the day is stocks and stock markets and how do
you do it?
Speaker 1 (08:59):
What do you do?
Speaker 2 (08:59):
What does all this stuff mean? And couldn't be better
timing with the market going crazy down almost to the
correct way below correction, almost to the bear market, and
then back up again. So it's basically almost positive for
the year.
Speaker 6 (09:13):
Anyways, happened this year? Let's shut your eyes on January first?
What happened?
Speaker 1 (09:18):
Yeah, that's true.
Speaker 2 (09:19):
If you had a three month vacation, your god, did
anything happen?
Speaker 1 (09:23):
But anyway, I thought it was fun.
Speaker 2 (09:26):
Again, Well, I've got several things, and then at the
end of the show, we're going to have a special
guest at some of your radio listeners know, well, who's
a guru in the stock market. But I thought this
was like fun stuff, y'all. The stock market history is
full of interesting things. But anyway, if you had bought
applestock in nineteen eighty five, you're up one hundred and
(09:48):
sixty five thousand percent.
Speaker 3 (09:49):
God, why Bobby probably did.
Speaker 2 (09:54):
Winda had a class ask what he was going to
do in the future, So just tell him you would
have apple in eighty two.
Speaker 3 (10:01):
And interesting enough, he's got Apple in his a case.
Speaker 2 (10:04):
Oh god, well, counting all the splits, the stock was
worth twelve cents a share in nineteen eighty five, and
that one two hundred and ten.
Speaker 1 (10:12):
But what about Costco?
Speaker 2 (10:13):
What if you had have bought Sears, Kmart and Costco
back in nineteen eighty six. Sears and Kmart are gone,
and Costco's split share price that year was nine dollars
and it reached one thousand dollars a share recently, So
you're up over nine thousand percent. And that's the point
of the stock market. You can go bad bad overtime,
(10:35):
and you can go up up over time. And if
we did know the future, we don't have, you know,
I used to I usually tell clients if God had
an eight hundred number, I can make you very wealthy.
Speaker 1 (10:45):
But we don't know the future.
Speaker 2 (10:47):
So the market is fun, exciting, and it is historically
it's the number one best return of any investment category
you can do, is the stock market. So that's why
we're taking our show today and talking about it because
there's so many interesting things about.
Speaker 6 (11:02):
It, but it moves so quickly and it scares a
lot of people away for that reason. And like we
talked about in our first segment, the all caps headlines
that are so prevalent when the market does things like
it did at the start of this year. You know,
the guy who called the two thousand and eight crash
is saying it's gonna happen again. This time's going to
be twice as bad. And you're like, oh, gosh, I
know I shouldn't believe that I should put my head
(11:23):
in the sand, but it's hard when I check my
account balance and my balance is down. And the stat
that we've brought up on the show before is the
market hits all time highs seven percent of trading days.
That's that is the statistic, and that's a hard word
to say, statistic. So I remind people you might check
your account at an all time high, but there is
(11:43):
a ninety three percent chance that when you go back
and check it again that you're not going to be
at that all time high. And that can cause your
emotions to go a little crazy. And for the past
two years, the market's been going up, up, up, up, up,
up up up, and then finally this year we had
some violatility, and I think what that did is it
caused some people who maybe got a little cocky with
(12:04):
their Robinhood accounts and they're you know, personally managed accounts,
and they were just throwing stuff at the wall and
buying whatever, and it was going up and they felt good.
It's easy to make money in the stock market. And
then the stock market does what the stock market always does,
and it reverts and it comes back down, and that's
when the emotion changes from I'm a genius to oh gosh,
(12:25):
I'm an idiot. I'm gonna lose everything. I gotta sell.
I got to get out before this gets worse. That
is the time where advisors really show their benefit and
their true callers. Yeah, because we were making a lot
of outward calls to clients during that nineteen percent drop
to say, hey, you got some cash in your account,
(12:47):
let's throw this cash in because things are on sale
right now twenty twenty five percent off their highs. We
think this is a good time to enter. We had
a couple clients, really not many at all, call us
who were worried about, Hey, what do you think is
going to happen? Are we going to be all right?
And the answer you always feel like, well, this time
is different. You know this time is going to be different.
(13:08):
I just feel it, and it's like, no, what you're
feeling or is you're feeling emotions, And what I'm feeling
is the urge to really do my job and show
my worth right now and give you the objective, the
objective answer, and say, look, we got to stay the course,
we got to plan for this. Let's take some cash
and lesten to this.
Speaker 4 (13:23):
You know, I ask, I have not used this AI feature,
but I wanted to take a little stab at it,
and I said, what does a financial advisor role?
Speaker 3 (13:33):
What does that do?
Speaker 4 (13:34):
And it actually came up to things that I actually do,
which was I was amazed, Like, you develop investment plans,
you choose investments, you monitor them, you adjust the portfolios.
Speaker 3 (13:46):
So that's what we do with stocks.
Speaker 4 (13:48):
And interestingly enough, I had a meeting recently with a
lady that was referred to me by an existing client,
and she said, I've never done the stock market. My
husband is ready to jump in and he wants to
buy this stock that you know I won't mention on
the air, but it's a brand new one.
Speaker 3 (14:06):
And and I said.
Speaker 4 (14:07):
Well, you know, I mean, you know, sometimes getting in
on the ground floor could be good, sometimes it may not.
And I said well, what tell me stores and companies
that you are comfortable with, Like, like, if you if
you could own a company, what would it look like.
She said, well, I like Costco. She said, I'm not
(14:29):
afraid of that. And I said, well, that's interesting. We've
bought Costco before. And then she said, I'm not afraid
of Protter and Gamble and I said, we bought that before.
Speaker 3 (14:40):
So said, there are.
Speaker 4 (14:41):
Companies that that people can be comfortable with. And if
you mentioned it in that respect of what companies would
you like to own, if you could own any companies
in the world, what would it be?
Speaker 3 (14:51):
And then you go, well, that's the stock.
Speaker 4 (14:53):
And by the way, they pay a dividend, and if
you reinvest that dividend, you're buying more of those shares,
So you're buying ownership into these companies that you love.
Speaker 1 (15:01):
That's true.
Speaker 4 (15:02):
When you describe it that way, people are a little
less afraid.
Speaker 6 (15:05):
Peter Lynch had a rule. He's a legendary investor. Buy
what you know. And so you know, you buy Dominoes,
you buy Apple, you have an iPhone, you buy Disney
because you took your kids to Disney. It's not the
only thing you buy. But it's a great starting point
if you're getting into it.
Speaker 2 (15:21):
By the way, Peter Lynch was the manager of Fideli Magellan,
which was like Warren Buffett today, like it was number
one mutual fund forever in the eighties. Anyway, one of
his greatest buys was Haynes Brand. He said, you know
how you know the research I did on it. We
were at a barbecue and all the women were talking
about buying pantyhose and eggs.
Speaker 1 (15:42):
Yes, he went, he went, I got to look that up.
Speaker 2 (15:45):
And he hit a home run because he listened to
the women, like what are the people on the street
interested in? By the way, y'all, hear's some fun stuff
this data. When did the stock exchange actually start? The
New York Stock.
Speaker 6 (15:57):
Exchange eighteen seventy two.
Speaker 2 (16:00):
Okay, I was thinking in the eighteen hundreds. It started
in seventeen ninety the American Stock Exchange and the government
issued bonds to sell so bonds that's not the stock
exchange but bond exchange. But only two years yeah, yeah,
that's right. It's been bad, but only two years later,
(16:20):
seventeen ninety two. I'll read this little thing. It says
some people got together and the merchants up in New
York City and they started talking about opening something where
they could trade each other's securities in ownership. And that's
how it started in seventeen ninety two. And the point
(16:41):
of me saying that is there's a bowload of history
in the stock market. And you'll hear bow and wind
and I talk about in the past. This we're talking
about history.
Speaker 1 (16:52):
Just like in anything in life. Let history be your guide.
Speaker 2 (16:55):
And history does repeat itself sometimes, but history also teaches
you so much wisdom.
Speaker 1 (17:01):
What to do and what not to do.
Speaker 2 (17:03):
And luckily in the stock exchange world, there's a boatload
of history. And like bow Red hal eddins idea is
like go back and say, Okay, something's happening, what is
the historical data on it?
Speaker 4 (17:16):
Well, you know I get this comment too, and I
know you guys have gotten it to I've never owned stocks, yeah,
I said, do you have a four to one k? Well, yes,
that's mutual funds. Though I'm like, okay, well, let me
give you a little lesson mutual funds are a basket
of stocks. Yes, you own stocks if you've done any
(17:38):
type of four to one K investing or you know,
simple iras or whatever, and you've done it with mutual
fund companies, you've owned stocks. So if you're out there
listening today and you or have been in the stock world,
maybe you haven't give us a call nine one nine
eight five six nineteen sixty eight. We're happy for you
to pick our brain as a complimentary appointment.
Speaker 6 (18:00):
And mutual funds are an easy way if you have
a little bit of money to get started with an
active management approach. And basically what that means is you're
giving your money to this fund, but the fund is
effectively an institution, and there's a specific investment target or
investment goal for each one of those funds. Maybe you're
investing in a US growth fund. Well, the way that
(18:21):
it works is there's managers that set up in New
York or wherever they are, who control what's in this fund.
They buy stocks, they sell stocks, they buy whatever else,
and they sell whatever else. Well that's all well and good,
but we've mentioned this on the show before. If you're
doing that in a taxable account, all those moves that
they're making buying this, selling that, buying this, there's tax
ramifications associated to that, gains and losses and all that stuff.
(18:45):
They're passed through to the end investor. And so if
you own mutual funds in a taxable account, there are
better ways to do it. They're what's called exchange traded funds.
If you like having that diversification, you like taking money
and investing it in US growth companies, you can invest
in a US growth Jane's traded funds and energy. Yeah,
you can. You can get as you can get as
granular as you want to in your investing style. But
(19:07):
understand remember it's what you keep, not what you make.
And with mutual funds, oftentimes you're making less because you're
having to pay a tax consequence. So just keep that
in mind. But that goes to the manager's story and
how how managers work. Money managers. So Wanda, Greg and
I we're all licensed to manage money, and we do
(19:28):
that for certain clients, but oftentimes what we do is
we hire in a money manager that we've worked with
for a long time, that we trust, that we've vetted
for ability and integrity, all that kind of stuff, and
as part of the fee that you pay to us,
we pay to them. And so we're going to talk
about that a little bit more after this break. Y'all
stick with us, and we'll talk about all the different
investing styles that you can have if you come to
(19:50):
work with Financial Resource Management.
Speaker 1 (19:51):
Be right back, Welcome back to the grad Kicks Show.
Speaker 2 (19:54):
We're in the second half of the show now on
stocks and stock investing, stock markets, how do they work,
what's the history. It's the best investment return in recorded history.
So you need to be in it. But how do
you get in it? And what do you do? And
who do you trust and all those things. I want
to remind you that we have a website FRMNC dot
com that fr M and C simply stands for our
(20:16):
small business Financial Resource Management, headquartered in Rileigh, North Carolina,
one of the great growth cities in the in the world,
I guess. And then also we have an office in
the Moreheads City area right on the Crystal Coast Atlantic
Beach Causeway, which has a beautiful view of the harbor.
So we're we're we're we're doing a lot of stuff.
(20:37):
We cover a lot of territory with all of our
shows and financial planning and investments and taxes and whatever,
and so the best way to contact us is through
the telephone number eight hundred and four eighty seven, one
seven eighty six, but also meet us in our offices,
but if you can, we will meet by zoom. But
we love office meetings. It's nothing like a personal touch.
(20:59):
If you're going to have an advisor, you need someone
you really inherently trust, or else it's not going to work.
So meeting you in person is our choice if we can.
But a radio phone call is the way to get
a hold of us nine one, nine eight five six
nineteen sixty eight. The website FRM stands for a Financial
Resource Management in c is, North Carolina, So go there
(21:21):
to check us out frmnth dot com. Okay, this segment,
we're going to talk a little more about stocks and
how to view it, and I'll just open up with
a few ideas. Over the history of stocks is an
extensive history. There's been different kind of styles developed, what
to look for, how to diversify assets to reduce risk.
(21:43):
There's large company stocks, there's small company stocks. There's USA,
we have the biggest stock market in the world. But
then there's there's markets all over the world. There's international
stocks you can buy. You can diversify between all of
the above. There's something called gross style and value style.
That's a simple one to kind of understand. Growth would
(22:05):
be what's hot. Like AI companies are high growth, they're
all about growth. Value stocks are like Wanda mentioned earlier
in the show, like Procter and Gamble, Like for example,
Pepsi is at a five year low right now, they've
increased their dividend for sixty three years. We're not recommended
that to you, but you might want to check out
pep not as a drink, but as a stock. For example,
(22:27):
that's called a value stock. It has great value and
potential growth, but it also spins off dividends.
Speaker 1 (22:33):
So there's so.
Speaker 2 (22:33):
Many little things like that that are involved in his advisors.
That's what we need to be cognizant, cognizant of to
help people.
Speaker 4 (22:41):
Well, yeah, you know Bobby's is going to join us
in the last segment and Bobby Rice. Yeah, Bobby Edgerton, Yeah,
I think everybody knows him and we've had him on
the show several years. But you know, he does the
most interesting thing. I don't think he does a lot
of computer generated you know, recommends. I think Bobby literally
(23:02):
reads every analyst report and value line and things like that.
So I kind of learned from him how to use
street wise when choosing a stock. You know, it's not
just about the plugging it in and see where it
lines up on that chart. It's about understanding what you're buying. Like,
for instance, I'm a I'm a Ross shopper, and years ago,
(23:24):
I thought I want to buy some raw stock, and instinctively,
though you know, I was feeling the push of other
people that were saying retail is not a good thing
to get into. Retail is not a good thing to
get into. Well, look where Ross is now. Instinctively I
was right, and and and dollar general, same thing. I've
been waiting five years to buy that stock, been watching,
(23:45):
watching and watching, and it took a little dip recently
and I jumped in with both feet and thought, yeah,
I'm so glad because it's needed for sure. But but
a lot of this instinct to style for long terms
that have done this a long time is not plugging
things into computers. It's looking at balance sheets. That's the
(24:07):
first thing you look at when you and I talk
about a stock.
Speaker 1 (24:10):
Let's look at the balance sheet.
Speaker 4 (24:13):
I look at beta, And because when I was in banking,
they taught us beta, meaning that amount of risks that
you're taking compared to the market. And so when I'm
looking at a client that's a moderate risk, I'm instinctively
looking for a stock that the beta is less than
one one or less. So you know, all those things
that I learned over time is so much more valuable
(24:35):
to me than being able to use the software. I'm
not dissing software because obviously I looked at AI recently
and said, what is it that I do as my job,
and it was was right on target. But I still
like to use those instinctive things that I have. And again,
we all three come from different ends of the spectrum
as far as investing. We all bring something to the table.
(24:58):
So if you're interested in meeting with us, give us
a call at nine one nine A five six nineteen
sixty eight to schedule your complimentary meeting.
Speaker 6 (25:06):
Yeah, and Bobby, as you'll hear in the next segment,
is just a wealth and knowledge because he reads Baron's
cover to cover every single week when it comes out
the Wall Street Journal. He studies value line, which is
like the company's fundamentals and all their numbers. But another
thing that I respect that he does is really get
to know the CEOs, and he watches all the interviews
on MSNBC and elsewhere with the people who are leading
(25:28):
these companies, And how do I feel about this guy?
What's his past history? Do I trust what he's saying
to me? Interview well? Does he interview well? Or is
he just spinning the numbers to make it look good
for investors. Bobby's got a pretty good BS meter when
it comes to that. And another thing I like about
Bobby and some of the other managers that we use
is this is all they do. So like all Bobby
does is read and invest in stocks, try to pick
(25:50):
stocks to invest in. We're all fully licensed to do this.
But before the break, we were talking about the different
styles that you can take with managers. Let's just say
you pay a fee of one point twenty five percent
to your current money manager and they're at a big wirehouse,
you know, They're at a Morgan Stanley, Merrill, Edward Jones, whoever.
Oftentimes that client will come into the office and they'll say, yeah,
(26:12):
I've got an advisor. You know, I'm just coming here
for a second opinion. Okay, what do you think your
fee is? And they'll bring a statement in. I'll be
looking through it, and I can see that their listed
fee is one point twenty five. Well, my fee is
one point twenty five, it says it right there. All right, Well,
let's just take a look at who's managing the money
behind the scenes. You've got Blackrock, you've got Clearbridge, you've
got London Company, you have all these managers who are
(26:34):
managing different sleeves of your account. Well, what you don't
know is those managers are maybe charging you zero point
three to zero point five. And so I'll tell that client,
after analysis, your fee is actually one point seventy five.
Your total fee that you're paying is one point seventy five.
And then I'll show them the first page of our agreement,
(26:56):
our new account agreement, and what it shows is it
shows here's your fee, and here's how it's split up.
Your fee with us is whatever, and of that fee
that you pay, here's who gets this part, and here's
who gets this part. There's no back door behind the
scenes fee as there are oftentimes at a lot of
these big wirehouses. And so I just think it's important
(27:17):
for our listeners to understand that and really know what
you're paying for the value that you think you're getting
and so if you want an analysis done on your
statements to see you know what your fee is, give
us a call A nine one nine eight five six
one nine six eight.
Speaker 2 (27:31):
Another thing that I want to point out too is
the risk aversion. A lot of people are afraid of stocks,
and everybody has a risk. We actually do, and Bo
mentioned paperwork. In the paperwork, there's a risk profile. We
ask you a few questions and tally up a number
and it tells us pretty close what kind of risk
you have before you ever start investing in stock. So
(27:54):
if you're a low risk, metior, moderate, or high, we
can do it whatever way you want.
Speaker 3 (27:59):
You make money vest you that way too, Yeah, and we're.
Speaker 1 (28:01):
Going to stick to it.
Speaker 2 (28:02):
And you may have an IRA you want to be aggressive,
and you may have a traditional broke's account you want
to be moderate. You can also do that. Maybe you
have a husband and wife with different risks. You can
have different accounts. So we do all that. I just
wanted to mention two or three bullet points real quick
on risk. One major way to divert risk, avert risk
(28:23):
and difuse it is to diversify critical. Critical point diversification
is as old as King Solomon when he wrote three
thousand years ago, to spread your bread among many waters,
where you do not know what is to come. How's
that for three thousand year old advice? Bilows sell high.
That's still the only way to make money, and people
forget that. They want to like they want to buy
(28:45):
Costco today, wanted to mission Costco's near an all time high. Well,
wait until you have a bad market and you might
be able to dip into it. Keep some cash around always.
We always have spare cash for something that might come
along and go, oh my god, gosh, I want to
buy some but I don't have any money. We always
keep a percent in cash, maybe ten percent or whatever
(29:06):
the number might be. And then we've all said this,
but have an advisor because there's nothing like having a
different set of eyes on your account that's so critical.
Speaker 1 (29:16):
And I will say this.
Speaker 2 (29:17):
I ran into a person recently that met with their
advisor and they asked a question, do you think we
can retire soon? And he said pretty close? And they said, well, well,
how did we do this year? And he said pretty good?
Speaker 1 (29:32):
I'm serious. I went, I know, I went, you got.
Speaker 2 (29:36):
To be kidding me, And they said, that's why we're
coming to you, but that's not advice.
Speaker 1 (29:43):
You need data. You need data to think logically.
Speaker 2 (29:47):
Good night, And you know.
Speaker 4 (29:48):
My aversion to risk to charts and graphs. I think
you know that after all these years. But there is
software we use for that very reason, and numbers do not.
So I can actually show you year to year what
your performance has been in each account, and I can
show you collectively what you've done. Yeah, So I don't
(30:12):
like to spend a whole lot of time on the
chart one that shows the chart, but I do like
to show clients in writing what they've done in each
account year over year, and that's helpful.
Speaker 3 (30:22):
That's history, but it's your history.
Speaker 2 (30:25):
We advisors have to be accountable just as much as
anybody else, So to give vague returns and comments like that,
it's not right.
Speaker 6 (30:35):
Well, I'll play Devil's advocate here because I can't tell
you how many meetings I have, well over half of
them where a client comes in and we sit down
and we just chat about what's been going on in
their life and what they're doing, and you know, maybe
their income playing a little bit. And I've got the
folder with their review in it. But that folder doesn't
get opened. Oftentimes we don't look at their numbers because
(30:58):
they don't care and they don't ask what they really
want to know, and they trust us. I mean, our
clients trust Greg, Wanda and Bow at this point. They
want to know when they come in and we have
that catch up conversation, Am I still good? Am I
still going to be okay? And I always let them
know and open up the door to say, look, if
you want to get in to the nitty gritty and
granular details and run a financial plan, we can certainly
(31:20):
do that. But I've found and I came from Mary
Lynch and we used to do these financial plans, these robust,
you know, one hundred page plans for everybody, but you
to just get lost.
Speaker 3 (31:30):
And they do free lean over. Yep.
Speaker 6 (31:33):
It is not beneficial in my opinion. And oftentimes people
get too attached to those Oh I have a ninety
nine percent chance of success and retirement, and then they
get too cocky with their money and that ninety nine
percent drops to it.
Speaker 3 (31:44):
Maybe maybe they.
Speaker 4 (31:45):
Want to pull out twenty thousand to go on that
Caribbean cruise.
Speaker 6 (31:48):
That's right, And so what I've found, if this is
not me being cocky is that I can do oftentimes
just as good of a simplistic financial plan that gives
people confidence on a legal pad or a sharpie, just
showing them the numbers and how it's all going to work.
And so regardless of your style and what you want,
we can help you out. Give us a call nine
one nine eight five six one nine six eight. Y'all,
(32:08):
we's got Bobby Edgerton joining us for the final segment
of this show. Please stick with us, we'll be right.
Speaker 2 (32:12):
Back, all right, So, welcome back to the Great Hicks Show.
We have our very special guests that we've had on
our show for many years, Bobby Edgerton, money manager for
Capital Investment Group or counsel, and he is he's been
in the market a few decades and very smart intuitively
and a great communicator. So Bobby, we've done a lot
(32:33):
of detail on stocks and markets and history and growth
and value and all that. And you're you're the ending
note of the show, and we're glad you're here. Welcome back,
and we're just curious, like what you're looking at today
in this kind of market. We've had this gigantic crash
and recovery, so we're all ears today, Bobby, So take
it away.
Speaker 7 (32:55):
Okay, Well here you and I've always liked buying stocks
that had a lot of cash and not much of
any debt and hard to get in trouble when you
don't have debt. It's easy to get in trouble when
you got debt. So I have a lot of and
when I'm dealing with other people's money, my number one
goal was not to lose them much money. I normally
(33:18):
make them money if they're patient. And because all these companies,
the cash flow they have every year, it just it's
like Coca Cola, for example. If your cash flow and
fifteen billion dollars a year in five years, that's seventy
five billion that's added to the value of the company.
You got to believe that the stock is going to
(33:39):
go up with that. But right now, but you know,
we got the tariff situation. I hope the government can
deal with that, and I wish them all the best.
And but I'd say, right now, Procter and Gambles sure
makes sense to me. It's now from eighty to about
fiftyifty nine or sixty. John Mueller is one of the
(34:02):
smartest guys around. He's been there over twenty years. He
was the chief financial officer for a long time and
now he's the chief executive officer. But a nice man,
a very conservative man. And they had twenty four billion
in cash flow last year. They do have thirty six
(34:23):
billion in debt, but when you got twenty four billion
in cash flow a year, that's pretty good. Killing this
gigantic warehouse factory down in Louisiana that's two and a
half million square feet, they're taking down some of the
old factories that built tide and Pampers and stuff like that.
(34:46):
I like everything they doing. I like the stock prices
down when a lot of stock prices are up. And
if you can't they got twenty five products that generate
over a billion dollars in cash a year all of
ola to let that kind of stuff. Wow, So that's
a pretty good You know, you want to keep your
(35:06):
clients happy and comfortable, and if you can't be comfortable
with a propery and gamble, you probably don't belong in
the market, right.
Speaker 3 (35:14):
Exactly, sentiments exactly, that's cool.
Speaker 1 (35:18):
Uh, Bobby.
Speaker 2 (35:19):
The last time you were on you mentioned Mercedes and
we bought it, and we bought it and it went
down even further, and they just paid out an eight
and a half percent dividend they pay annually. So my
clients that we bought Mercedes, that dividend made him feel
pretty good.
Speaker 7 (35:36):
Well, you know, it's funny. I have a lot of
clients have been with me twenty twenty five years, and
for example, my cost On I bought Costco for eighties
one thousand. Now, stuff like that kind of takes. These
big companies take care of you over the years if
you'll leave them alone. And but I think the building
(36:00):
of the digital economy which we're in is software and semiconductors,
and that's my favorite bunch. I watched the Cadence Design
System on Kramer day before yesterday and the stock was down.
It's got me excited. Now it is back up at
the high. But these tech companies tend to have a
lot of cash and not much debt, and they're vital.
(36:21):
So I'm talking about the Amazons and the Microsoft's and
the Googles of this world, which is alphabet and you know,
Apple sits on one hundred and thirty three billion dollars
in cash. But I think the biggest misconception that so
much of the public has is that stock market is
kind of a gamble. Well, if you think owning Walmart's
(36:43):
a gamble, you need to learn a few things. So
it's a gamble if you're going to sell if it
goes down. But we don't do that. We buy it
when it's down. If it goes down anything, we buy more.
A lot of the these big companies, they have their
(37:03):
artificial intelligence stuff and their stuff hooked up for computers,
and what they do is a lot of times if
your stocks are down six or seven percent, they have
a program to sell. Well that's pretty stupid in my opinion.
You don't sell good stock when they're down. If you're
ever gonna sell, you sell when they're up.
Speaker 3 (37:21):
Can I ask you a question right here? You mentioned Google.
Speaker 4 (37:24):
How do you feel that the AI world could impact
Google stock?
Speaker 6 (37:30):
I'm just at Apple replacing it.
Speaker 7 (37:33):
Yeah, Well you're looking at basic search against AI search,
and I don't think anybody's gonna totally replace them. They
got a lot of other business of going. They got
about ninety five billion in cash and that's maybe thirty
five billion. But everything is competitive, just like sports nowadays.
(37:54):
And I think Google Alphabet is the least liked of
what I call the Big six, but it's uh. I've
had it for a long time. As long as they
got that Fort Knox balance sheet, I'm okay with it.
My biggest position, by far is Apple, and I trust Apple,
(38:16):
and the last thing people are gonna get rid of
are their funds.
Speaker 1 (38:20):
Yes, yeah, at that point, I think.
Speaker 7 (38:22):
And Tim Cook's done a fabulous job since he's been in,
and Apple's had a somewhat of a little bit of
correction in here lately. I think it's down from like
two sixty to to ten. But that's my biggest position.
And I think if you're gonna give you money to
somebody to manage, just ask them to show you their
(38:44):
statement too.
Speaker 1 (38:46):
Yeah.
Speaker 7 (38:47):
If they tell you, if they tell you that you
ought to be in this, I say, do you own
it and show it to me? You know, well I
do that.
Speaker 6 (38:58):
Yeah, that's a good way to do it.
Speaker 1 (39:00):
Well.
Speaker 6 (39:00):
Back on Apple, Bobby Warren Buffett two weeks ago called
out Tim Cook and he said, you're the only earnings call.
I listened to it because I'm not interested in the
way that CEOs will spin the story. I want to
know the numbers, and so in a way that really
reminded me of you. But I know that you put
a lot of faith in CEOs of companies, and you
like to get to know who's leading certain certain companies
(39:23):
in what direction, and you watch all their interviews on
MSNBC and CNBC and everywhere else. Can you talk a
little bit about how important it is to understand kind
of who's at the helm of these big companies.
Speaker 7 (39:37):
Is vital?
Speaker 3 (39:38):
Yes?
Speaker 7 (39:38):
And you know you can. You can google say Walmart
CEO interview and listen to the Walmart Uh, the Walmart
chief financial officer just got off and uh, Doug McMillan is, Oh, sorry.
Doug McMillan is a smart guy and a nice guy.
And I like nice guys, nice women running companies. I
(40:02):
don't like people that I suspect might try to sell
the company or leverage it up. That's pretty important, just
like just like a basketball coach.
Speaker 1 (40:13):
Yeah.
Speaker 6 (40:13):
No, I love your analogies to sports. It helps break
it down for people who might not be understanding of
this stuff. And back on a quote you mentioned earlier
stocks typically work out for you if you leave them alone.
I think about the other quote that sometimes the best
strategy is doing nothing. You know, and this was realized
about two months ago with all this teariff stuff. When
(40:33):
the market dropped nineteen twenty percent, some people freaked out.
Some people may have gone to cash. You know, there's
unfortunately some investors out there that let their emotions get
the best of them. But I remind my clients I
know Gregor want to do too. Y'all are long term investors.
You're not traders. And there's a stark difference between a
long term investor and a trader. And I think that
(40:54):
you also, Bobby like working with the long term investors
and probably classify yourself as one. Even though you're the
one out there buying and selling these stocks, you're not
doing it on a repeatable basis, or you're not You're
what am I trying to say? Your activity is not
very high. You're buying a stock and you're committing to
that idea and that concept for a long period of time.
(41:16):
Can you talk a little bit about that.
Speaker 7 (41:17):
Yeah, Well, Obama up raised a capital gains tax from
fifteen to twenty percent and then put a three eight
Obama tax, which is the Affordable Care Act, and then
you got fied for the state. So when you got
big profits and you're going to pay twenty nine percent.
It's not easy to get that back, right. So the
two ways you make money in the stock market you
(41:39):
buy great companies with great balance sheets, a lot of cash,
not a whole lot of debt, and you hold them
for life. And then the other one is if you
buy a good stock when it's down and it goes
way up, and there's two or three just as good
as companies down, especially in an IRA or a non
taxtble account. Nothing wrong with selling what's up and buying
what's down.
Speaker 3 (42:00):
Multiplication of stocks.
Speaker 2 (42:01):
That was your favorite term, Bob, Bobby, What do you
think your average hold of a stock? Yes, I know,
you probably don't know it. I mean you instinctively might know,
but you don't. I know, you don't think that.
Speaker 7 (42:14):
It's about fifteen twenty years.
Speaker 2 (42:15):
Yeah, so long term to you literally means long term.
Speaker 7 (42:20):
Oh yeah, oh yeah, maybe even for life. I mean,
I'll take Procter and Gamble. John Moler is a very
good man. He's conservative, and Procter and Gamble has got
so many got sixty five products of account for about
ninety ninety five percent of their business. So and the
stock is down, it's kind of hard to find good
(42:43):
companies that are down right now. So I just bought
one guy half a million dollars worth. He had a
million dollars in cash, and I talked to him and
I said, you know, if you that cash makes you
feel good, that's fine. If it was me, I would uh,
I would put I put a lot of fucking gamble
to work. One thing about us, you know, we talk
(43:05):
to our clients before we do something, but a lot
of the business they have power of turning. They can
do what they want to without without consulting you. And
one thing I always do is I give my clients
an hour lesson on how to buy good stocks. I
(43:26):
educate them, but most a lot of the big firms
out there, they're not interested in educating, and that they're
interested in getting the money under management and then just
send you out a statement and reporting. But it doesn't
take too long to teach people the essence of the
stock market, and that is finding great companies with a
long term track record. They have good balance sheets, good finances.
(43:49):
In many cases, a lot of real estate. I mean
Walmart's real estate is staggering. The market bank is Walmart
at about seven hundred and thirty billion dollars I think,
and if you look on their their ten k their
properties are on the books at one hundred and thirty billion,
one hundred and thirty billion now, but that's the costs.
So if you've both live in buying real estate and
(44:13):
big centers for fifty years, so you can imagine if
this is listed at costs, Oh boby, that's meaningless because
real estate's gone up so much, probably about like stocks
over the years.
Speaker 2 (44:26):
Bobby, listen, we could talk forever. We're hard up against
the end of our show, and we thank you so
much for joining us and topping off the show on
stocks and.
Speaker 7 (44:36):
For you listeners, good talking, y'all.
Speaker 1 (44:38):
You bet for your listeners out all.
Speaker 2 (44:41):
Our phone number is eight hundred and four eighty seven,
one seven eighty six. Give us a call and we'll
talk about this. Remember it's your money, it's your future,
don't blow it.
Speaker 5 (44:49):
Advisory services through couple of Investment Advisory Services LLC.
Speaker 6 (44:52):
Security is offered through Capital Investment Grouping Remember FINRA and
SIPIK one thousand e six Forks Road, Raleigh, North Carolina,
nine one nine seventy. MALAS performance is not indicative of
future results.
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