Episode Transcript
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Speaker 1 (00:00):
The Wise Money Guys Radio show is brought to you
by One Source of Wealth Management SEC Licensed three one
nine zero seven eight. For disclosures and more information, visit
our website one Source WM dot com.
Speaker 2 (00:13):
Welcome to the Wisemoney Guys Radio Show on your co
host John Scambra, and I'm sitting here with my partner
extraordinaire just happy. Thatscon to you and we are the
Wise Money Guys. But we work and they're sponsored by
one Soource Wealth Management, which is SEC number three one
nine zero seven eight. For more information on us or
(00:37):
to find more information on our company, go to our
website at Wysemoneyguys dot com. That's Wysmoneyguys dot com. Or
you can click on the link in the YouTube video
to get you to our website. You can also go
to that link from our website to register for our
(01:01):
upcoming workshop for retirees and people about to retire, which week, Yeah, yeah,
actually it's line for that one week. My business we
started that about are talking about about a couple of
months ago and here we are. So that is on
March twelfth, from six to seven thirty pm at the
(01:25):
Old Spaghetti Factory in Conquered so again you can go
to our website wisemoneyguys dot com and register for that
workshop through the website, or you can call nine one
six nine six seven thirty five hundred, which is our
main office line. However, we do have an office facility
(01:47):
in Walnut Creek as well as in San Mateo. And
again our main phone number is nine one six nine
six seven thirty five hundred. So I got to start
off by saying, first of all, we'll course in this show,
talk about the markets, talk about strategy, talk about Okay,
(02:08):
what's going to happen now? So you want to stay
tuned always to the very end because and throughout, because
that's when we're saying this is what we think you
should do. This is what we are doing or think
you should do or about to do. And quite frankly,
I got to start off by saying, the markets do
(02:29):
do we were what the market is to no, we
were right. I mean our last show, in the show
before that, we talked about the S and P average evaluations.
We talked about that the high.
Speaker 3 (02:42):
Wall for further back, actually the end of last year,
we were anticipating the beginning part of this year. The
first quarter is going to be a bumpy ride when
all these new policies and tariff talk and kind of
all of that stuff gets sifted through and figured out,
is going to be a bumpy ride. And that's exactly
what it's been.
Speaker 2 (02:58):
And we also said that would be in our estimation,
more tailwinds which is good news, than headwinds, which is
bad news. However, we cautioned that tail that headwinds, like
you said in the first quarter, might be more than
the tailwinds as we absorb you know, the new administration,
(03:20):
the new fiscal and monetary policies, the the whatever the
current geopolitical climate is, all those things are going on simultaneous.
And because of that, looking at you know, the mag seven,
the S and P five hundred, you know was trading
somewhere around twenty five times forward estimates, and you know,
(03:44):
that was just too high. And so we said, you
probably want to trim trim stocks here and on Twister,
and again we were one hundred percent right. So hopefully
you're listening to this show each week or tuning in
on YouTube to get the previous episodes. Uh, so here
(04:11):
we are. Now there's new. We talked about stagflation last week.
Now now you know, stagflation is becoming more of the media. Uh,
and recession, you know, and recession Now, all that talk
during you know, twenty twenty two, Oh, the recession is
coming because of the results of you know, inflation and
(04:36):
high interest rates and all that we were going to
go into recession. And I kept saying, there is no recession,
There will be no recession as long as employment at
that time was you know, under four percent. Yeah, I'm
also saying that there will be no recession, and if
there is, it will be a short lived one unless
(04:58):
unemployment goes above well.
Speaker 3 (05:01):
And I was reading an interesting article and it laid
out a lot of you know, good content in regards
to were we already or any recession because the numbers
have been fudged. Right, there was a lot of government spending,
which helps prop up There was an increase in government employment. Right.
(05:23):
There was like one point eight trillion in spending government
spending in twenty twenty four alone. And then you have
all of these revisions. And we've talked about that in
the past, where the employment numbers and what have you,
and some of this data coming out are up here
looks great, but then months later they come back and say,
oh no, we're revising that downward by six hundred thousand
(05:46):
or the previous years or earlier than that was like
a million. So was the data and kind of the
government spending helping to.
Speaker 2 (05:55):
Prop up government deficit spend exactly. That wasn't actually money
that was taken in. That was further borrowing exactly, further
printing of money, which is which I don't care what
you do. You know from from a monetary policy from
the central bank that as long as you keep spending
(06:17):
more money than you're taking in, inflation will remain high. Now,
think of the things that they're doing to come back
actual inflation, which starts from spending and then trickles down
into you know, energy production and energy prices. So if
you get spending under control and you get energy prices
(06:39):
under control, all prices will go down. And if all
prices go down, including interest rates which have gone down
from over five in the ten year treasury to about
four point three last week, well then you'll see hiring,
You'll see you know, capital expenditures, you'll see you know
(07:00):
GDP actually grow, and therefore there won't be in a recession.
Speaker 3 (07:05):
Also, there will have to be I mean, there is
this temp there's this temporary period hopefully it's temporary of
figuring out and the corporations are going to have to
figure out the whole tariff, like what is actually going
to be imposed, what is not, what's exempted, what's not,
and then figuring out their pricing. Right. So I think
the like Trump said in his speech you know this
(07:27):
last week, that there is going to be some disruption.
It is going to be a little bit tough because
this thing has to get figured out, right, how much
retaliatory tariffs from other nations are going to come in?
How long is how long are they going to keep
it up before they start really coming to the negotiating
table and going the direction that he wants to go,
which is reciprocal. Yeah, you bring years down and we'll
(07:49):
bring ours down, and then we enter a free year.
And that's going to be not gonna be t Yeah,
but we'll have free er trade, right because if if
terriff around the world, if the bar is lowered, it
just creates a better environment.
Speaker 2 (08:05):
For demand and for all.
Speaker 3 (08:09):
But until then, until then, it's a guessing game, you know,
And what do we do with our inputs? What do
we do with our steel inputs, our aluminum, whatever the
case may be, right, and do we need to raise
our prices now or can we do we take it hit?
And how long can we take a hit before we
raise prices?
Speaker 2 (08:26):
You know, I was listening to one of the morning
shows this morning on Fox Business. I think it's called
uh making Money or whatever it is, and and and
the main speaker had interviewed or was going over an
interview with Governor Ynkin out of the Virginia's I forget
which governor he is of West Virginia or Virginia, doesn't
(08:49):
really matter. One of the things that you know, he
was discussing with the governor is that the the cuts
to you know, the federal workforce and the state workforce
and how many people would be unemployed. And the governor's
response to that was, yeah, but there's three hundred and
fifty thousand private sector jobs open in the state of
(09:13):
Virginia or West Virginia or whatever the case may be.
Speaker 3 (09:17):
And do they want to do they want to hire them?
Speaker 2 (09:20):
It would be the case hire workers who do nothing.
Speaker 3 (09:22):
I mean, there was I think I think seventy seven
I heard seventy seven thousand federal employees took the you know,
cut out early package. I forget what they called it,
the early retirement, yes, right, and seventy seven thousand took
that package. So it's like, wow, yeah, seventy seven I mean,
I know that's not a huge percentage amongst the federal employees,
(09:44):
but still to think that there was seventy seven thousand
that well, if they started investigating, I'm p we're not
going to cut it, or maybe they were already near
retirement and said, you know, I'm just going to retire early.
You know.
Speaker 2 (09:54):
Yeah, the reality is is that could be seven hundred
and seventy thousand before it takes really a bite out
of expenditures that the FED has been paying out of
tax payer money on worthless employees. And they are worthless.
I mean, there's been studies of like fifty percent of
(10:15):
the federal workforce wasn't even going to work. The federal
buildings are unoccupied and and most of them they don't
even know what they do all.
Speaker 3 (10:25):
Day for the well, and I think that's not I
don't want to we don't want to put that on
the individual worker themselves. I think it's just the system itself, right,
which which is which comes which comes from the top
right and filters filters down. And my wife has had
some contracts with with state, you know state contracts because
she was an independent contractor. And some of the things
(10:45):
that she was telling me, and the and the spend
that they have, and especially during COVID, it was like, wow,
they're spending so much money, like on marketing or this
or that. And and then all of a sudden, a year,
year and a half, two years go by and they said, oh,
you know what, then they just realized it's like came
out of thin air. We don't have enough money. We
got to start laying off contractors. We've got to start
(11:06):
laying off people, and say, did you not plan for this?
Did you not use an Excel spreadsheet? Word budget?
Speaker 2 (11:12):
They don't know the word revenue because these government entities
at all levels rely on taxpayer money, so they don't
care to budget or create a pro forma. They don't
worry about profit because they're not for profit.
Speaker 3 (11:30):
But I think where the pain could be is that
not only do you have the the government employees that
could be gone right because they would say, okay, you
guys aren't producing or hasn't been profitable or spend a
waste of money. But then it's also contractors. I was reading.
For every employee, there's like two or maybe three contractors
(11:51):
which are private, right, but they work for the state.
They're going to be out of a job as well.
Speaker 2 (11:56):
All Right, you're listening to the wise mighty guys, John
Scambra and Seppi Veskani, and we were talking about, you know,
all of the things that have caused the market volatility
as we predicted, as we said, look for a bumpy
ride in twenty twenty five, and as Giuseppe said in
twenty twenty four, we were saying that twenty twenty five
(12:17):
will probably be a good year, but it wasn't going
to be easy. And so with that being said, what
should you be looking at? Once again, I truly believe
people should have or should be trimming their highly profitable
stock positions and looking to fixed income or alternatives as
(12:39):
a source for finding lower, lower correlated investments to the
S and P five hundred. Yeah, and don't you just
think about that?
Speaker 3 (12:47):
Yeah, and diversifying, especially if you've had a you know, uh,
primarily one hundred percent or near one hundred percent stock
portfolio and been riding a nice wave in twenty three
and twenty four. Yeah, yeah, good, good time too. And
actually this week has been pretty volatile and it's pulled
back quite a bit. You know, can it continue on potentially?
(13:10):
Not really great timing, but as we have said before,
you always want it in the beginning of the year
especially is look at rebalancing. So if you're heavyweight, or
you started with a sixty to forty portfolio sixty percent stocks,
forty percent bonds and you let it ride, you never
touched it for twenty three and twenty four, well at
the end of twenty four it probably was more like
(13:32):
sixty five or seventy percent stocks and thirty percent bonds.
So that's that's the important factor of where we say, okay,
valuations are a little bit high, you want to trim
from stocks so you can rebalance and get back to
whatever that initial allocation is that's going to line up
with your risk tolerance, your time horizon, whatever your plan
(13:53):
says to get you to your goals that you need.
Speaker 2 (13:55):
I mean, and you can also look at it that
if you are truly you know, if you're retired and
you are a long term cash flow investor and you're
in the right type of stocks. Could you potentially be
at be adding more to the higher dividend, higher value
you know, large company stocks here, don't you think?
Speaker 3 (14:17):
Right? Right? And even some of the high flyers too,
like Palanteer, Right, that thing took way off and I
think it's down more than forty percent. So if you
didn't own in, you're like, oh, I wish here's opportunities
where you can start. Now. Do you go one hundred
percent in? No, But you start nibbling in and say, Okay,
I'm gonna buy a little chunk here and kind of
see how things go out for the next week or
(14:37):
two weeks or month, and then buy a little bit
more and you can dollar cost average in yeah, to
a position size that makes sense for your overall portfoliot it.
Speaker 2 (14:45):
I guess it's been within the last year sometime. But
we actually talked about Pallunteer quite a bit when it
was in the twenties and then it went to one
hundred and twenty something and now it's back into the
seventies and so it's still at records. And that's the
type of position that I'm saying within your portfolio you
(15:07):
should look at. Do you want to lose more of
your potential profit or you know, do you keep buying
on the dips. Pallanteer is more of a you know,
a high flyer as you labeled it. I certainly believe
that the big companies that you know either buy back
(15:28):
their stock with their excess capital or share it in
the form of dividend. Those are the types of companies
that I think, you know, you buy the dips and
whether it's one that you know is one that's doing
a lot of buybacks like an Apple or a Microsoft
or any of those, or ones that pay a higher dividend,
(15:52):
you know, like an energy company like Enterprise Product Distributors,
which is a natural gas company that high dividends. Those
are the type of of you know, strategies and stocks
that we think, you know, you're okay you know long term,
if you decide to hold them and or buy more
(16:14):
of them, would you agree?
Speaker 3 (16:16):
Yeah? I think I think overall, as long as the
company has solid fundamentals, it's on a good trend. Now,
you know, there's gonna be there's gonna be times where
I think the big key is you don't want to
get married to a company because a lot of times
what happens is you'll see You'll see somebody they'll do
investigation of the company, or they maybe work for the
(16:37):
company before, or they like it, or they like the
products or whatever the case may be, and they just
get married to it, right, and then they continue to
buy and continue to buy it. But it's just a
continued downtrend, right. It could be a downtrend for a
year or two years, and it may have a good dividend,
Like Verizon is one where if you've owned it like
a couple of years ago, it hasn't done too much, right,
(16:57):
it's actually gone down, pays a great day it end.
So you have to take that into consideration as well.
Is not just looking for a company that has an
attractive dividend and say, oh, perfect, I'm going to buy
that one. You have to do a little bit more
work than just that, because you have to look at
where is it at? Is it valued high? Is it
(17:18):
at the right price right now? Where we think it
has some price appreciation and it has a good dividend.
Those are the stocks and companies that you want to
get into.
Speaker 2 (17:25):
Yeah, now what you should absolutely do. I'm going to
tell you what you should do. It's a couple of
different things right here. First of all, if you have
no idea what to do based on what is going on,
you absolutely, at a minimum should come to our workshop
next week on March twelfth, from six to seven thirty
(17:47):
pm at the old Spaghetti Factory in Conquered. How do
you do that? You can call nine one six ninety
six seven thirty five hundred, or you can click on
the link in this at our YouTube video to go
to our website and there's a chatbot that comes up
(18:08):
that you can say, I want to register. There's also
a register right on the website you'll see register for
the for the March twelfth workshop, or you can also,
you know, just come in for a no obligation consultation
if March twelfth doesn't work for you. And the reason
(18:29):
why you want to do one of either is if
you don't know what to do or how to rebalance
your money or where you know to find these opportunities
based on what is going on. Don't go it alone.
Why anybody would want to be in their sixties, seventies,
eighties and not working with you know, somebody like Giuseppe
(18:52):
and I has always baffled me. You know, our fees
are first of all, in a rear, so we haven't
met that in a long time, so more than likely
you'll have a Charles Schwab account. You may already have
a Charles Schwab account.
Speaker 3 (19:07):
That's who we use as a custodia.
Speaker 2 (19:09):
If you're working with us, that is our main custodian,
and we charge our fees in arrears. Our fee averages
one percent a year. And here's what's interesting. Often we
find in the mutual funds or active ETFs that a
lot of folks are already paying one percent in expenses.
Speaker 3 (19:29):
And many times.
Speaker 2 (19:30):
When we rebalance their portfolio, we save you on the
one side, even though we're increasing it on the other
and it can become a partial or even you know,
an entire wash. Now we don't know that, but that's
something we can discover when you come in for a
no obligation consultation or if after attending our workshop you
(19:54):
decide to come in for a no obligation consultation, and
what we show you in either case, whether you come
in for a one on one which has absolutely no obligation,
or come to the seminar, we're going to show you
exactly what we think in exactly the types of positions
and investments that we think are appropriate for people who
(20:17):
are retired are about to retire. The great thing is
is at that workshop we're going to explain in more detail.
Strategy is like the use of options, strategies like the
positioning of alternative investments in your portfolio and their correlation.
Speaker 3 (20:34):
With stuff are and what they pay.
Speaker 2 (20:37):
Yeah, the strategies to your point of finding higher cash
flowing income investments to offset volatility where you don't have
to buy and sell a position if it pays a
good cash flow. All of these things are crucial as
we continue to go into twenty twenty five and beyond.
(21:01):
So again, if you're in your you know, late fifties, sixties, seventies,
even eighties, and you're going it alone, give us call
at nine one, six ninety six, seven thirty five hundred
And why should you listen to us? I often wonder,
and I'm going to tell you why.
Speaker 3 (21:19):
I don't know.
Speaker 2 (21:20):
Well, because we are what I like to describe as
battle tested. DUSEPPI and I have been helping people in
a variety of different ways with their money for almost
fifty years combined. I got into the industry in ninety two.
You got into the industry in two thousand and eight,
(21:42):
and we have seen and helped guide people through good
markets and bad markets. High inflation, low inflation, you know,
high interest rates, low interest rates, tariffs, no tariffs, you
name it. You know, geopolitical tension, no, yep, no geopolitical ties.
And when you're working with somebody, you should know and
(22:05):
be working with somebody who has that level of experience
when it comes to something so important as your money.
Speaker 3 (22:13):
Right, So.
Speaker 2 (22:16):
Once again, if you want to meet with us for
a no obligation consultation, and I absolutely mean no obligation,
We enjoy meeting people and we enjoy giving them advice,
whether they take it or not. We hope you do,
and we hope that you know through that giving of
(22:36):
what we feel, you know, based on our experience, is
a good direction for our clients. We hope that you
you might, you know, hire us, and if we're a
good fit, that's the end game. But if we're not,
there's no pressure, right we don't.
Speaker 3 (22:55):
Yeah, not everybody's going to be a good fit, and
it goes both ways, you know. Not every client that
comes in ends up being a good fit for us,
and you know what we do and provide for clients,
and we'll let you know that as well. And I think,
to piggyback on what you were talking about before, it's
not only just our experience of how long we've been
in this industry, but the other part of the experience
(23:17):
is getting to know all of the clients or potential
clients out there having those conversations. Even though a majority
of our client base is some year or in retirement already,
they all have different lives, they all have different timelines,
they all have different experiences and situations in their life,
and those are the things that really build us up
(23:41):
and our experience level because we, through our clients, are
able to see what's around the corner, right, And that's
a lot of times when somebody's retiring, is not only hey,
I want to be able to retire and spend let's
say five or six or eight thousand dollars a month
to cover all of the needs that I that I
have as far as essential expenses and some of the
(24:02):
traveling I want to do and whatever whatever it's going
to be. But then also what if this happens, what
if that happens, or if there's a curveball, how's that
going to impact? Am I going to be okay for retirement?
Can this last for twenty years? Those are the things
that we have experienced as far as battle tested because
we've been through some of those experiences for the unforeseen
rather the unpredictable events that come across clients during the
(24:25):
retirement years, and those are the things that we really
learn from as well as the markets and ups and
downs obviously, and then we run that through a plan
and run different scenarios. So we take these base scenario
of what do you want to have happen when your
retirement if everything works out perfectly, what is that going
to look like? And we model that out and then
we throw in some curveballs what if this happens, what
(24:47):
if that happens? And stress test it to see if
it's going to fall apart or can it withstand it? Yep?
Speaker 2 (24:54):
You know, strategically, we've already talked about some of the
things that we think people should be doing or their
advisorship be doing, and if they're not, you know, you
should come to our workshop or come meet with us.
But you know, right now we think you should be
trimming you know, your highly appreciated stock positions, doing some rebalancing,
looking for more low, lower correlated investments to stocks, and
(25:17):
then also focusing on the cash flow of investments that
you're putting your money into. Do they pay a dividend,
do they pay interest? How often do they pay that
dividend or interest? And you know, is it at a
number that keeps up with inflation. We have inflate investments
that exceed from a cash flow perspective what the published
(25:40):
rate of inflation is, and that's very important when it
comes to not running out of money. So right off
the bat, you know, those are things that you know,
I hope people are taking to heart. And more importantly,
you know this this this type of climate that we're in.
The number one thing CAUSEPPI that we see people doing
(26:03):
when they're going it alone is they panic. And usually
when they panic, they're making the wrong decision right now.
Speaker 3 (26:11):
Like if they got into Palenteer and bitcoin in the
beginning of the year the end of last year at
a high rate, because they're chasing it and there's euphoria
and it's being spread all over the news. Bitcoin hit
a new high over one hundred thousand Pallenteer and this
and that or in Nvidia even right, and they're buying
it in and now here they are they've only owned
it for three months and it's shed right, double healthy,
(26:33):
double digits, twenty thirty forty percent, And I'm like, oh
my gosh, I hold on to it. Do I sell it?
Then they sell it, then they're in cash, and then
it starts going back up, and then and then they're
hesitant to get back in. I'm not sure. And that's
that's the part that kills people's portfolios. Is when you're
looking at something at a three month time horizon, it's
(26:55):
going it's not going to work out, right, especially when
you're doing retirement planning. You got to look at a
long term time horizon, and there's better times to get
into positions than others. And you know our valuations high
should you add into it? And you don't want to
bet the farm on it either? So maybe you got
into bitcoin because euphoria, but if you put bet the
(27:16):
farm on it, now you're hating it. Yeah.
Speaker 2 (27:19):
So that's a really good point and one that we
can't emphasize enough that we continue to talk about weekend
and week out is don't over bet on any one position. Right,
we use a five percent rule of thumb. Some things
that are more conservative will go a little bit higher
as an entering dollar amount. Some things that are a
(27:40):
little more aggressive will go a lower amount. So but
in any case, use that five percent rule when, especially
if you're entering a new investment to your portfolio, and
then see what it does. See how it reacts to news,
See how it reacts to interest rates, See how it
(28:02):
reacts to you know, the FED meetings every other month
or each month, so on and so forth. So that's
another important, you know, rule of thumb or strategy if
you're going it alone.
Speaker 3 (28:17):
And the other thing is that the key thing is diversifying,
right if you're not, if you're far away from retirement,
then it's just all about accumulation and growth. So dividends
and those sort of things you're not going to matter
as much. They do help during a volatile environment as
far as the market, because dividends will kind of offset
some of those losses. But overall you're looking to just accumulate.
(28:39):
Most of our clientele are in the retirement or nearing retirement,
so that cash flow component of the overall portfolio via
dividends and interest from either fixed income or bonds or
stocks or alternatives that payout dividends or interests. That's going
to be a nice component, especially if you can build
out a portfolio like on said, that generates enough cash
(29:02):
flow where you're not in a situation where you're having
to sell off assets. Right So, like right now, the
market's volatile. Now, if you've built a portfolio and let's
say you needed five or six percent cash flow from
your overall Let's say you have a million dollars and
you say, you know what from that million bucks, I
have some social security, maybe I have a small pension,
and I'm going to need about fifty thousand dollars a
(29:23):
year from my portfolio. Well, if you're generating, and you
have a portfolio that's generating five percent or north of
five percent and dividends and interest right per year, then
it's generating it you're not faced with, like right now,
having to say, oh, I got to sell off some
you know, XYZ stock or this position or that position.
It might might not be a good time to sell
(29:45):
it because the market's just pulling back, right, So you
don't want to sell from capital. And that's what we
look for, and that's what we really where the goalar.
Speaker 2 (29:54):
Really comes in too. Well, the plan say, what is
the interest you need to.
Speaker 3 (29:59):
How hard do you ask need to work? Yeah? How hard?
Does it need to be? Conservative? Moderate? More aggressive? What
kind of return do you need? Yeah? Exactly.
Speaker 2 (30:07):
Now let you mentioned something diversification. Let me tell you
what diversification is not. Diversification is not having you know,
different brand mutual funds and then thinking you're diversified or
different brokerages, right, or that's my favorite when I have
different brand mutual funds at different brokerages, so I think
(30:30):
I'm diversified because I'm diversified and firm, and then I'm
diversified in brand name product. You are not diversified. You
are actually probably over invested in stocks or in bonds.
And how many times over and over again do we
find that? And then on top of that we find
(30:50):
that the fees inside of the funds are you know,
are a portion of what our fee or sometimes the
funds have higher than one percent annual expenses. So again,
if this sounds like you, if you have you know,
north of you know, a couple hundred thousand dollars to
(31:12):
millions of dollars and you have mutual funds, especially open
ended mutual funds, and your accounts are at multiple firms,
you're probably doing yourself a huge disservice. Come to our
workshop on March twelfth at the Old Spaghetti Factory in
Conquered from six to seven thirty pm, or come in
(31:34):
and sit down with us for an hour. I promise
you it'll be a good use of your time either way.
Called nine one six ninety six, seven thirty five hundred
and I hope you're enjoying the show so far. I
mean I'm looking at my notes and going, man, this
is packed with really important things based on what's going
on right now, that you should be doing. But let's
(31:57):
talk a little bit more on what's going on. I mean,
we didn't even dive in to your notes here on
all of the different things that you know have led
us to where we are right now. And then we'll
continue to talk about, you know, things that we think
you know will help you in your effort to you know,
make twenty twenty five a good year from from a
(32:19):
from an earnings me mean what your portfolio earns perspectives? Right?
Speaker 3 (32:24):
So what are I mean? Yeah? And this comes from
an article we have subscriptions and things from all kinds
of different resources and resources economists and other investment analysts
and every DAEA source you can imagine, just trying to
get some good data out there. But there's the fear
of recession that's that's arising again. And and this article
(32:46):
specifically was talking about and pointing to different components and
indicators of you know, are we already in recession or
is it just being delayed? And what what are some
of those components and what has happened and in the
last term, you know, with Biden and then what's going
on with Trump and is there going to be something
(33:06):
that's taken place with triggering it. But it was it
was very interesting because one of the polymarket odds, which
is basically just statistics of saying, like what you know,
is there a higher probability recession now, but that's been
on the rise, and that's up to like thirty nine
percent right now, where it was like in single digits
not that long ago. But you take the Atlanta Fed
(33:29):
GDP now, which is forecasting the next quarter or q
ones GDP to go negative negative two point eight percent. Now.
The original description or definition of recession is two quarters
consecutive quarters that have negative or contracting GDP, so that's
(33:50):
why it's now surfacing. So that's two point eight percent
negative forecasting. We'll see what, you know, what it comes
in at. There's been a lower labor force participation that's
at sixty two or just under sixty three percent versus
it was sixty six percent in two thousand and eight
during the financial crisis. And then the government job growth
(34:12):
has been masking private sector weakness. So some of the
points are has the economy, which the data has been
showing that the economy strong, job market strong, so on,
and so forth, has that been masked during the last
administration by you know, we can see it from revised
(34:33):
downward or downward revisions on the job numbers, right, and
we just had one March twenty twenty four was revised
down almost six hundred thousand. That's a big numb that's
not like a oh we missed a few.
Speaker 2 (34:44):
Confidence according.
Speaker 3 (34:48):
Explosive deficit spending one point eight trillion dollars just last year.
And then immigrants, so this has been a hot topic.
Immigrants filing most new jobs three point two million since
twenty nineteen versus nine hundred and seventy one thousand for
US born workers. Right, So has that kind of masked
(35:08):
or inflated. And then GDP, you know, has inflated by
the by the government spending. So how much of the
government involvement or influence has propped up some of the
GDP and the economic numbers and indicators. And now that
we're unraveling some of the wasteful spending. And you know,
(35:32):
Trump's been doing a good job of finding foreign investment, right,
Taiwan Semiconductor one hundred and sixty five billion, Honda now
putting a plant in Indiana SoftBank was it five hundred billion, Yeah,
five hundred So these are not you know, deficit spending.
It's actually bringing money in either from other nations or
(35:54):
other outside corporations or corporations themself. Apple also is going
to be investing billions of dollars as well and expand
ten years or whatever it's expending. But that all takes time, Right,
that's not instantaneous. It's not like government goes out and
say we're wins exactly. But that takes time. And so
(36:15):
that's where we say, hey, it's going to be a
bumpy road. We think it's going to be a good year,
but the beginning part is going to be bumpy because
all of these things take a little bit of time
to work its way through and then seeing the results
of it, and it's a lagging indicator. And right now
we'll get to see GDP if it isn't you know,
if Atlanta Fed GDP now is forecasting negative two point
(36:35):
eight or if that changes. But that's why recession fears
are coming up. And we'll we'll get to see if
the new Trump policies is going to create a further
downward trend and trigger recession or is it going to
pull us out of it right and kind of do
away with some of this government stimulus to make it
look like it's a great economy.
Speaker 2 (36:56):
You know what that all adds up to me, Giuseppe,
is that now going forward, when I'm looking at investments
and where I should park, you know, moving money from
cash or money market, that's where fundamentals will matter, because, okay,
if you're a company that can continue to grow its
(37:17):
bottom line in this type of environment where you have
so much pressure on the upside of your of your
stock price, like in Vidia. Like in in Vidia where.
Speaker 3 (37:30):
They knocked out, they knocked it out of the park
for earnings, but it wasn't enough to get their stock
price to continue to just fly to the moon.
Speaker 2 (37:39):
Yeah, and and but that also boils or goes back
to you know, their valuation and and some of the
multiples that you know a lot of these companies, like
in Nvidia got to. So so again, when you're looking
for where to put your money or where are you
going to find, you know, growth or income that keeps
(38:01):
up with or exceeds inflation. Now, obviously, if we go
into a recession and we true, true, truly, and I
don't believe we are going to see a retraction in prices,
well then it'll be easier to outpace inflation from a
cash flow perspective. But that's where we're going into this
(38:21):
potential stagflation, which is lower growth with rising prices. And
so again, when it comes to where you're going to
park your money, if you don't know what to look
for or what strategy to employ, or how to you know,
mitigate your risks as as as best as you can,
that is why this is not a year. This is
(38:44):
not the time when you're retired to not work with
a professional, to not have a plan. So whether that's
with us or somebody else, you immediately want to, you know,
revise your existing plan or start a plan. If you don't,
it doesn't matter if you're retired. If you're retired, you go, well,
(39:06):
I already saved all the money I'm going to have.
I have everything I have, I'm going to pay. I
paid off all my debts. I get it. It is
what it is. But it's still important to understand your
tolerance for risk. It's still important to understand what level
of return you need to make on your money so
that if we do stay in a period of high
(39:27):
for inflation for a decade or more, which is very
possible i e. The seventies and eighties, that you don't
run out of money. So you need to know what
your money needs to make with inflation assumed, in order
to not wake up if you're sixty five now and
then you're seventy five, and if you're seventy five now
(39:48):
and then you're eighty five and find out that you
can no longer pay your bills.
Speaker 3 (39:52):
I think that's an important point because a lot of
times when people just kind of do the back of
the napkin math and say, oh, I have a million bucks.
I can put it in a CD that CDs paying
me four percent, it's forty thousand bucks that on top
of my social security. You know, that's going to be
plenty of income. And you're looking at it in time
today now, But what happens five years from now, what
(40:14):
happens ten years from now? Things don't get cheaper, they
get more expensive. Now, we're hoping with these policies that
are being put forth that it starts slowing the rate
of growth and kind of bring some of the you know, variables,
which is going to be food and energy for all
of us to start coming down from what we're paying correctly,
you know now. But everything else, the services and the
(40:38):
subscriptions and what have you, that's going to be more
expensive five, ten, fifteen years. That's very important to factor
in that inflation into the plan to say, okay, now,
what does your money look like and how and is
four percent enough or do you need five percent or
five point five right to just get you to where
you want to go to spend that forty thousand dollars today,
(40:59):
because you five years from now it might be forty
five thousand dollars. Ten years from now might be fifty
thousand dollars year that you're actually pulling out. Yeah, exactly.
And so here's what it all boils down to. If
you're retired or about to retire and you want to
understand more of what you can do to help yourself
or what you can do you know by hiring us
(41:21):
to help you, either call us for a no obligation
consultation or register for our workshop if you're retired or
about to retire. The workshops on March twelfth, next Wednesday,
from six to seven thirty pm in Conquered at the
Old Spaghetti Factory and so call us at nine one
(41:42):
six nine six seven thirty five hundred. Again that number
is nine one six nine six seven thirty five hundred.
I do want to mention YouTube channel will be doing
it for a couple months. So if you've been a listener,
whether you've been a long standing listener or new and
you want to put a face to the voice, check
us out. You just type in the Wise Money guys
(42:04):
on YouTube will pop right up. A lot of times,
I'll put a contact, charts, economic data, some of our
thoughts around that of what's going on in the market,
So good to check into that. Midweek as well.
Speaker 2 (42:15):
All right, you've been listening to John Scambering, J Seppie Fiscani.
I hope you enjoyed the show and have a wonderful weekend.
Speaker 3 (42:21):
By 'all, talk to you next week.