April 18, 2024 • 35 mins
Chuck Zodda and Mike Armstrong dive into Amazon's secret operation to spy on rivals. Americans are sick of 0.01% yields create new dilemma for Wall Street. Are there too many passive investors? Is that actually a thing? The IRS has some new rules that you might need to be aware of.
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(00:00):
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The DAV five K Boston is presentedby Veterans Development Corporation. This is
the Financial Exchange with Chuck Zada andMike Armstrong. A little bit after eleven
here on the Financial Exchange, we'vegot markets attempting to stage a rally.
Yes, that's right, we're seeingsome green on the board after what has
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been tough five days we've been it'sbeen six days. We haven't had a
day in positive territory since April eleventhon the S and P five hundred.
In fact, in some areas ofthe market it's been worse than that.
Boeing Actually, if up today,it would be only boeing second day of
gains for the entire month of April. Other than that, every other day
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has been down for Boeing this month. A lot of Charlie Brown moments to
this last few weeks where markets arelooking our right to start the day and
then boom, the football gets pulledout from Mondy. It's been price action
that's really reminiscent to me of Septembertwenty twenty one, which was a really
similar setup. Not in terms ofthe overall you know, economic situation was
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very different back then, but itwas just you know, a couple weeks
in a row of it just feltworse than it was because the market would
open up half a percent or twothirds of a percent and by the end
of the day closed down half apercent, and so you just felt like
you were getting whacked like one toone and a half percent each day.
And then you'd look up and you'relike, oh, markets are down like
five or six percent. It wasn'tactually that bad. This is kind of
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similar where it's like, hey,you've got you know, these markets that
keep opening up in positive territory,and it's like, oh, this is
awful, and then you actually lookat the scoreboard and you go, well,
the S and P five hundreds downfour percent from its high. It's
not that bad. Yep. Obviously, look if you're trading, you know,
intra day and with leverage and thingslike that, it can be much
worse than that. But I'm guessingmost of our listeners aren't doing that because
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most people aren't doing that. Speakingof things that most people aren't doing,
Amazon, according to a Wall StreetJournal exclusive, I'll quote here, this
is actually I'm I'm trying to figureout what percentage I should be disgusted by
this and what percentage should be youknow, kind of admiration because it's a
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little bit of both. Quite honestly, for nearly a decade, workers in
a warehouse in Seattle's Denny Triangle neighborhoodof ship box of shoes, beach chairs,
marvel t shirts and other items toonline retail customers across the US.
The operation called Big River Services International, says around a million dollars a year
of goods through e commerce marketplaces likeeBay, Shopify, Walmart, and Amazon
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under the brand names such as RapidCascade and Spa Bliss. We're entrepreneurs,
thinkers, marketers, and creators.Big River says on its website, we
have a passion for customers and aren'tafraid to experiment with The website does say
is that Big River is an armof Amazon that surreptitiously gathers intelligence on the
tech giants competitors. So these areall Amazon employees who, under direction of
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Amazon Corporate, started this separate companyand the entirety for its existence is to
gather data on its competition. Andthere are apparently troves of documents from corporate
attorneys at Amazon. This is acode named Project Curiosity. By the way,
why do they have to always havecode names. I don't know,
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well, because if it was ProjectBig River Services International, then it would
get out pretty quickly, I guess. But it already did get out,
Yeah, I did, but ittook a decade. You know, advice
or you counsel from attorneys there saying, you know, make sure you don't
bring this up on corporate earnings callsor you know, disclosed to other employees
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of what you are doing. Don'tmake it public to you know, the
competit what you are doing here,et cetera, et cetera. So what
sort of information might you be ableto get if you are a seller at
eBay and Walmart as well as atAmazon. I guess a whole lot of
price data and commission data on howthose other platforms are working. Well,
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you're going to get that. You'regoing to get information about how their distribution
works and how they're shipping works.Yep, you're going to know how their
logistics network works, because you're goingto know you know, what goods need
to be in what warehouse at whattime in order for them to ship and
be delivered on time. You're goingto get information about how you're able to
negotiate with them and what things they'rewilling to negotiate on and what they aren't
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probably information also just on the shippingaspect of it. Hey, who handles
this shipping and you know, what'sthe cost of that shipping? You know,
you'll be able to get that kindof information too. You'll be able
to understand how their discounting program maywork. Hey, you know what kinds
of discounts can we pass through?Who? You know, does the the
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you know, the seller take thediscount or does Walmart eat it? Are
there ways to shift that? There'sall kinds of different information that you can
get most certainly, and apparently thefocus on this was on Walmart just because
it's the biggest retailer in the countryand so obviously they're more of a you
know, concern for Amazon than anyoneelse. But it's something where they were
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just trying to gather as much dataas possible on how the operations of these
other companies worked, and they didall kinds of things to try to keep
it, you know, hidden.They would you know that they had full
big River you know email addresses aswell as Amazon ones, and they took
pains to make sure they were youknow, using the right communications through the
right ones. They always you know, presented themselves externally as big River employees
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and things like that, and youknow, they spend a lot of time
and effort on trying to make itseem like they weren't in any way affiliated
with So I have a few questionsabout all of this that I genuinely don't
know the answer to. One.I would assume that this is probably a
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violation of Walmart Ebays and all theseterms of service, right, I mean,
probably you are not supposed to dothis type of thing, and I
would imagine it's explained in the contractthat you signed with these companies when you
sign up. So yeah, potentiallyviolation of that. But does Amazon really
care. Probably not these worst casescenario, they kick them off the platform.
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In terms of legality, I don'tknow that they've actually broken any laws
here. I'm not sure that therewould be any sort of disclosure requirement for
instance, consumers that you're buying fromAmazon and not, uh, you know,
the eventual ownership is an Amazon corporation. But I do think it comes
to if you're trying to bring acase against Amazon in the future about the
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harm that you are doing to consumersas a monopoly. This is pretty good
evidence. There also is let's seehere. I don't know that it would
necessarily apply here. There is Innineteen ninety six, the Economic Espionage Act
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was signed. I don't know ifit. I thought that mainly had to
do with foreign competitors spying on domesticcorporations. That's part of it. This
is there's other parts here that mightapply. I don't know, Like,
there's one part of the code.I'm not a lawyer on this stuff criminalize
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the misappropriation of trade secrets related toor include a prank that's placed in interstate
commerce with a knowledge or intent thatthe misappropriation will injure the owner of trade
secret. Right, So maybe youcould say, okay, this won't injure
the owner necessary. I don't knowin any case. As I said at
the certainly distasteful. I go backand forth between it's it's probably unethical,
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but not necessarily immoral, if thatmakes sense. Okay, you know it's
it's unethical because it it's not somethingthat you'd want to see businesses do it.
You're lying to customers like, yeah, this is this is unseemly.
It's it's unethical, like you're you'rebasically pretending to be someone that you're not.
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Is it immoral? I'm not reallysure who was harmed by it,
Like it's you know, it's Idon't. I don't know that it's immoral.
So I kind of look at itand go, I probably wouldn't do
it myself if I were, youknow, starting a company like this.
But out of all the things Amazonhas done, I don't know that it's
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the biggest concern of mine. It'sjust more like it just feels a little
icky, you know, or thatsome of their competitors have done, specifically
some of the ones that they werespying on here. I remember the story
of the Massachusetts couple who were writingabout eBay a few years ago. I
mean, these are not innocent groups. If you haven't read this honestly fascinating
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story about how this couple in Massachusettswas writing what the reviews of eBay and
like a blog about the problems ateBay, and corporate leadership at eBay literally
took dramatic steps to intimidate them outof doing so very very illegal steps that
I think ended up sinking some ofthe executive team there, basically sicking their
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private security on these people. Fascinatingstory of different types of in my mind,
much worse moral conundrums, but thisone. Like I said, I
think the one thing that I goback to on this is if you're trying
to make a case that Amazon isanti competitive, it's been really tough to
make that case based on harming consumers, and I don't think that this necessarily
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changes. But if you're trying tomake an argument that no other company can
really compete with them because of thedramatic steps that they take across their business
model, this is another piece ofevidence because I'm sure that retail isn't the
only place that they're doing this right. They certainly have companies embedded in social
media advertising, companies like Facebook,they have you know, all sorts of
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I'm sure that this is a practicethat they employ in other areas of their
business, because retail isn't even themost profitable version of this. Let's be
honest, this is you know,a Wall Street journal piece that's on Amazon.
Would you be in any way surprisedif Walmart was doing this, I
would be surprised if they're not doingit right. It's and this is why
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I say, Look, it's it'sprobably like kind of unethical, but I'm
not sure that it's inherently immoral.I I just have seen far worse things,
as you mentioned. It's I andmaybe that's just I'm too hated by
this at this point that it's like, oh, like, there's so much
worse that goes on. But yeah, you're judging, you're judging on a
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pretty rough scale. Yeah, I'llgo back to you. I'm not going
to judge the morality or ethical partof it. It doesn't seem to be
illegal from what I can tell.And part of it also is Look,
part of the reason why these youknow, different companies are so profitable and
why it's so hard to break inis because a lot of this stuff is
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just automated on the back end.If there were anyone at Walmart who was,
you know, manually reviewing storefront applicationsfor companies on them, they might
have been like, Hey, thisdoesn't look right, maybe we shouldn't let
them do this. Just putting thatout there as well. The Financial Exchange
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This is the Financial Exchange Radio Network. Americans are getting sick of point zero
one percent yields at big banks,So I'll quote here across JP Morgan Chase
is broad suite of customer accounts.One number is just about everywhere point zero
one percent. That's the interest rate, and Chase Sapphire, Chase Premiere Plus
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and Chase Private Client checking accounts regardlessof someone has deposits of five dollars or
five hundred thousand dollars. So ittalks about how big banks for the last
you know, year or two havereally been able to continue to pay out
next to nothing on customer deposits.Can we can? We also cover the
savings account. The special savings accountgets you a w the interest rate to
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point zero two percent. It's twiceas high. I mean, did it
used to be? Did it usedto be? So dramatically different in terms
of interest rates when you went fromChase to I don't know, New York
Community Bank Corp. I guess iswhere I'll go with this one. Like
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it's just mind blowing. Here's thething. The big reason why this is
the case is that Chase doesn't wantmore deposits right now. If Chase actually
wanted more deposits, they have higherrates. But Chase has too many deposits.
I know that sounds kind of weird, but here's the basic math of
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it. Let's say that you haveone hundred billion dollars in deposits and you've
got ninety nine billion dollars in loans. You're saying, hey, I want
to make you know, another billiondollars in loans to get everything matching up.
If you don't have good loans tounderwrite, then you're not going to
pay more in order to get moredeposits so that you can do that.
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Like it's just you don't need themoney. So you say, no,
we're gonna pay less on deposits becauseif some deposits go away, that's that's
quite okay. It's it's absolutely fine. This is what Chase and other big
banks are doing right now because theydon't have enough good loans to make.
On the other hand, when youtalk about your small banks, the ones
that might be offering you know,four percent savings, five percent savings,
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things like that, a lot ofthose might have in the last year because
of concerns about bank stability after SiliconValley Bank collapsed. They might be chasing
deposits because they've got a bunch ofloans and they're like, no, we
need some more deposits in order tokind of shore things up here and make
sure that we can, you know, continue to make the loans that we
want. You might have banks chasingafter deposits in order to you know,
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basically be able to make the loansthat they want to make at this point
and to not be up against itfrom coverage ratio perspective. So I think
that when we look at this andyou know, ask hey, why is
JP Morgan Chase not paying anything ininterest, It's not because they hate you,
like they they don't care about youeither way. It's like you're it's
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you, yes, they it's it'sit's the classic Don Draper, I don't
think about you at all. Likethat's that's what Chase is basically saying.
They they don't think about you.If they wanted more deposits there, they
would have higher deposit rates. Butthey've basically said, and they said this
in earnings filings last year, Hey, we we don't have enough good loans
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to make, so we're not gonnachase after deposits right now. I do
find it interesting that both JP MorganChase and Bank of America. I don't
know Bank of America's numbers, butJP Morgan Chase intending to open five hundred
new branches by twenty twenty seven.Maybe that's just what the express intention,
being able to make loans in thecommunity. But on the surface, right
like, the reason you open branchesis finding new deposits at a time when
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they don't really need them very much. So yeah, interesting to do.
What a good question. But thereare areas of the country apparently where they
do not yet have that exposure,Boston being one of those. By the
way, bringing the latest financial newsstraight to your radio every day, it's
(17:23):
the Financial Exchange on the Financial ExchangeRadio network. The Financial Exchange is now
available on your Alexis smart speaker.Has to play the Financial Exchange and catch
up on anything you might have missed. This is the Financial Exchange Radio network,
Mike, Are there too many passiveinvestors? People have brought this up
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over time, you know, sinceI think the active managed mutual funds started
getting threatened from the likes of Vanguard, people have started asking, well,
what if everyone just sits back andpassively invests at some point? Doesn't that
create a danger to the stock marketor maybe an opportunity for active managers to
outperform their counterparts their counterpoints. Andthis article does point out that the share
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of money and passive funds was morethan fifty percent in January. That's up
from between thirty and forty percent backin twenty ten. So yes, the
use of passive index funds has increasedsubstantially. However, I think, as
this article attempts to point out,merely because you are invested in, say
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a passively managed index fund from Vanguardas an example, does not mean that
you are being passive with the waythat you invest. And I think that's
a kind of tricky and important distinction. Yeah, And I think the other
thing that I always do like topoint out is when we talk about again,
all indices are different, but theS and P five hundred. Just
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as an example, people you knowsay, oh, like, you just
have an index fund that's Standard andPoors actually has a set of criteria that
they use in order to decide whogets into the S and P five hundred,
and some of it does involve somejudgment. Actually, all you if
you are buying an S and Pfive hundred fund, you're actually buying a
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fund that is actively managed by Standardand Poors. Is just not actively managed
the same way that you know aconventional mutual fund would be. So it's
it's something where even within what looksto be a passive investment, there's still
someone who's making decisions. It's it'sStandard and Poors. It's not just the
five hundred biggest companies in the US. They have standards for profitability, they
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have standards for share price, likeall these different things, and it just
happens to be really hard to outperformthat benchmark. But ultimately, even the
S and P five hundred is activelymanaged, believe it or not. Likewise,
let's say I'm invested a bunch ofmy money in a passively managed index
of energy companies, and I decideto sell that and manage my money in
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a passively managed index of technology companies. I have moved from passive to passive
investment, but I'm doing active.So no, I don't think this really
tells you much of anything. Icertainly don't think it's anything to be concerned
about. I think the biggest conclusionfrom this massive shift that has undergone over
the last couple of decades has beena dramatic saving for individual investors in terms
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of how much money they've been ableto save on that overall transition from one
type of one type of investment toanother, because those passive, those passive
investments on buy and large are substantiallycheaper than what people were paying years ago
for the ways in which they invest. If this is sounds complicated, it's
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frankly because it is. I knowthat there are plenty of people that do
exactly what the author is talking about, which is every month pour some money
into a passively managed index within theirfour oh one K and that that is
a fair bit more passive than whatwe are discussing here. But if you
are doing that today and you havequestions about how that may or may not
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need to shift, the closer youget towards that date of what you're saving
for. This could be college,this could be buying a new home,
this could be the big one beingretirement. Then we frankly at the Armstrong
Advisory Group work with people every singleday to assess how that investment portfolio is
going to serve those needs and frequentlycome across folks that are doing it quite
(21:33):
well, and also frequently come acrossbig potential mistakes that are being made in
terms of how acid allocations are derived, how they are intentionally or not so
intentionally set up for what they aretrying to accomplish. So two big items
that want to make people aware of. One. We have a guide out
this month that's free all about preparingfor an upcoming retirement, and certainly how
(21:57):
you invest your money and how howmuch you need invested over that period of
time is a critical piece of thatoverall equation on how to prepare for that
upcoming retirement. You can get acopy of this guide by calling eight hundred
three nine three four zero zero one. Again it's our guide on preparing for
an upcoming retirement. But if youhave general questions as well, you can
(22:18):
go to our website to request theguide. You can call our office and
talk to a real, live humanbeing, but that phone number the website's
Armstrong Advisory dot Com. The phonenumber to request a copy of our brand
new guide for the month of Aprilon preparing for an upcoming retirement is eight
hundred three nine three four zero zeroone. The proceeding was paid for by
Armstrong Advisory Group, a registered investmentadvisor. Nothing in the ad or in
(22:42):
any Armstrong Guide a specific financial,legal or tax advice. Consult your own
financial, tax and estate planning advisorsbefore making any investment decisions. Armstrong make
contact you to offer investment advisory services, Mike. Yesterday, the IRS issued
guidance on inherited ir rays for thosewho inherited iras since twenty twenty and the
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guidance once again says that if youhave inherited an IRA in the last four
years so twenty twenty, twenty twentyone, twenty twenty two, twenty twenty
three, and now I guess thefirst three and a half months of twenty
twenty four, they are waiving anypenalties on required minimum distributions that may be
(23:25):
required. In final guidance from theIRS expected to maybe be issued later this
year, but not sure If you'reconfused about what I just said, here's
here's what this means. This islike the laughingstock of the financial advice and
Oka. This is the Bobby Bonie. This is baseball. Fans know that
Bobby Bonia has a contract that Ithink he's still getting paid from the Mets
a million dollars every July First,even though he hasn't played in twenty years.
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I think the last payment's coming upin like a year or two.
This is basically the Bobby Bonia contract. Where in twenty twenty, with the
original Secure Act, Congress change changedhow inherited iras were treated originally. Before
that, if you inherited an IRA, and to be honest, if you
inherited the IRA and still have it, this is how it operates. From
(24:11):
pre twenty twenty. You have totake a certain chunk of money out each
year, but you're not required toexhaust it in a fixed period of time.
Starting in twenty twenty, the IRSsays, hey, you've got to
take this money out in a tenyear period, okay, And then they
issued some additional guidance that, bythe way, you may have a required
minimum distribution still for each one ofthose ten years, but you also just
(24:33):
have to make sure it's done withinten years each of the four years since
that announcement. They have then waivedthe penalties for missing a required minimum distribution
on an inherited IRA that was inheritedafter twenty twenty, so nobody has any
idea what we're doing. They havesaid that later this year they are going
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to issue the final rule on requiredminimum distributions from post twenty twenty inherited iras.
We'll see if we get there.It's just but again, I know
this sounds really dry for somebody thatis just listening right now, but this
is genuinely important and just also reallykind of funny at how just stereotypically embarrassing
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this is for me. I arrestwell. I think the part that's tough
for me is just look like,we work in this business. We see
this stuff a lot, yep,and it still is something where every time
I see an inherited IRA, Ihave to go back and like look at
the rules to be like, Okay, let's make sure that this one is
set up, Like how does thisspecific one need to be done? Because
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there are literally at this point,I believe it's either six or seven different
possible outcomes for how it can bedone, depending on the exact situation in
terms of, well, was itpre twenty nineteen or post twenty twenty,
you know, post twenty twenty.Is it someone who is a spouse,
is it a non spouse? Isthe non spouse less than ten years younger
(26:10):
than the person who passed away?I mean, it's like, it's just
very, very messy, and II'm trying to think of like a comparison
in maybe the sports world or justevery parts of everyday life that are as
confusing, complex and convoluted as thisis. Nothing's really coming to mind.
(26:32):
It reminds me another baseball one foryou. Okay, this is like how
a walk counts as a plate appearancebut not an at bat. I so
it affects your on base percentage,but nothing else. Have you seen the
movie Basketball with the guys who createdSouth Park. Yeah, there's a scene
there there where they're describing how theteams make the playoffs and the wild card
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run, and it reminds me ofthat. Yeah, It's it's just it's
not something that has any common senseto it, and it would just be
easier if it's like Hey, retroactively, we're just gonna make it this for
everyone, and let's just make iteasy. It would be easier to do
(27:15):
that. The reason they did allthis, by the way, is because
they need to create some tax revenue, which now they have failed to do
so well. I guess this't hasn'treally changed, but the idea was,
hey, we need to create sometax revenues, so let's penalize the beneficiaries
rather than penalizing the people who arecreating these higher rays. Let's take a
quick break and when we come back, we'll do a little bit of stack
(27:36):
Roulette. Missed one of our shows. Catch up anytime by asking your Alexis
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Find daily interviews and full shows ofthe Financial Exchange on our YouTube page.
Like us on YouTube and get caughtup on anything and everything you might
have missed. This is the FinancialExchange Radio Network. All right, Mike
(28:04):
starts off, What do you gotfor stack Roulette? Some new programs around
New England on trying to boost retirementsavings, which we'll see how they turn
out. But I generally like thedirection this is going. Connecticut Maine to
name a few of these. Vermonthas launched a similar effort as well.
But here's the basic premise. Ifyou have a certain number of employees as
(28:26):
a small business five or more inthe case of Connecticut, you're now required
to offer a retirement program. Youcan do one of two things. Set
up a traditional plan like a fouroh one K or use this new no
cost state program, meaning the employerdoesn't face any costs to roll this out,
the employees might still face costs.Mains program, for example, is
(28:48):
the Merit Saves program. In January, some five hundred and forty businesses have
signed up so far, and thebasic premise is, hey, employer,
you're not gonna have to pay forthis, but you must sign up your
employees for this program that allows themto make contributions to their own retirement plans.
There won't be any matching contributions,but there's some automatic enrollment features,
(29:11):
there's some automatic increase features. Thebiggest downside to this is because they are
not from what I've been able totell, at least so far, because
they are not specific for h oneK plans and they're not you know,
they're not federal thrift savings plans oranything along those lines. They are basically
just IRAS problem with iras very lowcontribution limits. So this does not get
(29:37):
around one of those big problems andone of those big I think just conflicts
that's out there, which has alwaysbeen that, hey, if my employer
is willing to start before one K, for me, I can save tens
of thousands of dollars a year andsave on taxes. But if they don't,
then the IRS basically tells me Ican put away you know, six
or seven thousand dollars a year intoone of these things and pretty you know,
(30:02):
pretty significant difference there between what you'reallowed to do. So I've been
saying for years that I think thesetwo things should be even. You know,
whatever you can contribute to a fouroh one K, you should be
able to contribute to an IRA onyour own. I think probably the reason
that's not the case is because companiesthat service four oh one K plans make
a whole bunch of money and theydon't want to see iras replace that.
(30:23):
I totally agree. I have anew leader in the clubhouse Michael for the
most tone deaf article of twenty twentyfour, really it's a doozy hit me.
It's from the Wall Street Journal yesterday. They love their fourteen point nine
to five million dollar Hampton's house.The problem, the dog hates it.
(30:48):
Shortly after, who is writing?Who is this targeted towards? Sorry,
I don't know. Like the factthat this actually even got written is remarkable
to me, because it's it's it'sit's fantastic. Shortly after, Brian Grebil
and Daniel Docos moved into their dreamhome in sag Harbor, New York,
the couple realized they had a problem. Their beloved COVID dog, a redheaded
(31:08):
golden dudal named Rufus, didn't likethe house. He was sort of poudy,
said Gray Bill, who said theygot Rufus from a dog breeder in
Montecito, California, where they wroteout the pandemic. So already you've got
just some some wild stuff, like, okay, five thousand dollars dog waiting
out the pandemic in California, Mike, this dog is probably twenty thousand dollars.
(31:30):
Yeah, okay, like you can't. You can't breed dogs in California
for five grand a pop. Yeah, yeah, that's fair, you know,
like, how are you gonna affordthat other thing? How are you
gonna flor Moto summer home on fivethousand dollars a dog. I'm slightly ashamed
to admit that we've become those peoplemaking life decisions around our dog, said
(31:51):
grey Bill. And yet he said, he is the joy of our life.
Now, like this would be enough, but then like you actually read
through like some of the other stuff, and it gets even better. Let
me find the one quota. Herewe go. With approval from local officials,
Grabel and Doco substantially renovated the nineteenfifties home, building a roughly forty
two hundred square foot house with fivebedrooms in its footprint. Lovely, Okay,
(32:15):
you can single one of those roomsof the dog and sit in.
Despite being smaller than their East Hamptonhome, which is about sixty five hundred
square feet, like they have twoHampton's homes, the house in sag Harbor
felt intimate had all the amenities theywanted, including a pool, pool,
bar, and an office that lookswest over the cove and north over a
Martian bird sanctuary. There's no backyard, though, look at this place,
(32:38):
it's a half acre. They spentabout eight million dollars on construction, landscaping,
and hard and soft cost gray Billsaid, I thought it would be
our forever home, so I reallyleaned into everything being custom. He said
they went a little indulgent on interiorfinishure finishes like light fixtures, paint,
plaster, and kitchen appliance. Andthe windows were made in Charleston, South
(33:00):
Carolina by a company specializing in historicwindows. Oh good, what is the
point of this article? I don'tknow, like every sort of human interest
piece that nobody can relate because that'slike I'm waiting for the kicker, like,
oh yeah, and construction costs arereally high, or financing is going
to be a pain because now wehave to go get a mortgage elsewhere and
(33:20):
making it a story about interest rates, Mike, But there's just there's no
there there. It feels like theypaid the Wall Street Journal to write this
so they could get money for theirhome. It's it's like it's it's almost
like a paid advertisement. It feelsyeah, where's the go fundme? Crapel
says when they moved to sag Harbor, Rufus's joyful demeanor changed. They took
him to many nearby beaches, butthey were narrow and rocky. The dog
(33:42):
was constrained and he couldn't run asfast as far as he could in California.
He couldn't dig Crapel says. Heand Doco thought Rufus would acclimate until
they drove to East Hampton one dayand the dog was back in his element,
the smile on his face. Ifdogs could smile, he said,
The dog is definitely happier in EastHampton. Trust does they all so have
a home in New York City aswell? How does this piece get published?
(34:06):
The comment sections turned off by theway, Ah, come on,
I can imagine why. Yes,of course you can. And this brings
me back to my conclusion. Fed'sgot a hike. Unhappy dogs, Ben's
got a hike. Oh, we'rehaving to sell our fifteen million dollar Hampton's
second Hampton's house because you know,the first one wasn't enough. Bloomberg and
(34:30):
and whilst your journal are are justin this ridiculous competition to see how narrow
of an audience they can target.Unbelievable. So that's the point of this.
Yeah, I just I can't reallyfigure out what's going on here,
But man, I feel kind ofbad for them that they publish this.
(34:51):
Actually, dear God, edit somethingdown, folks. But uh yeah,
so there's that fed's got a hike. Markets remain in positive territory. The
downs up two to fourteen s andP up twenty one, Nazda c up
sixty three. We're done for theday. Back at it tomorrow to finish
up the week.
The Financial Exchange is produced by MoneyMatters Radio and is hosted by employees of
the Armstrong Advisory Group, a registeredinvestment advisor that provides investment advisory services.
All opinions expressed are solely those ofthe hosts, do not reflect the opinions
of Armstrong Advisory or anyone else,and do not guarantee profit. Investments can
lose money. This program does notoffer any specific financial or investment advice.
(00:20):
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the Financial Exchange with Chuck Zada andMike Armstrong. A little bit after eleven
here on the Financial Exchange, we'vegot markets attempting to stage a rally.
Yes, that's right, we're seeingsome green on the board after what has
(01:23):
been tough five days we've been it'sbeen six days. We haven't had a
day in positive territory since April eleventhon the S and P five hundred.
In fact, in some areas ofthe market it's been worse than that.
Boeing Actually, if up today,it would be only boeing second day of
gains for the entire month of April. Other than that, every other day
(01:48):
has been down for Boeing this month. A lot of Charlie Brown moments to
this last few weeks where markets arelooking our right to start the day and
then boom, the football gets pulledout from Mondy. It's been price action
that's really reminiscent to me of Septembertwenty twenty one, which was a really
similar setup. Not in terms ofthe overall you know, economic situation was
(02:12):
very different back then, but itwas just you know, a couple weeks
in a row of it just feltworse than it was because the market would
open up half a percent or twothirds of a percent and by the end
of the day closed down half apercent, and so you just felt like
you were getting whacked like one toone and a half percent each day.
And then you'd look up and you'relike, oh, markets are down like
five or six percent. It wasn'tactually that bad. This is kind of
(02:36):
similar where it's like, hey,you've got you know, these markets that
keep opening up in positive territory,and it's like, oh, this is
awful, and then you actually lookat the scoreboard and you go, well,
the S and P five hundreds downfour percent from its high. It's
not that bad. Yep. Obviously, look if you're trading, you know,
intra day and with leverage and thingslike that, it can be much
worse than that. But I'm guessingmost of our listeners aren't doing that because
(03:00):
most people aren't doing that. Speakingof things that most people aren't doing,
Amazon, according to a Wall StreetJournal exclusive, I'll quote here, this
is actually I'm I'm trying to figureout what percentage I should be disgusted by
this and what percentage should be youknow, kind of admiration because it's a
(03:24):
little bit of both. Quite honestly, for nearly a decade, workers in
a warehouse in Seattle's Denny Triangle neighborhoodof ship box of shoes, beach chairs,
marvel t shirts and other items toonline retail customers across the US.
The operation called Big River Services International, says around a million dollars a year
of goods through e commerce marketplaces likeeBay, Shopify, Walmart, and Amazon
(03:46):
under the brand names such as RapidCascade and Spa Bliss. We're entrepreneurs,
thinkers, marketers, and creators.Big River says on its website, we
have a passion for customers and aren'tafraid to experiment with The website does say
is that Big River is an armof Amazon that surreptitiously gathers intelligence on the
tech giants competitors. So these areall Amazon employees who, under direction of
(04:12):
Amazon Corporate, started this separate companyand the entirety for its existence is to
gather data on its competition. Andthere are apparently troves of documents from corporate
attorneys at Amazon. This is acode named Project Curiosity. By the way,
why do they have to always havecode names. I don't know,
(04:35):
well, because if it was ProjectBig River Services International, then it would
get out pretty quickly, I guess. But it already did get out,
Yeah, I did, but ittook a decade. You know, advice
or you counsel from attorneys there saying, you know, make sure you don't
bring this up on corporate earnings callsor you know, disclosed to other employees
(04:55):
of what you are doing. Don'tmake it public to you know, the
competit what you are doing here,et cetera, et cetera. So what
sort of information might you be ableto get if you are a seller at
eBay and Walmart as well as atAmazon. I guess a whole lot of
price data and commission data on howthose other platforms are working. Well,
(05:16):
you're going to get that. You'regoing to get information about how their distribution
works and how they're shipping works.Yep, you're going to know how their
logistics network works, because you're goingto know you know, what goods need
to be in what warehouse at whattime in order for them to ship and
be delivered on time. You're goingto get information about how you're able to
negotiate with them and what things they'rewilling to negotiate on and what they aren't
(05:40):
probably information also just on the shippingaspect of it. Hey, who handles
this shipping and you know, what'sthe cost of that shipping? You know,
you'll be able to get that kindof information too. You'll be able
to understand how their discounting program maywork. Hey, you know what kinds
of discounts can we pass through?Who? You know, does the the
(06:00):
you know, the seller take thediscount or does Walmart eat it? Are
there ways to shift that? There'sall kinds of different information that you can
get most certainly, and apparently thefocus on this was on Walmart just because
it's the biggest retailer in the countryand so obviously they're more of a you
know, concern for Amazon than anyoneelse. But it's something where they were
(06:24):
just trying to gather as much dataas possible on how the operations of these
other companies worked, and they didall kinds of things to try to keep
it, you know, hidden.They would you know that they had full
big River you know email addresses aswell as Amazon ones, and they took
pains to make sure they were youknow, using the right communications through the
right ones. They always you know, presented themselves externally as big River employees
(06:47):
and things like that, and youknow, they spend a lot of time
and effort on trying to make itseem like they weren't in any way affiliated
with So I have a few questionsabout all of this that I genuinely don't
know the answer to. One.I would assume that this is probably a
(07:09):
violation of Walmart Ebays and all theseterms of service, right, I mean,
probably you are not supposed to dothis type of thing, and I
would imagine it's explained in the contractthat you signed with these companies when you
sign up. So yeah, potentiallyviolation of that. But does Amazon really
care. Probably not these worst casescenario, they kick them off the platform.
(07:30):
In terms of legality, I don'tknow that they've actually broken any laws
here. I'm not sure that therewould be any sort of disclosure requirement for
instance, consumers that you're buying fromAmazon and not, uh, you know,
the eventual ownership is an Amazon corporation. But I do think it comes
to if you're trying to bring acase against Amazon in the future about the
(07:56):
harm that you are doing to consumersas a monopoly. This is pretty good
evidence. There also is let's seehere. I don't know that it would
necessarily apply here. There is Innineteen ninety six, the Economic Espionage Act
(08:18):
was signed. I don't know ifit. I thought that mainly had to
do with foreign competitors spying on domesticcorporations. That's part of it. This
is there's other parts here that mightapply. I don't know, Like,
there's one part of the code.I'm not a lawyer on this stuff criminalize
(08:41):
the misappropriation of trade secrets related toor include a prank that's placed in interstate
commerce with a knowledge or intent thatthe misappropriation will injure the owner of trade
secret. Right, So maybe youcould say, okay, this won't injure
the owner necessary. I don't knowin any case. As I said at
the certainly distasteful. I go backand forth between it's it's probably unethical,
(09:05):
but not necessarily immoral, if thatmakes sense. Okay, you know it's
it's unethical because it it's not somethingthat you'd want to see businesses do it.
You're lying to customers like, yeah, this is this is unseemly.
It's it's unethical, like you're you'rebasically pretending to be someone that you're not.
(09:26):
Is it immoral? I'm not reallysure who was harmed by it,
Like it's you know, it's Idon't. I don't know that it's immoral.
So I kind of look at itand go, I probably wouldn't do
it myself if I were, youknow, starting a company like this.
But out of all the things Amazonhas done, I don't know that it's
(09:50):
the biggest concern of mine. It'sjust more like it just feels a little
icky, you know, or thatsome of their competitors have done, specifically
some of the ones that they werespying on here. I remember the story
of the Massachusetts couple who were writingabout eBay a few years ago. I
mean, these are not innocent groups. If you haven't read this honestly fascinating
(10:11):
story about how this couple in Massachusettswas writing what the reviews of eBay and
like a blog about the problems ateBay, and corporate leadership at eBay literally
took dramatic steps to intimidate them outof doing so very very illegal steps that
I think ended up sinking some ofthe executive team there, basically sicking their
(10:35):
private security on these people. Fascinatingstory of different types of in my mind,
much worse moral conundrums, but thisone. Like I said, I
think the one thing that I goback to on this is if you're trying
to make a case that Amazon isanti competitive, it's been really tough to
make that case based on harming consumers, and I don't think that this necessarily
(10:58):
changes. But if you're trying tomake an argument that no other company can
really compete with them because of thedramatic steps that they take across their business
model, this is another piece ofevidence because I'm sure that retail isn't the
only place that they're doing this right. They certainly have companies embedded in social
media advertising, companies like Facebook,they have you know, all sorts of
(11:20):
I'm sure that this is a practicethat they employ in other areas of their
business, because retail isn't even themost profitable version of this. Let's be
honest, this is you know,a Wall Street journal piece that's on Amazon.
Would you be in any way surprisedif Walmart was doing this, I
would be surprised if they're not doingit right. It's and this is why
(11:43):
I say, Look, it's it'sprobably like kind of unethical, but I'm
not sure that it's inherently immoral.I I just have seen far worse things,
as you mentioned. It's I andmaybe that's just I'm too hated by
this at this point that it's like, oh, like, there's so much
worse that goes on. But yeah, you're judging, you're judging on a
(12:03):
pretty rough scale. Yeah, I'llgo back to you. I'm not going
to judge the morality or ethical partof it. It doesn't seem to be
illegal from what I can tell.And part of it also is Look,
part of the reason why these youknow, different companies are so profitable and
why it's so hard to break inis because a lot of this stuff is
(12:26):
just automated on the back end.If there were anyone at Walmart who was,
you know, manually reviewing storefront applicationsfor companies on them, they might
have been like, Hey, thisdoesn't look right, maybe we shouldn't let
them do this. Just putting thatout there as well. The Financial Exchange
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(12:48):
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(13:11):
This is the Financial Exchange Radio Network. Americans are getting sick of point zero
one percent yields at big banks,So I'll quote here across JP Morgan Chase
is broad suite of customer accounts.One number is just about everywhere point zero
one percent. That's the interest rate, and Chase Sapphire, Chase Premiere Plus
(13:31):
and Chase Private Client checking accounts regardlessof someone has deposits of five dollars or
five hundred thousand dollars. So ittalks about how big banks for the last
you know, year or two havereally been able to continue to pay out
next to nothing on customer deposits.Can we can? We also cover the
savings account. The special savings accountgets you a w the interest rate to
(13:54):
point zero two percent. It's twiceas high. I mean, did it
used to be? Did it usedto be? So dramatically different in terms
of interest rates when you went fromChase to I don't know, New York
Community Bank Corp. I guess iswhere I'll go with this one. Like
(14:16):
it's just mind blowing. Here's thething. The big reason why this is
the case is that Chase doesn't wantmore deposits right now. If Chase actually
wanted more deposits, they have higherrates. But Chase has too many deposits.
I know that sounds kind of weird, but here's the basic math of
(14:37):
it. Let's say that you haveone hundred billion dollars in deposits and you've
got ninety nine billion dollars in loans. You're saying, hey, I want
to make you know, another billiondollars in loans to get everything matching up.
If you don't have good loans tounderwrite, then you're not going to
pay more in order to get moredeposits so that you can do that.
(15:00):
Like it's just you don't need themoney. So you say, no,
we're gonna pay less on deposits becauseif some deposits go away, that's that's
quite okay. It's it's absolutely fine. This is what Chase and other big
banks are doing right now because theydon't have enough good loans to make.
On the other hand, when youtalk about your small banks, the ones
that might be offering you know,four percent savings, five percent savings,
(15:24):
things like that, a lot ofthose might have in the last year because
of concerns about bank stability after SiliconValley Bank collapsed. They might be chasing
deposits because they've got a bunch ofloans and they're like, no, we
need some more deposits in order tokind of shore things up here and make
sure that we can, you know, continue to make the loans that we
want. You might have banks chasingafter deposits in order to you know,
(15:46):
basically be able to make the loansthat they want to make at this point
and to not be up against itfrom coverage ratio perspective. So I think
that when we look at this andyou know, ask hey, why is
JP Morgan Chase not paying anything ininterest, It's not because they hate you,
like they they don't care about youeither way. It's like you're it's
(16:10):
you, yes, they it's it'sit's the classic Don Draper, I don't
think about you at all. Likethat's that's what Chase is basically saying.
They they don't think about you.If they wanted more deposits there, they
would have higher deposit rates. Butthey've basically said, and they said this
in earnings filings last year, Hey, we we don't have enough good loans
(16:32):
to make, so we're not gonnachase after deposits right now. I do
find it interesting that both JP MorganChase and Bank of America. I don't
know Bank of America's numbers, butJP Morgan Chase intending to open five hundred
new branches by twenty twenty seven.Maybe that's just what the express intention,
being able to make loans in thecommunity. But on the surface, right
like, the reason you open branchesis finding new deposits at a time when
(16:55):
they don't really need them very much. So yeah, interesting to do.
What a good question. But thereare areas of the country apparently where they
do not yet have that exposure,Boston being one of those. By the
way, bringing the latest financial newsstraight to your radio every day, it's
(17:23):
the Financial Exchange on the Financial ExchangeRadio network. The Financial Exchange is now
available on your Alexis smart speaker.Has to play the Financial Exchange and catch
up on anything you might have missed. This is the Financial Exchange Radio network,
Mike, Are there too many passiveinvestors? People have brought this up
(17:45):
over time, you know, sinceI think the active managed mutual funds started
getting threatened from the likes of Vanguard, people have started asking, well,
what if everyone just sits back andpassively invests at some point? Doesn't that
create a danger to the stock marketor maybe an opportunity for active managers to
outperform their counterparts their counterpoints. Andthis article does point out that the share
(18:11):
of money and passive funds was morethan fifty percent in January. That's up
from between thirty and forty percent backin twenty ten. So yes, the
use of passive index funds has increasedsubstantially. However, I think, as
this article attempts to point out,merely because you are invested in, say
(18:33):
a passively managed index fund from Vanguardas an example, does not mean that
you are being passive with the waythat you invest. And I think that's
a kind of tricky and important distinction. Yeah, And I think the other
thing that I always do like topoint out is when we talk about again,
all indices are different, but theS and P five hundred. Just
(18:56):
as an example, people you knowsay, oh, like, you just
have an index fund that's Standard andPoors actually has a set of criteria that
they use in order to decide whogets into the S and P five hundred,
and some of it does involve somejudgment. Actually, all you if
you are buying an S and Pfive hundred fund, you're actually buying a
(19:17):
fund that is actively managed by Standardand Poors. Is just not actively managed
the same way that you know aconventional mutual fund would be. So it's
it's something where even within what looksto be a passive investment, there's still
someone who's making decisions. It's it'sStandard and Poors. It's not just the
five hundred biggest companies in the US. They have standards for profitability, they
(19:38):
have standards for share price, likeall these different things, and it just
happens to be really hard to outperformthat benchmark. But ultimately, even the
S and P five hundred is activelymanaged, believe it or not. Likewise,
let's say I'm invested a bunch ofmy money in a passively managed index
of energy companies, and I decideto sell that and manage my money in
(20:00):
a passively managed index of technology companies. I have moved from passive to passive
investment, but I'm doing active.So no, I don't think this really
tells you much of anything. Icertainly don't think it's anything to be concerned
about. I think the biggest conclusionfrom this massive shift that has undergone over
the last couple of decades has beena dramatic saving for individual investors in terms
(20:26):
of how much money they've been ableto save on that overall transition from one
type of one type of investment toanother, because those passive, those passive
investments on buy and large are substantiallycheaper than what people were paying years ago
for the ways in which they invest. If this is sounds complicated, it's
(20:48):
frankly because it is. I knowthat there are plenty of people that do
exactly what the author is talking about, which is every month pour some money
into a passively managed index within theirfour oh one K and that that is
a fair bit more passive than whatwe are discussing here. But if you
are doing that today and you havequestions about how that may or may not
(21:11):
need to shift, the closer youget towards that date of what you're saving
for. This could be college,this could be buying a new home,
this could be the big one beingretirement. Then we frankly at the Armstrong
Advisory Group work with people every singleday to assess how that investment portfolio is
going to serve those needs and frequentlycome across folks that are doing it quite
(21:33):
well, and also frequently come acrossbig potential mistakes that are being made in
terms of how acid allocations are derived, how they are intentionally or not so
intentionally set up for what they aretrying to accomplish. So two big items
that want to make people aware of. One. We have a guide out
this month that's free all about preparingfor an upcoming retirement, and certainly how
(21:57):
you invest your money and how howmuch you need invested over that period of
time is a critical piece of thatoverall equation on how to prepare for that
upcoming retirement. You can get acopy of this guide by calling eight hundred
three nine three four zero zero one. Again it's our guide on preparing for
an upcoming retirement. But if youhave general questions as well, you can
(22:18):
go to our website to request theguide. You can call our office and
talk to a real, live humanbeing, but that phone number the website's
Armstrong Advisory dot Com. The phonenumber to request a copy of our brand
new guide for the month of Aprilon preparing for an upcoming retirement is eight
hundred three nine three four zero zeroone. The proceeding was paid for by
Armstrong Advisory Group, a registered investmentadvisor. Nothing in the ad or in
(22:42):
any Armstrong Guide a specific financial,legal or tax advice. Consult your own
financial, tax and estate planning advisorsbefore making any investment decisions. Armstrong make
contact you to offer investment advisory services, Mike. Yesterday, the IRS issued
guidance on inherited ir rays for thosewho inherited iras since twenty twenty and the
(23:04):
guidance once again says that if youhave inherited an IRA in the last four
years so twenty twenty, twenty twentyone, twenty twenty two, twenty twenty
three, and now I guess thefirst three and a half months of twenty
twenty four, they are waiving anypenalties on required minimum distributions that may be
(23:25):
required. In final guidance from theIRS expected to maybe be issued later this
year, but not sure If you'reconfused about what I just said, here's
here's what this means. This islike the laughingstock of the financial advice and
Oka. This is the Bobby Bonie. This is baseball. Fans know that
Bobby Bonia has a contract that Ithink he's still getting paid from the Mets
a million dollars every July First,even though he hasn't played in twenty years.
(23:48):
I think the last payment's coming upin like a year or two.
This is basically the Bobby Bonia contract. Where in twenty twenty, with the
original Secure Act, Congress change changedhow inherited iras were treated originally. Before
that, if you inherited an IRA, and to be honest, if you
inherited the IRA and still have it, this is how it operates. From
(24:11):
pre twenty twenty. You have totake a certain chunk of money out each
year, but you're not required toexhaust it in a fixed period of time.
Starting in twenty twenty, the IRSsays, hey, you've got to
take this money out in a tenyear period, okay, And then they
issued some additional guidance that, bythe way, you may have a required
minimum distribution still for each one ofthose ten years, but you also just
(24:33):
have to make sure it's done withinten years each of the four years since
that announcement. They have then waivedthe penalties for missing a required minimum distribution
on an inherited IRA that was inheritedafter twenty twenty, so nobody has any
idea what we're doing. They havesaid that later this year they are going
(24:56):
to issue the final rule on requiredminimum distributions from post twenty twenty inherited iras.
We'll see if we get there.It's just but again, I know
this sounds really dry for somebody thatis just listening right now, but this
is genuinely important and just also reallykind of funny at how just stereotypically embarrassing
(25:26):
this is for me. I arrestwell. I think the part that's tough
for me is just look like,we work in this business. We see
this stuff a lot, yep,and it still is something where every time
I see an inherited IRA, Ihave to go back and like look at
the rules to be like, Okay, let's make sure that this one is
set up, Like how does thisspecific one need to be done? Because
(25:48):
there are literally at this point,I believe it's either six or seven different
possible outcomes for how it can bedone, depending on the exact situation in
terms of, well, was itpre twenty nineteen or post twenty twenty,
you know, post twenty twenty.Is it someone who is a spouse,
is it a non spouse? Isthe non spouse less than ten years younger
(26:10):
than the person who passed away?I mean, it's like, it's just
very, very messy, and II'm trying to think of like a comparison
in maybe the sports world or justevery parts of everyday life that are as
confusing, complex and convoluted as thisis. Nothing's really coming to mind.
(26:32):
It reminds me another baseball one foryou. Okay, this is like how
a walk counts as a plate appearancebut not an at bat. I so
it affects your on base percentage,but nothing else. Have you seen the
movie Basketball with the guys who createdSouth Park. Yeah, there's a scene
there there where they're describing how theteams make the playoffs and the wild card
(26:55):
run, and it reminds me ofthat. Yeah, It's it's just it's
not something that has any common senseto it, and it would just be
easier if it's like Hey, retroactively, we're just gonna make it this for
everyone, and let's just make iteasy. It would be easier to do
(27:15):
that. The reason they did allthis, by the way, is because
they need to create some tax revenue, which now they have failed to do
so well. I guess this't hasn'treally changed, but the idea was,
hey, we need to create sometax revenues, so let's penalize the beneficiaries
rather than penalizing the people who arecreating these higher rays. Let's take a
quick break and when we come back, we'll do a little bit of stack
(27:36):
Roulette. Missed one of our shows. Catch up anytime by asking your Alexis
Smart speaker to play the Financial Exchange. This is the Financial Exchange Radio Network.
Find daily interviews and full shows ofthe Financial Exchange on our YouTube page.
Like us on YouTube and get caughtup on anything and everything you might
have missed. This is the FinancialExchange Radio Network. All right, Mike
(28:04):
starts off, What do you gotfor stack Roulette? Some new programs around
New England on trying to boost retirementsavings, which we'll see how they turn
out. But I generally like thedirection this is going. Connecticut Maine to
name a few of these. Vermonthas launched a similar effort as well.
But here's the basic premise. Ifyou have a certain number of employees as
(28:26):
a small business five or more inthe case of Connecticut, you're now required
to offer a retirement program. Youcan do one of two things. Set
up a traditional plan like a fouroh one K or use this new no
cost state program, meaning the employerdoesn't face any costs to roll this out,
the employees might still face costs.Mains program, for example, is
(28:48):
the Merit Saves program. In January, some five hundred and forty businesses have
signed up so far, and thebasic premise is, hey, employer,
you're not gonna have to pay forthis, but you must sign up your
employees for this program that allows themto make contributions to their own retirement plans.
There won't be any matching contributions,but there's some automatic enrollment features,
(29:11):
there's some automatic increase features. Thebiggest downside to this is because they are
not from what I've been able totell, at least so far, because
they are not specific for h oneK plans and they're not you know,
they're not federal thrift savings plans oranything along those lines. They are basically
just IRAS problem with iras very lowcontribution limits. So this does not get
(29:37):
around one of those big problems andone of those big I think just conflicts
that's out there, which has alwaysbeen that, hey, if my employer
is willing to start before one K, for me, I can save tens
of thousands of dollars a year andsave on taxes. But if they don't,
then the IRS basically tells me Ican put away you know, six
or seven thousand dollars a year intoone of these things and pretty you know,
(30:02):
pretty significant difference there between what you'reallowed to do. So I've been
saying for years that I think thesetwo things should be even. You know,
whatever you can contribute to a fouroh one K, you should be
able to contribute to an IRA onyour own. I think probably the reason
that's not the case is because companiesthat service four oh one K plans make
a whole bunch of money and theydon't want to see iras replace that.
(30:23):
I totally agree. I have anew leader in the clubhouse Michael for the
most tone deaf article of twenty twentyfour, really it's a doozy hit me.
It's from the Wall Street Journal yesterday. They love their fourteen point nine
to five million dollar Hampton's house.The problem, the dog hates it.
(30:48):
Shortly after, who is writing?Who is this targeted towards? Sorry,
I don't know. Like the factthat this actually even got written is remarkable
to me, because it's it's it'sit's fantastic. Shortly after, Brian Grebil
and Daniel Docos moved into their dreamhome in sag Harbor, New York,
the couple realized they had a problem. Their beloved COVID dog, a redheaded
(31:08):
golden dudal named Rufus, didn't likethe house. He was sort of poudy,
said Gray Bill, who said theygot Rufus from a dog breeder in
Montecito, California, where they wroteout the pandemic. So already you've got
just some some wild stuff, like, okay, five thousand dollars dog waiting
out the pandemic in California, Mike, this dog is probably twenty thousand dollars.
(31:30):
Yeah, okay, like you can't. You can't breed dogs in California
for five grand a pop. Yeah, yeah, that's fair, you know,
like, how are you gonna affordthat other thing? How are you
gonna flor Moto summer home on fivethousand dollars a dog. I'm slightly ashamed
to admit that we've become those peoplemaking life decisions around our dog, said
(31:51):
grey Bill. And yet he said, he is the joy of our life.
Now, like this would be enough, but then like you actually read
through like some of the other stuff, and it gets even better. Let
me find the one quota. Herewe go. With approval from local officials,
Grabel and Doco substantially renovated the nineteenfifties home, building a roughly forty
two hundred square foot house with fivebedrooms in its footprint. Lovely, Okay,
(32:15):
you can single one of those roomsof the dog and sit in.
Despite being smaller than their East Hamptonhome, which is about sixty five hundred
square feet, like they have twoHampton's homes, the house in sag Harbor
felt intimate had all the amenities theywanted, including a pool, pool,
bar, and an office that lookswest over the cove and north over a
Martian bird sanctuary. There's no backyard, though, look at this place,
(32:38):
it's a half acre. They spentabout eight million dollars on construction, landscaping,
and hard and soft cost gray Billsaid, I thought it would be
our forever home, so I reallyleaned into everything being custom. He said
they went a little indulgent on interiorfinishure finishes like light fixtures, paint,
plaster, and kitchen appliance. Andthe windows were made in Charleston, South
(33:00):
Carolina by a company specializing in historicwindows. Oh good, what is the
point of this article? I don'tknow, like every sort of human interest
piece that nobody can relate because that'slike I'm waiting for the kicker, like,
oh yeah, and construction costs arereally high, or financing is going
to be a pain because now wehave to go get a mortgage elsewhere and
(33:20):
making it a story about interest rates, Mike, But there's just there's no
there there. It feels like theypaid the Wall Street Journal to write this
so they could get money for theirhome. It's it's like it's it's almost
like a paid advertisement. It feelsyeah, where's the go fundme? Crapel
says when they moved to sag Harbor, Rufus's joyful demeanor changed. They took
him to many nearby beaches, butthey were narrow and rocky. The dog
(33:42):
was constrained and he couldn't run asfast as far as he could in California.
He couldn't dig Crapel says. Heand Doco thought Rufus would acclimate until
they drove to East Hampton one dayand the dog was back in his element,
the smile on his face. Ifdogs could smile, he said,
The dog is definitely happier in EastHampton. Trust does they all so have
a home in New York City aswell? How does this piece get published?
(34:06):
The comment sections turned off by theway, Ah, come on,
I can imagine why. Yes,of course you can. And this brings
me back to my conclusion. Fed'sgot a hike. Unhappy dogs, Ben's
got a hike. Oh, we'rehaving to sell our fifteen million dollar Hampton's
second Hampton's house because you know,the first one wasn't enough. Bloomberg and
(34:30):
and whilst your journal are are justin this ridiculous competition to see how narrow
of an audience they can target.Unbelievable. So that's the point of this.
Yeah, I just I can't reallyfigure out what's going on here,
But man, I feel kind ofbad for them that they publish this.
(34:51):
Actually, dear God, edit somethingdown, folks. But uh yeah,
so there's that fed's got a hike. Markets remain in positive territory. The
downs up two to fourteen s andP up twenty one, Nazda c up
sixty three. We're done for theday. Back at it tomorrow to finish
up the week.
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