August 6, 2024 • 34 mins
Mike Armstrong and Marc Fandetti discuss why Google lost its antitrust suit and what it means for the future of the company. Uber says consumer spending 'never been stronger' as profits jump. What to do with your money if you're worried about the market. How going to the movies is changing.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Financial Exchanges produced by Money Matters Radio and is
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(00:21):
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(00:42):
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(01:04):
by Veterans Development Corporation to Face is the Financial Exchange
with Mike Armstrong and Mark Vandetti.
Speaker 2 (01:12):
Good morning, Welcome back to the Financial Exchange. Equity markets
in the US are in rally mo actually kind of
broadly across the board. I think the Japanese Nik rose
the most since two thousand and eight this morning or
today in trading.
Speaker 3 (01:26):
But US equities up broadly.
Speaker 2 (01:29):
With the Dow of five hundred points one point three percent,
we're raising about half the losses from yesterday. SMP up
eighty seven points one point six to seven percent, NASDAK
about the same in percentage terms, two hundred and seventy points.
Speaker 3 (01:41):
At this point.
Speaker 2 (01:42):
The SMP five hundred off about seven percent now from
its all time highs, after being down about eight and
a half percent from those all time highs yesterday. We
had equity markets broadly down. I think the Nasdaq at
one point was off more than five percent yesterday before
rallying a bit mid day, but again closing broadly down
(02:02):
across the board. And then the interesting piece I think
to keep an eye on has to do with yields.
So in terms of the ten year treasury, now you
have yields moving up a little bit here today, but
sitting at about three point eight six percent on that
ten year yield. And again as opposed to the Fed
funds rate, which just fluctuates by the Federal Reserve, this
(02:25):
is a market driven rate that also ties in a
lot to say. Mortgage rates and everything along those lines
was as high back in April of this year as
four point seven percent, so a substantial drop on the
ten year yield.
Speaker 3 (02:37):
According to Mortgage News Daily.
Speaker 2 (02:39):
Now the average yield average thirty year mortgage rate as
of today this is six point three four percent on
that thirty year fix thirty year jumbo, more like six
point six one percent. So something to continue to monitor here.
And I suppose one of the silver linings of an
economic slow down is those lower rates should they come
to pass.
Speaker 4 (02:59):
I think this confirms the technical explanation as the trigger
what we were calling last hour the proximate cause of
the sell off of the past couple of days. Friday
and yesterday we talked about sophisticated investors who borrow in
low yielding currencies. They buy high yielding currencies that works
until it doesn't, and when it doesn't they have to
sell stuff. And then computer programs that do trading require
(03:20):
that other investors sell stuff. It cascades throughout the globe
and you get these massive, seemingly uncontrolled and not a
left field sell offs, not because of any immediate economic trigger,
even though there were worries about a week labor market
resulting from last week's unemployment report, but resulting from technical
factors and a quick bounce back though we haven't recovered
all of yesterday's losses, but a relatively quick rebound. It
(03:43):
confirms the explanation of what the immediate cause or trigger was.
Not to say there might not be more volatility in
our future. We know volatility tends to bunch up and
perpetuates itself, so we're on the lookout right.
Speaker 2 (03:56):
The longer term, I think volatility that is reasonable to
be concerned about is just the state of the United
States economy. It is slowed enough to get inflation closer
to the Fed's preferred target, and it has by and
large done so because of higher interest rates and a
general slow down in economic activity. Right we've seen the
(04:17):
unemployment rate now climb from three to five to four
to three.
Speaker 3 (04:20):
Nothing that you haven't had, I think so.
Speaker 4 (04:21):
But GDP is still pretty hot.
Speaker 3 (04:23):
GDP is still pretty high. Manufacturing is really slow.
Speaker 4 (04:26):
Positive energy shocks. That's what I always That's what bothers
me a little bit about the triumphalist talk with respect
to inflation. Hey, it's back to two ish percent. It
never levels out at two percent obviously price, but it's
back to being in the background of the point where
you don't have to factor it into your calculations. That's like,
that's a great definition. A low and stable comes from
Builton Friedman. Nobody thinks about it. That's my definition a
low and stable. What if we're only there because energies
(04:48):
come in a lot, right, this is why the FED
hasn't cut yet. They're not sure, and they're they're probably right.
History suggests to be not sure.
Speaker 2 (04:55):
Yeah, So here's where it is long, longer term concerned
that I would have, and I think Man, you have
about the markets and the economy doesn't have much to
do with Japanese trading and borrowing in these complex trading algorithms.
That's not going to be the root cause of a
recession and downturn. The root cause of it would be
a recession that comes out higher unemployment, companies feeling squeezed
(05:17):
in terms of their margins, laying off employees and then
a broad slow down in economic activity, and unfortunately that
type of broad slow down in economic activity which needs
to be orchestrayed to get inflation under control. Whether it's
a recession or whether it's a soft landing, those things
look pretty similar in the early stage.
Speaker 4 (05:35):
Every market downturn, every economic downturn, whether just to slow
down a recession, it's a murder mystery. We know the victim,
we know the proximate cause was Colonel Mustard got it
with a candlestick in a library. For those of you
who know, are like, I'm not a big fan of clue,
but I remember that. But what you don't know is
that really interesting stuff, why and when and was it avoidable?
(05:58):
Economists are still are about the causes for a great depression.
I kid you not, we haven't figured that. I'm not
I don't do that kind of research, But they haven't
figured that out. You never really know. So if we
don't know what happened ninety yeah, I just call it
one hundred years ago. With all this great data and
all these great tools, you think we're gonna be able
to tell you when a recession's coming.
Speaker 2 (06:17):
Probably not, Probably not. Nobody can big announcement yesterday in
terms of Google. So Justice Department, for I think about
a year now has been suing Google in court over
monopolist charges and and to trust charges, and a judge
yesterday found them guilty. Google quote from the from the
(06:39):
ruling from the the federal judge meta here m h
e hta, which is kind of confusing because one of
Google's can pick competitors is meta, but the judge's name
meta quote. Google is a monopolist and it has acted
as one to maintain its monopoly. So whether or not
you agree with the ruling, mark, well, what's the premise
(07:01):
of this? Where where does the antitrust claim come from?
Speaker 1 (07:04):
Here?
Speaker 3 (07:05):
In terms of Google's dominance.
Speaker 4 (07:07):
I understand it if you define the relevant market narrowly
enough as searching they which they've done effectively to the
federal government's credit. I guess in this case, if you're
on their side, you can get the charges to stick.
And a judge agreed you can't monopolize to the extent
that it could hurt consumers, although I don't think they're
(07:29):
using the consumer harm definition here. This is where I
get way out of my league and start to confuse
myself but yeah, Mike, they did a good The prosecutors
did a good job defining the relevant market getting a
judge to buy into that definition and find Google almost
by definition, guilty of monopolizing a market that they created.
Speaker 2 (07:46):
So the market that they are describing here is search,
So online search and the advertising that gets sold attached
to it, that is the market they may have defined.
It's not hardware, it's not technology generally, it is online
search and the advertising revenue that from which you derive
income from that online search. And I think if you're
(08:08):
able to define the market that way, it's clear that
Google has dominance. Right, they made up what was it,
ninety percent of searches across the United States occur on
Google's platform. And then likewise, if you're willing to define
the market as such, then it is pretty clear that
Google has acted monopolistically to harm competition at least and
(08:31):
provide massive barriers of entry.
Speaker 3 (08:33):
How do they do that? Well, they pay Apple.
Speaker 2 (08:35):
In twenty twenty two, I think it was twenty billion
dollars to make Google the default search engine on all
Apple devices and Safari web browsers. So if you're looking
for beyond, it's not good enough to just say, oh,
they've been dominant, you also have to go and prove
what sort of behavior has occurred to make them as
(08:55):
dominant as they are. And that was the evidence that
I think the Justice Department delivered quite well in this case, was, Hey,
not only do they have this dominance, and yes, part
of it might be because they are the best search
and engine out there, but they also prevented anybody else
from getting any dominance here because they made themselves, through
(09:15):
these payments, the dominant search engine on pretty much every
device out there that people use two search things.
Speaker 3 (09:21):
Whether that's Safari or Firefox or any of these other
programs that are out there.
Speaker 2 (09:30):
I think the counter argument here, Mark would be it
is pretty tough to come up with who which consumers
were harmed by this.
Speaker 4 (09:37):
Apparently that wasn't the standard that that the judge agreed
should be applied in this case. An appeals court judge
might decide differently.
Speaker 2 (09:46):
Right, because it is tough for me to sit here
and say, Okay, if I think back over the last
decade of you know, how many searches that I have
played out on Google, I hesitate to come up with
how would I have been better off We're Google not
the default on my web browser. We're Google not baked
(10:07):
into the device that I bought. Automatically, It's never the
default on mine.
Speaker 4 (10:10):
I'm always switching over to Google Chrome, you like on
my iPhone, on my Windows laptop.
Speaker 2 (10:16):
Yeah, you're right, I don't want it, no offense, but
I think if you just open a Safari browser and
type in a search, it is going to default.
Speaker 4 (10:26):
Google search engine. Forgive me right.
Speaker 2 (10:28):
It's not just the web browser. We're talking about the
search engine that's utilized on those browsers. And so it
is tough for me to come up with that consumer harm.
And so this is going to be appealed. Obviously, Google's
going to fight this to the nail because they want
that dominance. It's also really unclear that the other part
that hasn't been spelled out here is what are the remedies.
Speaker 4 (10:48):
What is going to be breaking out in a search business.
Speaker 3 (10:50):
That's what they did, perhaps that's what they did to Microsoft.
Speaker 2 (10:53):
Other things have been said like, okay, you can still
be part of Google's parent company out, but you can't
pay for that default position on web browsers and Apple
devices and et cetera, et cetera.
Speaker 3 (11:07):
And the consumer is going to get to choose it.
Speaker 4 (11:09):
I mean, maybe it's weighing on the stock today. I
was going to brush it off and sayes stock's basically unchanged. Yeah,
but the Tech index in the S and P, the
industry group Tech is up two percent. So it is
apparently should Google chance they have to divest themselves in
this business?
Speaker 3 (11:24):
Right?
Speaker 2 (11:25):
This is a massive portion of Google's revenue, right, Like
search engine advertising revenue is huge.
Speaker 3 (11:32):
It is massive.
Speaker 2 (11:33):
It is how Google built themselves and all the ancillary
businesses that now make some money for them all came
from this dominance.
Speaker 4 (11:40):
Eighty five percent of revenues from online ads.
Speaker 3 (11:44):
Yeah, there you go.
Speaker 2 (11:46):
So it's also unclear to me how you would break
this out, right, Like, if it's the market dominance, then
you would want to somehow break up that Google Search,
not only break it apart from the rest of Google,
but break it up somehow. And I don't That doesn't
make any sense to me, Like, is the Google Search
that I do in the Northeast going to be owned
by a different company than when I travel to Phoenix,
Arizona and Google Search, I don't think.
Speaker 3 (12:06):
So, We're not likely to have that type of breakup.
Speaker 4 (12:09):
Janitor, the people to take care of the plants, and
somebody in accounting.
Speaker 2 (12:14):
YouTube still if you know Gmail YouTube, These are all
other business units of Google, but you're right, they are
nothing in compared to Search and so yeah, the consumer
harm piece, that is a big question to me. I
don't know where this goes long term. How it gets
broken up in some way, shape or form is another
big question. But here's what I will acknowledge. The Justice
(12:35):
Department under Biden and Lena Khan have been pushing, pushing,
pushing on anti trust cases. This is their first and
only win. And I might disagree with some of the
conclusions that the judge made, but they're going to hang
their hat on this as Hey, we might have failed
in these other cases, but this is the first large
ruling again against the tech company on anti trust concerns
(12:59):
since Microsoft, and that's worth noting, whether you agree.
Speaker 3 (13:02):
With it or not.
Speaker 1 (13:03):
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Speaker 2 (13:26):
Uber reported earnings before the bell this morning. Stock is
up big in trading early on seven and a half percent.
What we heard from Uber was a relatively healthy quarter.
And again I find that interesting, not because anybody builds
recession models on Uber's earnings, but much of their business
is a very discretionary type of business.
Speaker 3 (13:48):
Right.
Speaker 2 (13:48):
It's ordering food that you get then delivered directly to
your door. It's pretty discretionary in nature.
Speaker 3 (13:56):
Right.
Speaker 2 (13:57):
This is not grocery store sales. It's not sales of gasoline.
Revenue grew sixteen percent year on year to ten point
seven billion dollars, which was just a head of analyst
forecast of ten points six billion dollars. They saw sales
growth at both the ride healing and food delivery businesses,
and then net income of a billion dollars came in
well ahead of market expectations of only six hundred and
(14:19):
sixty million dollars in that second quarter. The CEO Dara
Dara Kazershawi, Right, I think that first name, yeah, quote,
the Uber consumer has never been stronger. What do you
make of that? Look, this is another one of those businesses.
We had a story yesterday about how twenty somethings were
(14:41):
throwing PowerPoint presentation parties, and I just I was the
first to say that I'm too far removed from that
stage of my life to understand what's going on here. Likewise,
I generally don't use Uber unless I'm traveling via an airport.
What's your take on such robust demand from consumers.
Speaker 3 (14:58):
Here on the Uber place mark?
Speaker 2 (15:00):
Does it in your mind you can coincide with any
other you know, data we've seen on the health of
the consumer.
Speaker 4 (15:06):
I don't know how much you can generalize from it.
I just don't clearly contradicts the slow down story that.
Speaker 2 (15:14):
Because right we've been hearing about that from like McDonald's
and all these companies saying, hey, we have to discount
our pricing because consumers are not spending money well. Uber
comes Orus over the past two weeks are massively year
over year because.
Speaker 4 (15:28):
Consumers could be specific to their clientele. I don't really know.
I'm looking at the stock price. It's still very expensive
relative to traditional mentionments. Revenue growth over the past year
has been reasonably strong, as it has over the past five,
but investors are expecting more so, can they make grocery deliveries,
can they adapt self driving technology? Can they take advantage
(15:49):
of their sort.
Speaker 3 (15:50):
Of first mover.
Speaker 4 (15:51):
Yeah, I might put myself in the skeptical category two,
But what the heck do I know?
Speaker 2 (15:55):
Quite honestly, I was skeptical that this company would ever
make money. Honestly, Like when they first came out, I
was really trying to figure out why on earth people
are going to pay three x what I would need
to pay to go get a McDonald's or to delivered
to my door. And I've been proven pretty consistently wrong. Likewise,
you know, trying to figure out how you're going to
pay a driver, plus you know, undercut cabbies by thirty percent,
(16:18):
and then also make Uber money was really confusing to me.
Speaker 3 (16:22):
At first. I really didn't see a market for it.
Speaker 2 (16:24):
But you know what, they've pretty successfully raised prices. I
don't know, Tucker, I mean, either of you. Have you
compared pricing on a cab versus an uber recently?
Speaker 3 (16:34):
Has anybody done that?
Speaker 2 (16:36):
I have a couple times coming from the airport, and
they're pretty on par these days. I still and oftentimes
prefer an uber because I can have the functionality I
can order it, I can see where I'm going, and
I know that the price quote that I'm getting ahead
of time. Like all of those things are much more
appealing to me. The taxis have finally started to adapt
(16:58):
and roll out some of that technology on their own,
but pricing is basically a parody. The company's making money
and for reasons that I have a tough time understanding.
Because last night's a good example. We wanted pizza as
a family.
Speaker 3 (17:12):
And I was.
Speaker 2 (17:14):
This makes me sound like just such a bad parent,
but like, hey, I'll go get the pizza. Please let
me get out of here for five hours, three hours,
sound like the dad that went out for ice cream
and never came back. But like, you know, the idea
of ordering food on Uber, which by the way, they
bump up the price on there and then you pay
for delivery on top of it. It just has never
(17:34):
had any appeal to me. But clearly it's got a
lot of appeal to a lot of people who are
still paying big dollars. And maybe that's the answer. Is
Uber's customers have a lot more money than McDonald's customers
and are continuing to come.
Speaker 1 (17:57):
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Speaker 2 (18:19):
We do this program five days a week most weeks
and try and explain a whole bunch of things. But ultimately,
I think why a lot of people tune in and
ask us questions is to try and figure out, well,
what the hell does it all mean for me? Sorry
to be a little bit blunt there, but like, what
should I be doing with all this information that is
(18:41):
constantly thrown at me from the Financial Exchange and Money
and CNBC and whatever program is on Bloomberg any day
the hour.
Speaker 3 (18:51):
What I don't know.
Speaker 2 (18:54):
Do you have a sense of or have you had
a guiding principle over your investment career of when you
think you should make any sort of change to your
investment portfolio based on something or another.
Speaker 4 (19:04):
Investment advisors are useful because they can protect you from
your own worst instincts. What do you hear over and
over from your investment advisor? It's stay the course if
your plan is right given your age and risk tolerance,
stay the course. Stocks have always been the most productive
or generative asset class. They've yielded the highest returns in
exchange for a lot of risk. That's why you get
those returns. But if you're a multi decade investor, if
(19:26):
you're a typical retirement investor, you should stay the course. Now,
our job on shows like this and as a firm
that in our day jobs provides investment advice is often
to explain and describe, but we don't try to predict.
Speaker 3 (19:40):
Give you a sense that that's important distinction.
Speaker 4 (19:42):
We understand, yeah, and sometimes we even fail at describing,
Like we talked about the kit right, Like we think
the so called carry trade buying in a cheap currency
investing in a currency with a higher rate of return.
We think that investors doing that in Japan were the
epicenter of the sell off of the past couple of days,
but we don't really know for sure. As I said
in a couple of segments ago, I think economists still
(20:04):
argue over the causes of the Great Recession, largely agreed
upon that it was in the mortgage market, But are
there are other candidates? Too, the Great Depression. You never
really know, so, but one thing we do on Mike
is that stocks have over meaningful time horizons twenty five
plus years, always for what it is worth. This is
just to use our fancy term egan empirical regularity. I'm
(20:25):
not making a prediction, but for what it is worth,
and this is all we have to go. And they've
always outperformed once, So a diversified portfolio of stocks is
always paid off for a long term investor short term investor.
Different story.
Speaker 2 (20:36):
There are some things that you know, the Journal has
a piece today about, you know, things that you can
be doing in a market like this if you're nervous
and trying to do something. Yeah, when markets are down,
Hypothetically roth conversions can make more sense when they're at
all time highs. There are tax loss harvesting things that
you can be doing. But to Mark's point, I think
very often during times that market downturns, the advice that
(20:59):
you here sent out there over and over is don't
change course, don't do anything. Here's the threshold for me,
and I've been thinking about this a lot over the
last week with the volatility that we've seen, is that
piece of advice I think oftentimes does hold true. And
the threshold in my mind is so long that as
(21:21):
you have planned for this type of downturn, right, like
we just talked about, we don't predict what's going to.
Speaker 4 (21:27):
Happen for a downturn.
Speaker 5 (21:29):
How would you here, Here's here's how I would I
would think about that is have I mapped out in
the event of a market downturn, what that's going to
mean for my investment portfolio.
Speaker 2 (21:41):
And the answer is there's no one size fits all,
because if you're a twenty five year old saving for retirement,
then the answer is you probably just completely and.
Speaker 3 (21:48):
You want those down because.
Speaker 2 (21:51):
You if you are not a twenty five year old
saving for retirement, and maybe you're already a retirement, then
it's about mapping out when you're going to need to
start living off of this or pulling it out, or
maybe you already are, and having a plan for where
that money is going to come from if it's not
going to be the stock market when it's in the
middle of a massive downturn, which we're not in right now.
(22:12):
Again important clarification, we're not there. And so that's my
threshold for hey, should I be thinking about making a
change to my investments, is have I actually thought about
this type of eventuality, because it is an eventuality. Unfortunately,
the best time to be planning all that is a
few weeks ago when markets were at all time highs.
But you know, that's the important distinction is if I'm
(22:33):
sitting here and yes, I've had this plan in place,
and I've thought about the repercussions of a market downturn
that could last five, six, seven years. Right, We've had
market downturns that from peak before the downturn to recovery
have taken I don't know what the longest one is
probably a deck.
Speaker 4 (22:48):
Twenty nine to fifty two great depression cheesz.
Speaker 3 (22:51):
Yeah, right, hopefully that's not.
Speaker 2 (22:55):
But you know it can take a significantly long time.
And so that's where that planning comes in. And that's
where that's the threshold that I would operates. If you
have not considered the possibility of a long, prolonged downturn
and how you would make ends meet in those events.
That's the reason to have a second look, to have
a second opinion, and to get.
Speaker 3 (23:16):
A good close look at what you are doing right now.
Speaker 2 (23:19):
Doesn't necessarily mean make a change because what you're doing
could coincidentally be right. But at least that's the threshold
for when you take a second hard look at what
you're doing today. If you could use some help in
taking that good hard look and evaluating what you're doing
today and how it may fit with your overall strategy,
I would encourage you to call the Armstrong Advisory Group
the phone numbers eight hundred three nine three four zero
(23:41):
zero one. But we have advisors located across New Englands
that sit with our own clients to really build a
concise and individualized plan for your future. If that is
not something you're getting today and you would like to
learn more again, call us at eight hundred three nine
three four zero zero one. That is the number for
(24:01):
the Armstrong Advisory Group free consultations again, whether it's you know,
across the country, across the world offices throughout New England
the number eight hundred three nine three for zero zero one.
Speaker 1 (24:13):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial tax into state planning advisors before making
any investment decisions. Armstrong may contact you to offer investment
advisory services.
Speaker 2 (24:29):
Markets remain pretty strongly in positive territory here. Dow has
fallen a little bit. Sow now up three hundred and
thirty points. That's down from an increase of about five
hundred points earlier. SMP now up one a third percent,
Nasdaq about the same, So again a slight weakening from
where we were earlier this morning. We will see where
things go later in trading. It remains a fairly light week.
(24:51):
Like we mentioned, in terms of big news, we have
some earnings coming in.
Speaker 3 (24:55):
We mentioned Uber.
Speaker 2 (24:56):
Caterpillar also reported earnings this morning and is up in
early t tomorrow. In terms of the earnings that we
will see, we're gonna have Nova, Nordisk, Walt Disney Company
reporting earnings, CVS Health, Shopify. Again, not that these are
insignificant companies, but when you had billion dollar plus companies
reporting all last week, they kind of.
Speaker 3 (25:17):
Don't really compare.
Speaker 2 (25:18):
Eli Lilly is a fairly big reporter coming out on
Thursday morning before the open, and then really until we
get to the next couple of weeks, that's when some
big economic data comes in. The data coming in this week, right,
we'll have weekly job as claims, as we do every week.
But the following week is when we get another reading
(25:39):
on CPI and a whole bunch more data on manufacturing
and import prices, etc.
Speaker 3 (25:44):
So a lot more to come here.
Speaker 2 (25:45):
But you know, in one sense that could be good
news to have a bit of a quiet period, But
in the other sense, you have these new recession concerns
and there's not much in the way of new data
that's going to come out to change that story of
the next few weeks. So that's I guess the forecast
that I would put out there is, Hey, we got
this Job's report on Friday that indicated a previously used
(26:07):
recession indicator. We will see what comes to place. But
there's not a whole lot coming out of the next
few weeks that would serve to steer things in a
different direction other than feeder board member speaking.
Speaker 4 (26:19):
Yeah, there are no indicators coincident other than the Salm rule,
which I think we dispensed with in the last hour.
Even Claudia Samas disavowed it to an extent. She's pointed
out that just because something's always happened doesn't mean it
will right These things tend to work. These regularities that
people observe tend to work until they don't, and then
people forget about them. Lousy predictors, but nothing else. Typical
measures of forward looking economic activity, so called leading indicators.
(26:43):
Some have slowed a bit, they've pointed downward, or their
rate of increase has slowed, but none are pointing toward recession.
I'm not saying that one is not around the corner.
Recessions aren't predictable. If someone tells you they are, that's
pretty much the hallmark of not knowing what you're talking about,
which is why we always.
Speaker 3 (26:58):
Try to slice them.
Speaker 4 (27:00):
Yeah, yeah, beware, Oh god, we haven't even gotten into
that angle of all the people clamoring for a FED
rate cut and how conflicted they are. They all run
money and they want their assets to go up. That's
why their crying sky is falling. Yeah, you can't be
too cynical when it comes to what you hear investment
managers calling for on Financial News.
Speaker 2 (27:18):
Let's take a quick break when we come back. Some
stack roulette on the Financial Exchange.
Speaker 1 (27:22):
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Speaker 6 (27:57):
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Speaker 2 (28:27):
Do you think we could do a new segment just
about whether a headline is from Florida or not?
Speaker 3 (28:34):
Yeah?
Speaker 4 (28:34):
I mean that just for spelling you should be able to.
Speaker 3 (28:38):
Well.
Speaker 2 (28:39):
So here's the headline, woman accused of stabbing worker in
head following fight at blank restaurant. What are you think
I'm not going to give you the name of the restaurant.
Speaker 3 (28:48):
Just where did it take place?
Speaker 1 (28:49):
Florida?
Speaker 3 (28:50):
No, Boston restaurant? Incorrect? You confused me? A woman is yeah,
Well that's the that's the game is. Did it happen
in Florida?
Speaker 2 (28:56):
Or did it not? And this time it did not.
Alicia Morassi, twenty nine, of Cambridge, was arranged Monday in
Boston Municipal Court on charges including assault with intent to murder.
So didn't occur in Florida.
Speaker 3 (29:07):
I like this game.
Speaker 2 (29:08):
I'm gonna I'm gonna start making most of my headlines
about this.
Speaker 3 (29:11):
Why are we talking about this? I don't know. Just
came up in my news feed. I figured i'd bring
it up. Gotcha? Uh how would if you had a choice? Right?
Speaker 2 (29:21):
Like movie is getting released both to theaters and streaming.
This has nothing to do with stabbing anyone in the head.
Speaker 3 (29:28):
I'm sorry, I have to I have to pivot here.
Speaker 2 (29:31):
Uh would you prefer to go to the theater and
experience a movie theater or would you prefer to watch
it at home? And has that view changed since COVID?
I'm asking the job Marblock here, Tucker, it can be you,
it can be Mark.
Speaker 6 (29:46):
I prefer I can't remember the last time I've been
in the theaters, so okay, clear, although I did make
a I did make a purchase for a ticket, and
then changes got played.
Speaker 3 (29:54):
I had, you know, changed up.
Speaker 6 (29:55):
I was supposed to go to Dune Too and in
the theater, and then I could make it.
Speaker 1 (30:00):
Yeah.
Speaker 2 (30:00):
I mean, there's been a few big hits that I
think I would have normally gone to see in the
theater recently that I haven't. Dune Too is one of them.
I saw saw it on an airplane instead. Deadpool Wolverine
is like again, typical comedy action movie that I would
consider seeing in the theater. Mark, you're just smirking at me.
No preference or definitively one direction or the other.
Speaker 4 (30:21):
I have a hard time answering that question. It depends
on the films and Star Wars Weather and Star Wars
Star Wars like the first one, any Star Wars. Oh,
I don't know, you're a Star Wars guy, right, Yeah.
I've seen all nine in the theater, all nine, so
they know they were pretty was pretty good. Yeah, okay,
I guess, well the next one I wouldn't be interested.
They've been The last few have been such a such
(30:42):
disappointance that I don't know that I'd spend the money.
Something like Dune is complex. I enjoyed renting that over
the court and watching it rewatching it. Yeah, you know,
Dune is not a one shot thing. You have to
watch it at least a couple of times to really absorb.
Speaker 3 (30:56):
Pick up on everything, don't you. I don't disagree. Yeah, there, I.
Speaker 4 (31:00):
Guess that's why I hesitate. Maybe I'm overthinking the question
which was obviously frivolous and just intended to close out
the show.
Speaker 2 (31:07):
Well, well tastes I've changed, according to you know, according
to a survey of nearly thirty three hundred adults age
twelve to seventy four, how you a survey of twelve
year old But regardless.
Speaker 4 (31:18):
Who's outside that ranger, are they going? It's a pretty big.
Speaker 2 (31:21):
Cohort according to the survey, that this trend has reversed.
So pre COVID preference was running not substantially, but like
fifty eight percent for a preference to in a theater
versus like forty two saying at home, and now it's
pretty definitively preference for at home sixty five percent at
home thirty five percent in theaters. The fat the matter
(31:42):
is regardless of preference. Clearly the box office is having
some return. You know, they are doing a little bit
better this year, and I'll be interested to see if
this sticks and if the preference really matters, because ultimately
it doesn't matter if I prefer to watch a movie
at home. If it only plays in theaters for their
first ninety days of release, then who cares. I'm probably
(32:05):
still going to go to the movie theater if I
want to see it badly enough.
Speaker 3 (32:08):
What do you have for us now?
Speaker 4 (32:09):
Our theater's going the way of office buildings.
Speaker 2 (32:11):
Yeah, that's the question, Like that was the praise that way,
that was the prediction.
Speaker 4 (32:15):
You can't repurpose the theater easily. What do you like? Kickleball?
What are you going to do in there? I'm just
thinking of something that's trending in the opposite direction. Pickleball
comes to mind, But as far as I know, that's
just an outdoor thing. I'm not Seriously.
Speaker 3 (32:27):
They do.
Speaker 4 (32:28):
I've only seen them Mountain.
Speaker 3 (32:29):
In fact, the Natick Mall I think just released it
just so you.
Speaker 4 (32:32):
Can repurpose these big spaces to pick able.
Speaker 2 (32:34):
Yeah, they close the Wegman's grocery store and turn it
into pick a ball. Well, presumably there's not an unlimited
appetite for pickleball square footage, but yeah, maybe there is.
Speaker 4 (32:44):
So Mike, there's this article in Tuck. Thanks for pulling
this Tuck. There's this article on the globe of that
so called quiet vacationing. It's the latest in the trend
of things people are doing to shirk and giving these
euphemisms too so quiet quitting whatever means you're slacking at work.
So quiet vacationing is as it sounds. It means you
(33:05):
ask for remote time but then go mow the lawn
or take a nap, or I don't do something you
normally do on vacation while you're logged into your computer.
And this is one of the many practices, concepts, whatever
you want to call these phenomena that will probably go
the way of the DODO as soon as unemployment breaks
five percent, I would think.
Speaker 3 (33:23):
So Again, the article's phrased in a way of like, oh,
is it immoral?
Speaker 1 (33:27):
Is it?
Speaker 4 (33:28):
Are you stealing from your employer?
Speaker 3 (33:29):
When you sure ethical?
Speaker 2 (33:31):
I mean, how long have people been slacking off at work?
This is just a new version of it.
Speaker 4 (33:35):
We just did it for the last two hours.
Speaker 3 (33:38):
Yeah, exactly.
Speaker 4 (33:41):
Furthermore, mister, I push buttons. Oh look, oh look, there's
a blinking light. Somebody called the tech. Why'd you go
look at a chart? You know your levels are hot? Hey, Mark,
can you talk into the mic? Blah blah blah. Interesting,
I think I should unionize.
Speaker 2 (34:01):
I agree, this goes away the second unemployment creeps up,
and it's not any different from any other.
Speaker 3 (34:06):
Look at these numbers, workplace theft of the past.
Speaker 2 (34:10):
Markets are strongly in positive territory, with the NAZAC leading
the way up one point seven percent. We'll have a
full recap tomorrow on how things close out for the day.
Speaker 3 (34:18):
Have a great afternoon. Everybody will be back at it
then
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(01:04):
by Veterans Development Corporation to Face is the Financial Exchange
with Mike Armstrong and Mark Vandetti.
Speaker 2 (01:12):
Good morning, Welcome back to the Financial Exchange. Equity markets
in the US are in rally mo actually kind of
broadly across the board. I think the Japanese Nik rose
the most since two thousand and eight this morning or
today in trading.
Speaker 3 (01:26):
But US equities up broadly.
Speaker 2 (01:29):
With the Dow of five hundred points one point three percent,
we're raising about half the losses from yesterday. SMP up
eighty seven points one point six to seven percent, NASDAK
about the same in percentage terms, two hundred and seventy points.
Speaker 3 (01:41):
At this point.
Speaker 2 (01:42):
The SMP five hundred off about seven percent now from
its all time highs, after being down about eight and
a half percent from those all time highs yesterday. We
had equity markets broadly down. I think the Nasdaq at
one point was off more than five percent yesterday before
rallying a bit mid day, but again closing broadly down
(02:02):
across the board. And then the interesting piece I think
to keep an eye on has to do with yields.
So in terms of the ten year treasury, now you
have yields moving up a little bit here today, but
sitting at about three point eight six percent on that
ten year yield. And again as opposed to the Fed
funds rate, which just fluctuates by the Federal Reserve, this
(02:25):
is a market driven rate that also ties in a
lot to say. Mortgage rates and everything along those lines
was as high back in April of this year as
four point seven percent, so a substantial drop on the
ten year yield.
Speaker 3 (02:37):
According to Mortgage News Daily.
Speaker 2 (02:39):
Now the average yield average thirty year mortgage rate as
of today this is six point three four percent on
that thirty year fix thirty year jumbo, more like six
point six one percent. So something to continue to monitor here.
And I suppose one of the silver linings of an
economic slow down is those lower rates should they come
to pass.
Speaker 4 (02:59):
I think this confirms the technical explanation as the trigger
what we were calling last hour the proximate cause of
the sell off of the past couple of days. Friday
and yesterday we talked about sophisticated investors who borrow in
low yielding currencies. They buy high yielding currencies that works
until it doesn't, and when it doesn't they have to
sell stuff. And then computer programs that do trading require
(03:20):
that other investors sell stuff. It cascades throughout the globe
and you get these massive, seemingly uncontrolled and not a
left field sell offs, not because of any immediate economic trigger,
even though there were worries about a week labor market
resulting from last week's unemployment report, but resulting from technical
factors and a quick bounce back though we haven't recovered
all of yesterday's losses, but a relatively quick rebound. It
(03:43):
confirms the explanation of what the immediate cause or trigger was.
Not to say there might not be more volatility in
our future. We know volatility tends to bunch up and
perpetuates itself, so we're on the lookout right.
Speaker 2 (03:56):
The longer term, I think volatility that is reasonable to
be concerned about is just the state of the United
States economy. It is slowed enough to get inflation closer
to the Fed's preferred target, and it has by and
large done so because of higher interest rates and a
general slow down in economic activity. Right we've seen the
(04:17):
unemployment rate now climb from three to five to four
to three.
Speaker 3 (04:20):
Nothing that you haven't had, I think so.
Speaker 4 (04:21):
But GDP is still pretty hot.
Speaker 3 (04:23):
GDP is still pretty high. Manufacturing is really slow.
Speaker 4 (04:26):
Positive energy shocks. That's what I always That's what bothers
me a little bit about the triumphalist talk with respect
to inflation. Hey, it's back to two ish percent. It
never levels out at two percent obviously price, but it's
back to being in the background of the point where
you don't have to factor it into your calculations. That's like,
that's a great definition. A low and stable comes from
Builton Friedman. Nobody thinks about it. That's my definition a
low and stable. What if we're only there because energies
(04:48):
come in a lot, right, this is why the FED
hasn't cut yet. They're not sure, and they're they're probably right.
History suggests to be not sure.
Speaker 2 (04:55):
Yeah, So here's where it is long, longer term concerned
that I would have, and I think Man, you have
about the markets and the economy doesn't have much to
do with Japanese trading and borrowing in these complex trading algorithms.
That's not going to be the root cause of a
recession and downturn. The root cause of it would be
a recession that comes out higher unemployment, companies feeling squeezed
(05:17):
in terms of their margins, laying off employees and then
a broad slow down in economic activity, and unfortunately that
type of broad slow down in economic activity which needs
to be orchestrayed to get inflation under control. Whether it's
a recession or whether it's a soft landing, those things
look pretty similar in the early stage.
Speaker 4 (05:35):
Every market downturn, every economic downturn, whether just to slow
down a recession, it's a murder mystery. We know the victim,
we know the proximate cause was Colonel Mustard got it
with a candlestick in a library. For those of you
who know, are like, I'm not a big fan of clue,
but I remember that. But what you don't know is
that really interesting stuff, why and when and was it avoidable?
(05:58):
Economists are still are about the causes for a great depression.
I kid you not, we haven't figured that. I'm not
I don't do that kind of research, But they haven't
figured that out. You never really know. So if we
don't know what happened ninety yeah, I just call it
one hundred years ago. With all this great data and
all these great tools, you think we're gonna be able
to tell you when a recession's coming.
Speaker 2 (06:17):
Probably not, Probably not. Nobody can big announcement yesterday in
terms of Google. So Justice Department, for I think about
a year now has been suing Google in court over
monopolist charges and and to trust charges, and a judge
yesterday found them guilty. Google quote from the from the
(06:39):
ruling from the the federal judge meta here m h
e hta, which is kind of confusing because one of
Google's can pick competitors is meta, but the judge's name
meta quote. Google is a monopolist and it has acted
as one to maintain its monopoly. So whether or not
you agree with the ruling, mark, well, what's the premise
(07:01):
of this? Where where does the antitrust claim come from?
Speaker 1 (07:04):
Here?
Speaker 3 (07:05):
In terms of Google's dominance.
Speaker 4 (07:07):
I understand it if you define the relevant market narrowly
enough as searching they which they've done effectively to the
federal government's credit. I guess in this case, if you're
on their side, you can get the charges to stick.
And a judge agreed you can't monopolize to the extent
that it could hurt consumers, although I don't think they're
(07:29):
using the consumer harm definition here. This is where I
get way out of my league and start to confuse
myself but yeah, Mike, they did a good The prosecutors
did a good job defining the relevant market getting a
judge to buy into that definition and find Google almost
by definition, guilty of monopolizing a market that they created.
Speaker 2 (07:46):
So the market that they are describing here is search,
So online search and the advertising that gets sold attached
to it, that is the market they may have defined.
It's not hardware, it's not technology generally, it is online
search and the advertising revenue that from which you derive
income from that online search. And I think if you're
(08:08):
able to define the market that way, it's clear that
Google has dominance. Right, they made up what was it,
ninety percent of searches across the United States occur on
Google's platform. And then likewise, if you're willing to define
the market as such, then it is pretty clear that
Google has acted monopolistically to harm competition at least and
(08:31):
provide massive barriers of entry.
Speaker 3 (08:33):
How do they do that? Well, they pay Apple.
Speaker 2 (08:35):
In twenty twenty two, I think it was twenty billion
dollars to make Google the default search engine on all
Apple devices and Safari web browsers. So if you're looking
for beyond, it's not good enough to just say, oh,
they've been dominant, you also have to go and prove
what sort of behavior has occurred to make them as
(08:55):
dominant as they are. And that was the evidence that
I think the Justice Department delivered quite well in this case, was, Hey,
not only do they have this dominance, and yes, part
of it might be because they are the best search
and engine out there, but they also prevented anybody else
from getting any dominance here because they made themselves, through
(09:15):
these payments, the dominant search engine on pretty much every
device out there that people use two search things.
Speaker 3 (09:21):
Whether that's Safari or Firefox or any of these other
programs that are out there.
Speaker 2 (09:30):
I think the counter argument here, Mark would be it
is pretty tough to come up with who which consumers
were harmed by this.
Speaker 4 (09:37):
Apparently that wasn't the standard that that the judge agreed
should be applied in this case. An appeals court judge
might decide differently.
Speaker 2 (09:46):
Right, because it is tough for me to sit here
and say, Okay, if I think back over the last
decade of you know, how many searches that I have
played out on Google, I hesitate to come up with
how would I have been better off We're Google not
the default on my web browser. We're Google not baked
(10:07):
into the device that I bought. Automatically, It's never the
default on mine.
Speaker 4 (10:10):
I'm always switching over to Google Chrome, you like on
my iPhone, on my Windows laptop.
Speaker 2 (10:16):
Yeah, you're right, I don't want it, no offense, but
I think if you just open a Safari browser and
type in a search, it is going to default.
Speaker 4 (10:26):
Google search engine. Forgive me right.
Speaker 2 (10:28):
It's not just the web browser. We're talking about the
search engine that's utilized on those browsers. And so it
is tough for me to come up with that consumer harm.
And so this is going to be appealed. Obviously, Google's
going to fight this to the nail because they want
that dominance. It's also really unclear that the other part
that hasn't been spelled out here is what are the remedies.
Speaker 4 (10:48):
What is going to be breaking out in a search business.
Speaker 3 (10:50):
That's what they did, perhaps that's what they did to Microsoft.
Speaker 2 (10:53):
Other things have been said like, okay, you can still
be part of Google's parent company out, but you can't
pay for that default position on web browsers and Apple
devices and et cetera, et cetera.
Speaker 3 (11:07):
And the consumer is going to get to choose it.
Speaker 4 (11:09):
I mean, maybe it's weighing on the stock today. I
was going to brush it off and sayes stock's basically unchanged. Yeah,
but the Tech index in the S and P, the
industry group Tech is up two percent. So it is
apparently should Google chance they have to divest themselves in
this business?
Speaker 3 (11:24):
Right?
Speaker 2 (11:25):
This is a massive portion of Google's revenue, right, Like
search engine advertising revenue is huge.
Speaker 3 (11:32):
It is massive.
Speaker 2 (11:33):
It is how Google built themselves and all the ancillary
businesses that now make some money for them all came
from this dominance.
Speaker 4 (11:40):
Eighty five percent of revenues from online ads.
Speaker 3 (11:44):
Yeah, there you go.
Speaker 2 (11:46):
So it's also unclear to me how you would break
this out, right, Like, if it's the market dominance, then
you would want to somehow break up that Google Search,
not only break it apart from the rest of Google,
but break it up somehow. And I don't That doesn't
make any sense to me, Like, is the Google Search
that I do in the Northeast going to be owned
by a different company than when I travel to Phoenix,
Arizona and Google Search, I don't think.
Speaker 3 (12:06):
So, We're not likely to have that type of breakup.
Speaker 4 (12:09):
Janitor, the people to take care of the plants, and
somebody in accounting.
Speaker 2 (12:14):
YouTube still if you know Gmail YouTube, These are all
other business units of Google, but you're right, they are
nothing in compared to Search and so yeah, the consumer
harm piece, that is a big question to me. I
don't know where this goes long term. How it gets
broken up in some way, shape or form is another
big question. But here's what I will acknowledge. The Justice
(12:35):
Department under Biden and Lena Khan have been pushing, pushing,
pushing on anti trust cases. This is their first and
only win. And I might disagree with some of the
conclusions that the judge made, but they're going to hang
their hat on this as Hey, we might have failed
in these other cases, but this is the first large
ruling again against the tech company on anti trust concerns
(12:59):
since Microsoft, and that's worth noting, whether you agree.
Speaker 3 (13:02):
With it or not.
Speaker 1 (13:03):
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Speaker 2 (13:26):
Uber reported earnings before the bell this morning. Stock is
up big in trading early on seven and a half percent.
What we heard from Uber was a relatively healthy quarter.
And again I find that interesting, not because anybody builds
recession models on Uber's earnings, but much of their business
is a very discretionary type of business.
Speaker 3 (13:48):
Right.
Speaker 2 (13:48):
It's ordering food that you get then delivered directly to
your door. It's pretty discretionary in nature.
Speaker 3 (13:56):
Right.
Speaker 2 (13:57):
This is not grocery store sales. It's not sales of gasoline.
Revenue grew sixteen percent year on year to ten point
seven billion dollars, which was just a head of analyst
forecast of ten points six billion dollars. They saw sales
growth at both the ride healing and food delivery businesses,
and then net income of a billion dollars came in
well ahead of market expectations of only six hundred and
(14:19):
sixty million dollars in that second quarter. The CEO Dara
Dara Kazershawi, Right, I think that first name, yeah, quote,
the Uber consumer has never been stronger. What do you
make of that? Look, this is another one of those businesses.
We had a story yesterday about how twenty somethings were
(14:41):
throwing PowerPoint presentation parties, and I just I was the
first to say that I'm too far removed from that
stage of my life to understand what's going on here. Likewise,
I generally don't use Uber unless I'm traveling via an airport.
What's your take on such robust demand from consumers.
Speaker 3 (14:58):
Here on the Uber place mark?
Speaker 2 (15:00):
Does it in your mind you can coincide with any
other you know, data we've seen on the health of
the consumer.
Speaker 4 (15:06):
I don't know how much you can generalize from it.
I just don't clearly contradicts the slow down story that.
Speaker 2 (15:14):
Because right we've been hearing about that from like McDonald's
and all these companies saying, hey, we have to discount
our pricing because consumers are not spending money well. Uber
comes Orus over the past two weeks are massively year
over year because.
Speaker 4 (15:28):
Consumers could be specific to their clientele. I don't really know.
I'm looking at the stock price. It's still very expensive
relative to traditional mentionments. Revenue growth over the past year
has been reasonably strong, as it has over the past five,
but investors are expecting more so, can they make grocery deliveries,
can they adapt self driving technology? Can they take advantage
(15:49):
of their sort.
Speaker 3 (15:50):
Of first mover.
Speaker 4 (15:51):
Yeah, I might put myself in the skeptical category two,
But what the heck do I know?
Speaker 2 (15:55):
Quite honestly, I was skeptical that this company would ever
make money. Honestly, Like when they first came out, I
was really trying to figure out why on earth people
are going to pay three x what I would need
to pay to go get a McDonald's or to delivered
to my door. And I've been proven pretty consistently wrong. Likewise,
you know, trying to figure out how you're going to
pay a driver, plus you know, undercut cabbies by thirty percent,
(16:18):
and then also make Uber money was really confusing to me.
Speaker 3 (16:22):
At first. I really didn't see a market for it.
Speaker 2 (16:24):
But you know what, they've pretty successfully raised prices. I
don't know, Tucker, I mean, either of you. Have you
compared pricing on a cab versus an uber recently?
Speaker 3 (16:34):
Has anybody done that?
Speaker 2 (16:36):
I have a couple times coming from the airport, and
they're pretty on par these days. I still and oftentimes
prefer an uber because I can have the functionality I
can order it, I can see where I'm going, and
I know that the price quote that I'm getting ahead
of time. Like all of those things are much more
appealing to me. The taxis have finally started to adapt
(16:58):
and roll out some of that technology on their own,
but pricing is basically a parody. The company's making money
and for reasons that I have a tough time understanding.
Because last night's a good example. We wanted pizza as
a family.
Speaker 3 (17:12):
And I was.
Speaker 2 (17:14):
This makes me sound like just such a bad parent,
but like, hey, I'll go get the pizza. Please let
me get out of here for five hours, three hours,
sound like the dad that went out for ice cream
and never came back. But like, you know, the idea
of ordering food on Uber, which by the way, they
bump up the price on there and then you pay
for delivery on top of it. It just has never
(17:34):
had any appeal to me. But clearly it's got a
lot of appeal to a lot of people who are
still paying big dollars. And maybe that's the answer. Is
Uber's customers have a lot more money than McDonald's customers
and are continuing to come.
Speaker 1 (17:57):
Bringing the latest financial news straight to your every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
Thankst us six one seven, three, six two thirteen eighty
five with your comments and questions about today's show and
let us know what you think about the stories we
are covering. This is the Financial Exchange Radio Network.
Speaker 2 (18:19):
We do this program five days a week most weeks
and try and explain a whole bunch of things. But ultimately,
I think why a lot of people tune in and
ask us questions is to try and figure out, well,
what the hell does it all mean for me? Sorry
to be a little bit blunt there, but like, what
should I be doing with all this information that is
(18:41):
constantly thrown at me from the Financial Exchange and Money
and CNBC and whatever program is on Bloomberg any day
the hour.
Speaker 3 (18:51):
What I don't know.
Speaker 2 (18:54):
Do you have a sense of or have you had
a guiding principle over your investment career of when you
think you should make any sort of change to your
investment portfolio based on something or another.
Speaker 4 (19:04):
Investment advisors are useful because they can protect you from
your own worst instincts. What do you hear over and
over from your investment advisor? It's stay the course if
your plan is right given your age and risk tolerance,
stay the course. Stocks have always been the most productive
or generative asset class. They've yielded the highest returns in
exchange for a lot of risk. That's why you get
those returns. But if you're a multi decade investor, if
(19:26):
you're a typical retirement investor, you should stay the course. Now,
our job on shows like this and as a firm
that in our day jobs provides investment advice is often
to explain and describe, but we don't try to predict.
Speaker 3 (19:40):
Give you a sense that that's important distinction.
Speaker 4 (19:42):
We understand, yeah, and sometimes we even fail at describing,
Like we talked about the kit right, Like we think
the so called carry trade buying in a cheap currency
investing in a currency with a higher rate of return.
We think that investors doing that in Japan were the
epicenter of the sell off of the past couple of days,
but we don't really know for sure. As I said
in a couple of segments ago, I think economists still
(20:04):
argue over the causes of the Great Recession, largely agreed
upon that it was in the mortgage market, But are
there are other candidates? Too, the Great Depression. You never
really know, so, but one thing we do on Mike
is that stocks have over meaningful time horizons twenty five
plus years, always for what it is worth. This is
just to use our fancy term egan empirical regularity. I'm
(20:25):
not making a prediction, but for what it is worth,
and this is all we have to go. And they've
always outperformed once, So a diversified portfolio of stocks is
always paid off for a long term investor short term investor.
Different story.
Speaker 2 (20:36):
There are some things that you know, the Journal has
a piece today about, you know, things that you can
be doing in a market like this if you're nervous
and trying to do something. Yeah, when markets are down,
Hypothetically roth conversions can make more sense when they're at
all time highs. There are tax loss harvesting things that
you can be doing. But to Mark's point, I think
very often during times that market downturns, the advice that
(20:59):
you here sent out there over and over is don't
change course, don't do anything. Here's the threshold for me,
and I've been thinking about this a lot over the
last week with the volatility that we've seen, is that
piece of advice I think oftentimes does hold true. And
the threshold in my mind is so long that as
(21:21):
you have planned for this type of downturn, right, like
we just talked about, we don't predict what's going to.
Speaker 4 (21:27):
Happen for a downturn.
Speaker 5 (21:29):
How would you here, Here's here's how I would I
would think about that is have I mapped out in
the event of a market downturn, what that's going to
mean for my investment portfolio.
Speaker 2 (21:41):
And the answer is there's no one size fits all,
because if you're a twenty five year old saving for retirement,
then the answer is you probably just completely and.
Speaker 3 (21:48):
You want those down because.
Speaker 2 (21:51):
You if you are not a twenty five year old
saving for retirement, and maybe you're already a retirement, then
it's about mapping out when you're going to need to
start living off of this or pulling it out, or
maybe you already are, and having a plan for where
that money is going to come from if it's not
going to be the stock market when it's in the
middle of a massive downturn, which we're not in right now.
(22:12):
Again important clarification, we're not there. And so that's my
threshold for hey, should I be thinking about making a
change to my investments, is have I actually thought about
this type of eventuality, because it is an eventuality. Unfortunately,
the best time to be planning all that is a
few weeks ago when markets were at all time highs.
But you know, that's the important distinction is if I'm
(22:33):
sitting here and yes, I've had this plan in place,
and I've thought about the repercussions of a market downturn
that could last five, six, seven years. Right, We've had
market downturns that from peak before the downturn to recovery
have taken I don't know what the longest one is
probably a deck.
Speaker 4 (22:48):
Twenty nine to fifty two great depression cheesz.
Speaker 3 (22:51):
Yeah, right, hopefully that's not.
Speaker 2 (22:55):
But you know it can take a significantly long time.
And so that's where that planning comes in. And that's
where that's the threshold that I would operates. If you
have not considered the possibility of a long, prolonged downturn
and how you would make ends meet in those events.
That's the reason to have a second look, to have
a second opinion, and to get.
Speaker 3 (23:16):
A good close look at what you are doing right now.
Speaker 2 (23:19):
Doesn't necessarily mean make a change because what you're doing
could coincidentally be right. But at least that's the threshold
for when you take a second hard look at what
you're doing today. If you could use some help in
taking that good hard look and evaluating what you're doing
today and how it may fit with your overall strategy,
I would encourage you to call the Armstrong Advisory Group
the phone numbers eight hundred three nine three four zero
(23:41):
zero one. But we have advisors located across New Englands
that sit with our own clients to really build a
concise and individualized plan for your future. If that is
not something you're getting today and you would like to
learn more again, call us at eight hundred three nine
three four zero zero one. That is the number for
(24:01):
the Armstrong Advisory Group free consultations again, whether it's you know,
across the country, across the world offices throughout New England
the number eight hundred three nine three for zero zero one.
Speaker 1 (24:13):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial tax into state planning advisors before making
any investment decisions. Armstrong may contact you to offer investment
advisory services.
Speaker 2 (24:29):
Markets remain pretty strongly in positive territory here. Dow has
fallen a little bit. Sow now up three hundred and
thirty points. That's down from an increase of about five
hundred points earlier. SMP now up one a third percent,
Nasdaq about the same, So again a slight weakening from
where we were earlier this morning. We will see where
things go later in trading. It remains a fairly light week.
(24:51):
Like we mentioned, in terms of big news, we have
some earnings coming in.
Speaker 3 (24:55):
We mentioned Uber.
Speaker 2 (24:56):
Caterpillar also reported earnings this morning and is up in
early t tomorrow. In terms of the earnings that we
will see, we're gonna have Nova, Nordisk, Walt Disney Company
reporting earnings, CVS Health, Shopify. Again, not that these are
insignificant companies, but when you had billion dollar plus companies
reporting all last week, they kind of.
Speaker 3 (25:17):
Don't really compare.
Speaker 2 (25:18):
Eli Lilly is a fairly big reporter coming out on
Thursday morning before the open, and then really until we
get to the next couple of weeks, that's when some
big economic data comes in. The data coming in this week, right,
we'll have weekly job as claims, as we do every week.
But the following week is when we get another reading
(25:39):
on CPI and a whole bunch more data on manufacturing
and import prices, etc.
Speaker 3 (25:44):
So a lot more to come here.
Speaker 2 (25:45):
But you know, in one sense that could be good
news to have a bit of a quiet period, But
in the other sense, you have these new recession concerns
and there's not much in the way of new data
that's going to come out to change that story of
the next few weeks. So that's I guess the forecast
that I would put out there is, Hey, we got
this Job's report on Friday that indicated a previously used
(26:07):
recession indicator. We will see what comes to place. But
there's not a whole lot coming out of the next
few weeks that would serve to steer things in a
different direction other than feeder board member speaking.
Speaker 4 (26:19):
Yeah, there are no indicators coincident other than the Salm rule,
which I think we dispensed with in the last hour.
Even Claudia Samas disavowed it to an extent. She's pointed
out that just because something's always happened doesn't mean it
will right These things tend to work. These regularities that
people observe tend to work until they don't, and then
people forget about them. Lousy predictors, but nothing else. Typical
measures of forward looking economic activity, so called leading indicators.
(26:43):
Some have slowed a bit, they've pointed downward, or their
rate of increase has slowed, but none are pointing toward recession.
I'm not saying that one is not around the corner.
Recessions aren't predictable. If someone tells you they are, that's
pretty much the hallmark of not knowing what you're talking about,
which is why we always.
Speaker 3 (26:58):
Try to slice them.
Speaker 4 (27:00):
Yeah, yeah, beware, Oh god, we haven't even gotten into
that angle of all the people clamoring for a FED
rate cut and how conflicted they are. They all run
money and they want their assets to go up. That's
why their crying sky is falling. Yeah, you can't be
too cynical when it comes to what you hear investment
managers calling for on Financial News.
Speaker 2 (27:18):
Let's take a quick break when we come back. Some
stack roulette on the Financial Exchange.
Speaker 1 (27:22):
Find daily interviews and full shows of the Financial Exchange
on our YouTube page. Like us on YouTube and get
caught up on anything and everything you might have missed.
This is the Financial Exchange Radio Network. There's only one
show that follows Wall Street's continued volatility. Keep it here
all morning long on the Financial Exchange Radio Network.
Speaker 6 (27:57):
This segment of The Financial Exchange is brought to you
in part by the US Virgin Islands Department of Tourism.
The US Virgin Islands or Saint Croix, Saint Thomas, and
Saint John enjoy perfect weather, world class dining, incredible beaches
and a vibrant nightlife. Had to visit USVII dot com
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(28:18):
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USVII dot com.
Speaker 2 (28:27):
Do you think we could do a new segment just
about whether a headline is from Florida or not?
Speaker 3 (28:34):
Yeah?
Speaker 4 (28:34):
I mean that just for spelling you should be able to.
Speaker 3 (28:38):
Well.
Speaker 2 (28:39):
So here's the headline, woman accused of stabbing worker in
head following fight at blank restaurant. What are you think
I'm not going to give you the name of the restaurant.
Speaker 3 (28:48):
Just where did it take place?
Speaker 1 (28:49):
Florida?
Speaker 3 (28:50):
No, Boston restaurant? Incorrect? You confused me? A woman is yeah,
Well that's the that's the game is. Did it happen
in Florida?
Speaker 2 (28:56):
Or did it not? And this time it did not.
Alicia Morassi, twenty nine, of Cambridge, was arranged Monday in
Boston Municipal Court on charges including assault with intent to murder.
So didn't occur in Florida.
Speaker 3 (29:07):
I like this game.
Speaker 2 (29:08):
I'm gonna I'm gonna start making most of my headlines
about this.
Speaker 3 (29:11):
Why are we talking about this? I don't know. Just
came up in my news feed. I figured i'd bring
it up. Gotcha? Uh how would if you had a choice? Right?
Speaker 2 (29:21):
Like movie is getting released both to theaters and streaming.
This has nothing to do with stabbing anyone in the head.
Speaker 3 (29:28):
I'm sorry, I have to I have to pivot here.
Speaker 2 (29:31):
Uh would you prefer to go to the theater and
experience a movie theater or would you prefer to watch
it at home? And has that view changed since COVID?
I'm asking the job Marblock here, Tucker, it can be you,
it can be Mark.
Speaker 6 (29:46):
I prefer I can't remember the last time I've been
in the theaters, so okay, clear, although I did make
a I did make a purchase for a ticket, and
then changes got played.
Speaker 3 (29:54):
I had, you know, changed up.
Speaker 6 (29:55):
I was supposed to go to Dune Too and in
the theater, and then I could make it.
Speaker 1 (30:00):
Yeah.
Speaker 2 (30:00):
I mean, there's been a few big hits that I
think I would have normally gone to see in the
theater recently that I haven't. Dune Too is one of them.
I saw saw it on an airplane instead. Deadpool Wolverine
is like again, typical comedy action movie that I would
consider seeing in the theater. Mark, you're just smirking at me.
No preference or definitively one direction or the other.
Speaker 4 (30:21):
I have a hard time answering that question. It depends
on the films and Star Wars Weather and Star Wars
Star Wars like the first one, any Star Wars. Oh,
I don't know, you're a Star Wars guy, right, Yeah.
I've seen all nine in the theater, all nine, so
they know they were pretty was pretty good. Yeah, okay,
I guess, well the next one I wouldn't be interested.
They've been The last few have been such a such
(30:42):
disappointance that I don't know that I'd spend the money.
Something like Dune is complex. I enjoyed renting that over
the court and watching it rewatching it. Yeah, you know,
Dune is not a one shot thing. You have to
watch it at least a couple of times to really absorb.
Speaker 3 (30:56):
Pick up on everything, don't you. I don't disagree. Yeah, there, I.
Speaker 4 (31:00):
Guess that's why I hesitate. Maybe I'm overthinking the question
which was obviously frivolous and just intended to close out
the show.
Speaker 2 (31:07):
Well, well tastes I've changed, according to you know, according
to a survey of nearly thirty three hundred adults age
twelve to seventy four, how you a survey of twelve
year old But regardless.
Speaker 4 (31:18):
Who's outside that ranger, are they going? It's a pretty big.
Speaker 2 (31:21):
Cohort according to the survey, that this trend has reversed.
So pre COVID preference was running not substantially, but like
fifty eight percent for a preference to in a theater
versus like forty two saying at home, and now it's
pretty definitively preference for at home sixty five percent at
home thirty five percent in theaters. The fat the matter
(31:42):
is regardless of preference. Clearly the box office is having
some return. You know, they are doing a little bit
better this year, and I'll be interested to see if
this sticks and if the preference really matters, because ultimately
it doesn't matter if I prefer to watch a movie
at home. If it only plays in theaters for their
first ninety days of release, then who cares. I'm probably
(32:05):
still going to go to the movie theater if I
want to see it badly enough.
Speaker 3 (32:08):
What do you have for us now?
Speaker 4 (32:09):
Our theater's going the way of office buildings.
Speaker 2 (32:11):
Yeah, that's the question, Like that was the praise that way,
that was the prediction.
Speaker 4 (32:15):
You can't repurpose the theater easily. What do you like? Kickleball?
What are you going to do in there? I'm just
thinking of something that's trending in the opposite direction. Pickleball
comes to mind, But as far as I know, that's
just an outdoor thing. I'm not Seriously.
Speaker 3 (32:27):
They do.
Speaker 4 (32:28):
I've only seen them Mountain.
Speaker 3 (32:29):
In fact, the Natick Mall I think just released it
just so you.
Speaker 4 (32:32):
Can repurpose these big spaces to pick able.
Speaker 2 (32:34):
Yeah, they close the Wegman's grocery store and turn it
into pick a ball. Well, presumably there's not an unlimited
appetite for pickleball square footage, but yeah, maybe there is.
Speaker 4 (32:44):
So Mike, there's this article in Tuck. Thanks for pulling
this Tuck. There's this article on the globe of that
so called quiet vacationing. It's the latest in the trend
of things people are doing to shirk and giving these
euphemisms too so quiet quitting whatever means you're slacking at work.
So quiet vacationing is as it sounds. It means you
(33:05):
ask for remote time but then go mow the lawn
or take a nap, or I don't do something you
normally do on vacation while you're logged into your computer.
And this is one of the many practices, concepts, whatever
you want to call these phenomena that will probably go
the way of the DODO as soon as unemployment breaks
five percent, I would think.
Speaker 3 (33:23):
So Again, the article's phrased in a way of like, oh,
is it immoral?
Speaker 1 (33:27):
Is it?
Speaker 4 (33:28):
Are you stealing from your employer?
Speaker 3 (33:29):
When you sure ethical?
Speaker 2 (33:31):
I mean, how long have people been slacking off at work?
This is just a new version of it.
Speaker 4 (33:35):
We just did it for the last two hours.
Speaker 3 (33:38):
Yeah, exactly.
Speaker 4 (33:41):
Furthermore, mister, I push buttons. Oh look, oh look, there's
a blinking light. Somebody called the tech. Why'd you go
look at a chart? You know your levels are hot? Hey, Mark,
can you talk into the mic? Blah blah blah. Interesting,
I think I should unionize.
Speaker 2 (34:01):
I agree, this goes away the second unemployment creeps up,
and it's not any different from any other.
Speaker 3 (34:06):
Look at these numbers, workplace theft of the past.
Speaker 2 (34:10):
Markets are strongly in positive territory, with the NAZAC leading
the way up one point seven percent. We'll have a
full recap tomorrow on how things close out for the day.
Speaker 3 (34:18):
Have a great afternoon. Everybody will be back at it
then
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