September 5, 2024 • 36 mins
Chuck Zodda and Mike Armstrong explain why cheering on the yield curve could be foolish. American drivers signal a top in gasoline demand. A supersized Fed rate cut this month could be very dangerous for markets. A 'retirement disconnect' has swept across multiple generations of Americans. Nvidia says it has 'not been subpoenaed' by the DOJ in latest probe. Beyond Meat to launch new steak alternative as it focuses on health.
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Episode Transcript
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Speaker 1 (00:00):
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Speaker 2 (01:12):
Chuck, Mike and Tucker with you here, and we've got
a market that can't make up its mind where it
wants to go. The Dow is down one hundred and
seventy three points, the S and P is down ten.
The Nasdaq, though, is up fifty three. So again kind
of just chopping around now after you know, a day
of excitement where we fell a couple percentage points to
start the week. The ten year US Treasury is down
(01:36):
one base no, it's one, down one tenth of a
basis point now. Uh and is sitting at three point
seven six seven percent. Oil West Texas Intermediate is up
a dollar thirty two barrel to seventy dollars and fifty
two cents. The triple A national averageur gas price is
continuing to slide, though, down another nine tenths of ascent
overnight to three point thirty and eight tenths of ascent.
(01:59):
Nice to see getting down into the low threes as
opposed to the mid threes where we spent most of
the summer, and gold we've got up fourteen dollars and
twenty cents announce right now to twenty five one hundred
forty dollars and twenty cents.
Speaker 3 (02:15):
Tomorrow we have the jobs report coming out Chuck at
eight thirty, and I guess I'm just wondering, are we
finally back to the point where bad news is bad
news again?
Speaker 2 (02:24):
Not necessarily right, I do really wonder.
Speaker 3 (02:27):
I mean to me, if you see the unemployment right
jump to four and a half percent, I'm very concerned
about imminent recession. But I'm also pretty sure the Fed
might do a fifty bit cut in that case.
Speaker 2 (02:37):
There are three possibilities here tomorrow. The first is that
you get bad news and it's viewed as bad news,
in which case the market pops is the technical term.
The second is that the market views bad news is
good news because of what you just outlined, and the
market says, oh, well, the Feder'll rescue us and we'll
be fine. The third is that good news is viewed
as good news and the market rallies on that. There
(03:01):
is no scenario in which good news is viewed as
bad news, because the only way it would be is
if inflation. We're still a question and there is literally
nothing out there right now that is pointing towards renewed
inflationary pressures at this point, yeah, one would think, no.
Speaker 3 (03:15):
That find me a data point right now. That's like,
I'm not matifation. I'm talking about how markets react to it.
Speaker 2 (03:22):
So, having said all that, if we get good news tomorrow,
the market is gonna sell off now, right.
Speaker 3 (03:26):
Because that's the only scenario that check didn't cover. So
this is where this is where we are.
Speaker 2 (03:32):
Uh. There's a piece in the bloomy Berg today. It's
titled cheering the yield curve not so Fast. And here
is what happened to yesterday. The yield curve it uninverted, Micael,
who cares? What does that mean? What it means is
that the yield curve is no longer upside down? Okay,
what does that mean? It means that I'm trying to
(03:52):
draw this out as much as possible. Uh. The two
year Treasury rate for a very brief period of time
went back below the ten year TIS rates Okay, which
is where it normally is during a typical market environment.
Speaker 3 (04:05):
Logically makes sense if I'm going to loan somebody money
for two years, I would expect a lower interest rate
than if I were to loan some of that same
person money for ten years.
Speaker 2 (04:13):
It's been inverted for the last couple of years now,
largely because the FED had to hike interest rates in
order to get inflation down, or try to get inflation down.
Speaker 3 (04:22):
Which was historically fairly reliable recession indicator. When that yield
curve becomes inverted, recession to come. That's one of the
ones that people talked about for a long period of time.
Had some false positives, so not always reliable, but was
and logically kind of makes sense, right, if you're so
concerned about what's going to happen in the short term,
then you might be willing to give up return to have,
(04:43):
you know, guaranteed results for the long term, which is
kind of what you have when you have an inverted
yield curve. You're saying, now, I don't want the higher
payment in two years, I'd rather take the lower payment
for ten.
Speaker 2 (04:52):
So, with the yield curve uninverting again very briefly yesterday,
today we're back to being oh so slightly inverted. The
two year treasury is at three point seven eighty five,
ten years at three point seven six eight, so there's
a point zero one nine percent divergence between them. At
the moment, still you know, slightly inverted. But the question is, okay,
(05:16):
what does this mean? And unfortunately, in this case there
are fewer false positives because typically the uninversion of the
yield curve is a much more reliable predictor of impending
recession that also tends to happen much closer from a
(05:37):
time period standpoint.
Speaker 3 (05:39):
So what we are seeing right now, your point would
be what we are seeing right now has reliably in
fact called recessions more often where you have an inversion
and then it's slowly more reliably.
Speaker 2 (05:50):
Yes, it's still not something where you like set it in,
forget it in a bank on it, because there's nothing
like that in economics. It's it's not how it works.
It's not physics. If you go and look at the
data and Brent Donnelly pulled this data for me, well
you didn't pull it for me. He published it and
sent check a text. It did not get a text. Instead,
(06:14):
what you end up seeing is that for all of
the recessions dating back to looks like nineteen seventy eight.
I guess that's the data point the data period that
he looked at. You pretty much ended up with recession
within six months or so, if not if not already
being in recession, with basically three false positives. One in
(06:37):
nineteen ninety eight, which was when long term capital management
blew up, and the US did not in a recession
for two years. Two false signals in two thousand and six.
The US did not inter recession for two years there
as well, and other than that, it's basically been less
than six months and recessions started oy. Again, there are
(06:58):
false positives here, well, there are more unfalse positives true
positives as they're typically referred to, So it's it's something
to be aware of other things that you need to
pay attention to. Though on this first recession does not
inherently mean that stocks lose value over the course of
(07:19):
said recession. There are a number of documented recessions where
during the course of the recession the S and P
five hundred actually went up, so it doesn't simply mean
sell everything and go away. In some cases it does,
in some cases it doesn't. Next, the depth of the
recession does not predict how badly the market is impacted.
(07:40):
The two thousand and one recession fairly mild in the
broad scheme of things. Stocks got absolutely hammered because.
Speaker 3 (07:47):
They were valued through the roof, and the length of
time it took for them to recover was especially.
Speaker 2 (07:53):
Took decade, and so like the NASDAK didn't take like
fourteen years to recover back to where it was. So again,
the depth of recession does not equate to how badly
stocks do or how long it takes them to recover.
All of this is a fancy way of saying, even
if you knew that recession was coming, knowing the right
buttons to push in exactly when to push them is
(08:16):
a really complicated task, and most of us are not
equipped to do that.
Speaker 3 (08:21):
But you know why this all matters as a reminder.
When you are investing in the stock market, what you
are buying is the future earnings of publicly traded corporations,
and there's a price for that. Today that price is
pretty historically high in the twenties, meaning you're paying twenty
plus times the future predicted profits of corporations in the
(08:42):
United States for owning those companies. And the problem with
recession is that usually two of those things change, one
the price that people are willing to pay and to
the earnings that those companies are.
Speaker 2 (08:57):
Generating, yes, and they both changed negatively typically yes. So
this is where we stand today. Again, every investor is different. Again,
most of you listening like you've lived through recessions. Again,
there have been six since nineteen seventy eight. So if
you haven't lived through one, you literally had to have
(09:18):
been born three years ago. Yeah, you know, my one
year old has not lived through a recession. Four year
old has no no even there, born too late in
the year. So in any case, as you you know,
go through this. Remember when when you look at the
historical performance of equity markets, they don't take out the
(09:41):
recessions and say, hey, here's how we did otherwise. No,
like all that historical performance includes recessions. It includes the
bad times as well. And if you're not comfortable with
something that you own, you know as an equity holding,
going down in value, you got to rethink flash, you
(10:02):
got to rethink your ability to actually own equities, because
equities do go down. Sometimes, sometimes they stay down. Sometimes
sometimes you have a company, even like the best companies Amazon.
This is one that I ask people like an awful lot,
because I think it's a really great example. Here. Imagine
(10:22):
that you're an Amazon stockholder back, you know, right before
the tech bubble, and you say, look this Bezos guy, Man,
I really believe in him. He seems like a smart dude.
He's got having beat up Old Civic, he's got a
great haircut, Like I like everything about this dude. This
is gonna be the guy that this is gonna be
the guy. And then Amazon stock proceeds over the course
(10:45):
of you know, early two thousand through mid two thousand
and one to lose ninety five percent of its value. Oops,
are you the guy that sits there and says, no,
I'm still believing in it after that? Because even the
best companies like this, Is there any denying that Amazon
is one of the best companies in the world today,
(11:06):
it's kind of hard to kind of hard to deny that. Yep,
they fell flat on their face and were down, Like
if you had one hundred dollars invested in it went
down to ten. Are you really sticking with it? It's
tough for a lot of us to do that, but
that's what stocks can do. They get absolutely crushed. Sometimes
they continue and lose the rest. Yeah, sometimes this sea
(11:27):
is toyest. Sometimes you buy a pets dot Com instead
of an Amazon dot com and you're like, why didn't
I buy the other dot com? M I don't know,
I don't know.
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(12:00):
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Speaker 2 (12:09):
Fascinating data from the Energy Information Administration and Federal Highway
Administration that is published in a Bloomberg piece today, and
the basic premise is this, if you look at Americans
over the last thirty years, right now, we're driving about
thirty five percent more miles than we were back in
(12:31):
ninety five. Okay. On the other hand, excuse me one second,
the essue thank you. The gasoline that we consume is
only fifteen percent higher than nineteen ninety five, so there's
been a divergence in miles driven versus gasoline consumption, as you.
Speaker 3 (12:50):
Would explore fuel efficiency and electric cars. All sorts of
stuff makes sense here, correct.
Speaker 2 (12:56):
The really interesting thing is since the twenty eighteen through
twenty twenty peer vehicle miles have still increased, We're now
at a new peak for vehicle miles traveled, gasoline consumption
down four percent from that peak. That is the interesting piece.
Speaker 3 (13:11):
The last three years twenty twenty one, twenty twenty two,
even twenty twenty three, to some degree I could discount
some people still were not traveling. We are now again
much higher on the miles travel than finally hitting this
uh seeming perhaps actual peak in domestic gasoline demand.
Speaker 2 (13:32):
Could this reverse?
Speaker 3 (13:33):
Yeah, I mean I could see it reversing at some
point if we really really get a year where the
economy is chugging along and people are hitting the road
even more.
Speaker 2 (13:41):
But I mean we're already there right.
Speaker 3 (13:43):
Miles traveled is up again compared to twenty eighteen, gasoline
consumption down, and this does add up with more and
more hybrid vehicles, with more and more evs hitting the road.
I know that we live in a unique part of
the country here in the Northeast, but not a day
goes by that I don't see several electric vehicles. Most
people don't live in the Northeast, right, agreed, Like I
(14:06):
know that this is different in Texas, but the adoption
of electric and hybrid vehicles, while slower than Ford and
GM and all the carmakers would have thought a few
years ago, is making a significant dent on gasoline demand,
which is not exactly a catastrophic scenario for the big
(14:28):
oil companies, but is a shift from something that's been Yeah,
we've been talking about peak oil demand for years, decades,
and we may, at least in the United States have
hit it on the gasoline.
Speaker 2 (14:40):
Side of things, at least right There are plenty of
other places where you say, no, we probably haven't. Jet fuel,
jet fuel, boat fuel, even diesels probably still on the uptick.
In the US, I would imagine you will get plastics demand,
and what you're seeing on that front that is not
showing any signs of abating. In fact, it's continuing to grow.
So this is not to say that oil as a
(15:03):
whole is necessarily you know, problematic, but more look, one
of the key drivers of oil demand historically has been
US gasoline demand. That is no longer a marginal driver
of increased activity, increased demand for oil.
Speaker 3 (15:20):
Never really thought about this significantly, But wouldn't electric boats.
I know that the whole company called Electric Boat that
makes submarines, But electrified boats be a really low hanging
fruit segment, right, You're not taking road trips on American
boats generally speaking, Like everyone that I know that owns
a boat uses it on a lake for a few
hours during the day and then parks it back at
(15:41):
their dock at night.
Speaker 2 (15:43):
Few problems. The first is weight yep, batteries are really heavy. Yep.
The second is electricity and water generally don't mix great. True,
So you end up problem there. You end up with
some problems there.
Speaker 1 (15:56):
Yeah.
Speaker 2 (15:56):
And if you know anything about owning a boat, it's
really hard to keep water out of all parts of
the boat permanently. Yeah, as much as you try, Like,
there's always little things that happen in this and that. Okay,
dumb idea. I don't know who that's dumb, but it's
there's problematic stuff there, And I don't know. The boat
demand that creates most of the demand for fuel is
(16:19):
not people going out on Winnipesaki, right, it's boats going
through the Suez Canal. And getting stuck.
Speaker 3 (16:27):
Yeah, yeah, yeah, the diesel demand is a little bit
more significant then.
Speaker 2 (16:31):
For a stuck boat, demand for fuel is pretty low.
But for unstuck boats.
Speaker 3 (16:36):
Yeah, they burn a fair bit of that. From what
I understand, it's it's high.
Speaker 2 (16:41):
Let's see today's piece. Today's piece that I just find
rather humorous from CNBC quote a supersized FED rate cut
this month could be very dangerous for market. Economist warrens Okay,
first of all, if there's actually something that's catastrophically wrong
with the economy, saying hey, we're just gonna move slowly
(17:02):
because we don't want to spook people ends up getting
you into a situation where you spook people because the
economy worsens because you didn't want to spook people. It's
very dumb. If you gotta cut fifty BIPs, you cut
fifty BIPs. If you don't have to cut fifty BIPs,
you don't cut fifty BIPs.
Speaker 3 (17:18):
Now, if the unemployment rate comes in at four point
two percent and the FED cuts rates by fifty BIPs,
then sure go ahead and write this article.
Speaker 2 (17:24):
Otherwise, just please stop. It's just look, what's more dangerous
for markets is the FED not doing the right thing
because they're worried about how it looks. Correct, they got
to do what they got to do. If they do.
Speaker 3 (17:39):
Cut it by fifty basis points at the next meeting,
then any and of all of us should take that
as a serious indication that the FED is very worried
about the state of the economy.
Speaker 2 (17:48):
Yeah. I think that's a fair a fair position to take.
Speaker 3 (17:51):
But don't talk about a potential mistake that they could
make before they even make a decision.
Speaker 2 (17:55):
You're gonna take a quick break here, and when we return,
we've got the trivia answer. And then in video, indicted
Boomberger said they had been subpoenaed by the DOJ and
video saying, nahuh we didn't.
Speaker 1 (18:11):
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Speaker 2 (18:34):
There's a PCE and CNBC today talking about a retirement
disconnect that is sweeping across multiple generations of Americans. What
is this disconnect?
Speaker 3 (18:42):
Michael, Well, it's between what retirees or eventual retirees want
out of retirement and what they think they'll actually be
able to accomplish. And I would make the argument that
this is not necessarily the worst disconnect to have. Yes,
I think when you survey Americans, most of them say, look,
I don't want to be working. I want to be
able to have time to travel extensively. I want to
(19:03):
be able to spend the majority of my time with
family on you know, relaxation and leisure activities. But when
you also ask them they think they'll actually be able
to do that, the answer by and large is no,
not really, And that's what you are finding in this survey. One,
I would argue that most people haven't done the actual
work to find out whether or not they can afford
(19:24):
to have the retirement lifestyle that they are looking for.
And two, nobody really knows long term how this all
plays out and where those expectations land. But my overall
point on this would be having a planning for the
worst and expecting for the best is probably the best
thing that you can do when it comes to your
(19:45):
overall retirement plan. But before any and all of that,
if you haven't actually spent any time looking into how
much it's going to cost you to retire, if you're
planning to relocate, where you're going to relocate to, what
the tax situation looks like, you're to downsize, what it's
going to cost you to do all of that. If
you haven't built out a plan to address any of
these things, then there's no possible way you can know
(20:08):
what sort of lifestyle you can afford to have in retirement.
It really does come down to individualized planning when it
comes to planning for that stage of life. And I
often tell people this, but in many cases, while the
work that you do for retirement in your thirties, forties,
and fifties is hugely impactful on your retirement, it's also
(20:32):
rather simple.
Speaker 2 (20:33):
It is.
Speaker 3 (20:34):
It's just how much can you afford to save stash
as much away in that retirement acount as possible in
most cases, and that's the best strategy to make. When
you get into your late fifties, sixties, and seventies, the
strategies that you employ are arguably less impactful on your
long term retirement, but are significantly trickier with a lot
more pitfalls.
Speaker 2 (20:54):
Yeah, I think it's something where again, ultimately I've said
this before, every single year you got to spend some
time working through this. It doesn't have to be you know,
days on end, but you work for two thousand hours
a year in a normal year. If you're not spending
(21:17):
five to ten hours a year, not a day, but
a year, like half an hour maybe an hour a
month trying to work on this stuff, you're doing all
that work at the service and one year, maybe hey,
prioritize getting to understand different retirement account types. The next
start to understand the investments inside your four to one
(21:37):
K or four or three B or other retirement plan.
The one after that, learn a little bit about social security.
Like you don't have to do it all at once,
but tackle one big topic a year and just spend
a few hours educating yourself about it, because then it
allows you to answer these questions, It really does.
Speaker 3 (21:56):
I know there's a lot of you listening right now
that you're either in this position or know somebody who
is you know, is facing down these questions doesn't know
how to address them.
Speaker 2 (22:07):
And I'm just.
Speaker 3 (22:07):
Here to say that I know, you know, putting your
head in the sand and delaying these decisions can oftentimes
be the most common solution, but it is the worst one.
And if you have these types of questions or concerns
and are trying to figure out how to plan for
your own eventual retirement, give the folks at Armstrong Advisory
Group a call offices throughout New England. We work with
(22:30):
our clients day in and day out to try and
solve these problems and address these concerns. The number for
the Armstrong Advisory Group eight hundred three nine three for
zero zero one. We offer free consultations all across New England.
Once again that number eight hundred three nine three for
zero zero one.
Speaker 1 (22:47):
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. I'm Strong may contact you to offer
investment advisory services.
Speaker 2 (23:03):
Mike in Vidia said yesterday that they were not subpoenaed
by the DOJ about an anti trust probe. This comes
on the back of a Bloomberg News report that they
had been subpoenaed by the DOJ I cannot imagine that
Nvidia is lying about this, because if there's one thing
that the SEC would frown upon, it's probably lying about
whether or not you were subpoenaed by the DOJ about
(23:25):
an anti trust probe.
Speaker 3 (23:26):
Probably, so I'm guessing that they are right. I would
also argue that the difference ultimately between a civil investigative
demand versus a subpoena, which seems to be some of
the divergence here, is probably not all. I mean, obviously,
a subpoena is likely more severe than a civical investigative demand,
(23:50):
but it doesn't change the fact that somebody at the
Department of Justice is researching potential anti competitive behavior by
a video that seems to be not really in question.
Speaker 2 (24:04):
Yes, it's not clear how far along that is, or
how serious it is, or whether it's actually going anywhere.
And the other thing that I think is interesting about this,
here's the part that's kind of interesting and confusing about
this to me. Two years ago, i think it was two,
(24:25):
the United States passes the Chips Act, trying to fund
semiconductor production in America, right yep. As part of that,
a big chunk of that money was pretty much earmarked
for Intel, saying hey, we want you to be kind
of the face of this. There are some going to
other companies as well for American production. I don't know
(24:46):
exactly how much was going to each company, but Intel
was a big chunk. I think it was like twenty
billion out of the sixty billion. And in that case,
the United States government said, hey, we want to basically
build like kind of an national champion company that is
going to be the face of American semiconductor production. An Intel.
(25:06):
Now that's also fallen flat on its face. And Intel
isn't doing very well, and it's questionable whether they're even
gonna end up perceiving all of the Chips Act money
because they are milestones they have to meet before they
do so. But the US government, this administration, the Biden administration,
said yeah, we're cool doing this. Now you've got Nvidia,
who is probably what Intel wants to be. You know, like,
(25:30):
I'm willing to bet that Intel wakes up most days
and it's kind of like, man, be nice to be them.
Speaker 3 (25:37):
I'm not sure the US government wants Intel to be that,
because the US government wants manufacturing, which in Vidia does
not do.
Speaker 2 (25:43):
They don't but You've got a company that is at
this point at least kind of thought of as like
the gold standard for AI chip development, and in a
very kind of adjacent area, the US government is saying, yeah,
we're okay with the National Champion franchise, and in this space,
(26:04):
it's hey, we're not sure if we are. And that's
troubling to me because it's kind of like, well, what
do you want me to do? So you want me
to get big but not too big?
Speaker 3 (26:14):
Well, I mean, if so, the rumor mill right, the
allegations against what has been happening in Nvidia, I don't
know that you want to ignore them entirely because the
allegations have been Look, if you are a company trying
to order our chips and you order from anybody else too,
We're not going to fill your order. It's kind of
(26:34):
the definition of anti competitive.
Speaker 2 (26:37):
Now.
Speaker 3 (26:38):
I don't know that the VIDIA has monopoly power in
the space, but I'm not sure you want to just
turn a blind eye to that either, because that does
kind of get in the way of you know, if
you're the United States government and you want to support
a domestic chip manufacturing space, you know, in Vidia telling
their customer or more competition in Vida, telling your customers, hey,
you can't buy from anybody else that might develop those
(26:58):
chips in the United States.
Speaker 2 (26:59):
It's but probably it's a fine line to try to navigate.
It is. Let's take a quick break here. When we return,
let's do a little bit of stack roulette.
Speaker 1 (27:09):
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Speaker 2 (28:07):
Mike, what do you got for me? For stack Roulette?
Speaker 3 (28:09):
Beyond Meat plans to launch a new steak alternative as
it focuses on health, And I'm here to say that, Look,
if you can't make your fake ground beef taste all
that great, then you're not gonna get there with a
fake steak, fake ribbi. Huh, Well, it's just not gonna
happen beyond that. There you go, You see what I
(28:31):
did there?
Speaker 2 (28:32):
Yeah? Yeah, here's the thing. What's the price point for
their their sausages and stuff? It's like two to three
x the regular price. I don't know if it's quite there,
but yeah, it's at least two x. Yeah, it's not cheap.
So so what are you gonna be charging for these
you know ribbis?
Speaker 4 (28:46):
Like seeing something like that for the sausage?
Speaker 2 (28:49):
What's ninety nine for the sausages a three pack? So
what are you gonna be charging for the ribbi? Like
thirty five dollars a pounds? Gonna be waggedy price? What
am I doing here? On top of that as we've discussed,
going to look at the marbling and that fake piece
of meat. They say that they're leaning into health conscious
and I'm here to tell you, look, I don't know
(29:10):
the answer, but there's nothing about something being made from
plants that makes it inherently healthy. No one sits down
is like, you know what big bag of chips today
because they're plant based? What a healthy day?
Speaker 1 (29:23):
Like?
Speaker 2 (29:23):
No one does that. It's just just because something comes
from plants doesn't mean it's great for you. You know,
there's the whole you know, remember everyone's like trying to
cut out carbs, like the whole Atkins diet and this
and that. You know where most carbs come from, plants,
wheat you know, like just because it comes from what
(29:46):
is it like recycled p protein or something like that.
Speaker 3 (29:49):
Beyond us hoping to win over consumers who thought it's
products were too processed by trimming it's an ingredient list
and focusing it's Marcus marketing on the benefits of a
plant based diet. So it's going to I mean, I
don't think you put in all these processed ingredients because
you like using processed ingredients. It's probably to make it
taste as close to what you had it as as possible,
(30:10):
and so you're gonna make it taste worse and try
and market it as healthy. And I just if I
want to eat healthy, I'll just eat a vegetable.
Speaker 2 (30:19):
Right, I'll go have an apple, you know, I'll go outside.
I'll pull some oak leaves down and eat those and
call it a day. Can you what an oak leaves
taste like? Who eats oak leaves? I don't know. I
was just spitballing here. Again, things that you wouldn't want
to do just because they're plant based. Like, plant based
does not inherently mean it's great for you. Yes, if
(30:41):
you're getting an apple or a green pepper, you know,
a beat or something like that, it's fine. I'm much
more interested.
Speaker 3 (30:49):
Like the piece of the fake meat market that does
intrigue me is the lab grown stuff that they're trying
to do. They're like that stuff. I don't know if
it's gonna taste any good. I just find it fascinating
that they are actually try to replicate the cells of
actual meat in a lab without actually growing and slaughtering
an animal.
Speaker 2 (31:05):
Really, I think I think it's at least cool. And again,
it's it's not saying it's gonna be healthier. It's just no,
he grew this ribbi in a lab. Fine, I'll try
that once. This I don't know. I mean, yeah, enough
trouble mimicking the taste? Who said enough trouble making mimicking
the taste and texture of sausages and ground beef. It's
(31:27):
not gonna work with a steak. I just don't know
if it's gonna end up working with uh with the steak,
especially at the price point.
Speaker 3 (31:34):
It's tough enough for me to buy like a nice
ribbi in the first place. If it's twice the price
and is worse in quality, forget about it.
Speaker 2 (31:44):
Either of you excited for the new iPhone launch next week? No?
Speaker 4 (31:49):
No, although mine is really bugging out for me lately.
Speaker 2 (31:53):
What what are you running these days?
Speaker 3 (31:54):
He's got a bunch of iPhone Yeah, it's got an
so the tens what like five or six years old?
Speaker 2 (32:00):
It might be six, Yeah, somewhere in that ballpark. Are
you in the market for a new one? Or are
you just you know, still a wait? If anything? If anything,
it'd be like a fourteen years old, a generation or
two behind it.
Speaker 3 (32:12):
When do they stop supporting these like, is your iPhone
still getting updates?
Speaker 2 (32:16):
Tucker, Yes, So they got this new one that's going
to be coming out. And the big thing is they're
trying to really promote this as the first device that
is built for on device artificial intelligence. And I'm just
not sure how much of a selling point that's going
to be for people right now, just because here's the thing.
(32:39):
With all of the other stuff that Apple has been
able to sell really well, it's stuff that people didn't
know they wanted, but ultimately they did think about the
first one. It's hey, think about the iPod just as
an example, the selling premise was easy, it's all your
music in your pocket. Great, I get that. The iPhone.
(33:01):
Hey it's the Apple phone and your music's there, YadA, YadA.
And then they added everything on there the watch. Hey,
it's all your Apple stuff on your wrist. This with AI,
is there broad familiarity with how people actually use AI
on a daily basis? Now?
Speaker 3 (33:21):
No, But what if we get to the point where
Apple iPhone users are just far better at things like
talk to text and you know the Google Assistant type
questions that people frequently ask Siri, are.
Speaker 2 (33:35):
They like do Apple people use those more. I don't know.
Speaker 3 (33:39):
My point would be, if Apple's product is now significantly
better than all the competition in that space, is that
what does it right? Is that where it goes, is
that what makes it the desirable product compared to buying
the previous generation phone.
Speaker 2 (33:54):
I don't know. I just I'm done doubting Apple. No,
I'm not like they're gonna sell million, tens of millions
of these things like it's but I hear people talking
about this like, oh, this is gonna be a major
upgrade cycle because of AI, And I'm sitting there, I'm going,
does the average person care about AI yet?
Speaker 1 (34:13):
No?
Speaker 3 (34:13):
I think it takes a little bit longer than that.
And I also the downside to this that I don't
see is I can't tell by looking at the phone
from the exterior as to.
Speaker 2 (34:24):
Whether or not it's the latest and greatest.
Speaker 3 (34:26):
With the AirPods, with your watch, with many Apple products,
I've made the argument that the compelling case for owning
it is that it's a fashion symbol, it's a status symbol.
Speaker 2 (34:35):
It's you know, look at me.
Speaker 3 (34:37):
I have the latest and greatest Apple Watch, I have
the you know, the pro headphones, and I've got my
two thousand dollars iPhone, so you're not gonna be able
to really tell that there's some integrated software in here.
Speaker 2 (34:50):
Speaking of fashion symbols, have you noticed that after that
initial like one week of buzz, there are no videos
of people driving around in their Vision Pro helmets anymore?
Speaker 1 (35:00):
Hell out?
Speaker 2 (35:01):
Yeah, you know, the buzz just really didn't last long
on that one. Yeah. I hope they can that project.
I hope they build it into something that's interesting, but
it's you don't see anyone talking about it. It's not
on social media anywhere.
Speaker 4 (35:16):
At this point, it doesn't seem like there's buzz from developers.
Speaker 2 (35:19):
By the no.
Speaker 1 (35:20):
No.
Speaker 2 (35:21):
Taking a look at markets as we head towards the
top of the hour, the Dow is down three hundred
and forty eight points, S and P down thirty two,
and Nasdaq down twenty three, So a pretty sharp intr
day reversal from what had been a nicely positive open.
So market's kind of following the same playbook that they
did yesterday and on Tuesday, where they've slid from the
(35:42):
open in a fairly meaningful fashion. We'll see what the
afternoon brings us, but to this point, not really a
great day of trading so far. As we head towards
the middle of the day tomorrow, we got the jobs
report coming out at eight thirty eight m folks, we're
gonna be here. We'll break it all down for you.
Make sure you tune in tomorrow on the Financial Exchange
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(00:20):
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(01:04):
by Veterans Development Corporation. This is the Financial Exchange with
Chuck Zada and Mike Armstrong.
Speaker 2 (01:12):
Chuck, Mike and Tucker with you here, and we've got
a market that can't make up its mind where it
wants to go. The Dow is down one hundred and
seventy three points, the S and P is down ten.
The Nasdaq, though, is up fifty three. So again kind
of just chopping around now after you know, a day
of excitement where we fell a couple percentage points to
start the week. The ten year US Treasury is down
(01:36):
one base no, it's one, down one tenth of a
basis point now. Uh and is sitting at three point
seven six seven percent. Oil West Texas Intermediate is up
a dollar thirty two barrel to seventy dollars and fifty
two cents. The triple A national averageur gas price is
continuing to slide, though, down another nine tenths of ascent
overnight to three point thirty and eight tenths of ascent.
(01:59):
Nice to see getting down into the low threes as
opposed to the mid threes where we spent most of
the summer, and gold we've got up fourteen dollars and
twenty cents announce right now to twenty five one hundred
forty dollars and twenty cents.
Speaker 3 (02:15):
Tomorrow we have the jobs report coming out Chuck at
eight thirty, and I guess I'm just wondering, are we
finally back to the point where bad news is bad
news again?
Speaker 2 (02:24):
Not necessarily right, I do really wonder.
Speaker 3 (02:27):
I mean to me, if you see the unemployment right
jump to four and a half percent, I'm very concerned
about imminent recession. But I'm also pretty sure the Fed
might do a fifty bit cut in that case.
Speaker 2 (02:37):
There are three possibilities here tomorrow. The first is that
you get bad news and it's viewed as bad news,
in which case the market pops is the technical term.
The second is that the market views bad news is
good news because of what you just outlined, and the
market says, oh, well, the Feder'll rescue us and we'll
be fine. The third is that good news is viewed
as good news and the market rallies on that. There
(03:01):
is no scenario in which good news is viewed as
bad news, because the only way it would be is
if inflation. We're still a question and there is literally
nothing out there right now that is pointing towards renewed
inflationary pressures at this point, yeah, one would think, no.
Speaker 3 (03:15):
That find me a data point right now. That's like,
I'm not matifation. I'm talking about how markets react to it.
Speaker 2 (03:22):
So, having said all that, if we get good news tomorrow,
the market is gonna sell off now, right.
Speaker 3 (03:26):
Because that's the only scenario that check didn't cover. So
this is where this is where we are.
Speaker 2 (03:32):
Uh. There's a piece in the bloomy Berg today. It's
titled cheering the yield curve not so Fast. And here
is what happened to yesterday. The yield curve it uninverted, Micael,
who cares? What does that mean? What it means is
that the yield curve is no longer upside down? Okay,
what does that mean? It means that I'm trying to
(03:52):
draw this out as much as possible. Uh. The two
year Treasury rate for a very brief period of time
went back below the ten year TIS rates Okay, which
is where it normally is during a typical market environment.
Speaker 3 (04:05):
Logically makes sense if I'm going to loan somebody money
for two years, I would expect a lower interest rate
than if I were to loan some of that same
person money for ten years.
Speaker 2 (04:13):
It's been inverted for the last couple of years now,
largely because the FED had to hike interest rates in
order to get inflation down, or try to get inflation down.
Speaker 3 (04:22):
Which was historically fairly reliable recession indicator. When that yield
curve becomes inverted, recession to come. That's one of the
ones that people talked about for a long period of time.
Had some false positives, so not always reliable, but was
and logically kind of makes sense, right, if you're so
concerned about what's going to happen in the short term,
then you might be willing to give up return to have,
(04:43):
you know, guaranteed results for the long term, which is
kind of what you have when you have an inverted
yield curve. You're saying, now, I don't want the higher
payment in two years, I'd rather take the lower payment
for ten.
Speaker 2 (04:52):
So, with the yield curve uninverting again very briefly yesterday,
today we're back to being oh so slightly inverted. The
two year treasury is at three point seven eighty five,
ten years at three point seven six eight, so there's
a point zero one nine percent divergence between them. At
the moment, still you know, slightly inverted. But the question is, okay,
(05:16):
what does this mean? And unfortunately, in this case there
are fewer false positives because typically the uninversion of the
yield curve is a much more reliable predictor of impending
recession that also tends to happen much closer from a
(05:37):
time period standpoint.
Speaker 3 (05:39):
So what we are seeing right now, your point would
be what we are seeing right now has reliably in
fact called recessions more often where you have an inversion
and then it's slowly more reliably.
Speaker 2 (05:50):
Yes, it's still not something where you like set it in,
forget it in a bank on it, because there's nothing
like that in economics. It's it's not how it works.
It's not physics. If you go and look at the
data and Brent Donnelly pulled this data for me, well
you didn't pull it for me. He published it and
sent check a text. It did not get a text. Instead,
(06:14):
what you end up seeing is that for all of
the recessions dating back to looks like nineteen seventy eight.
I guess that's the data point the data period that
he looked at. You pretty much ended up with recession
within six months or so, if not if not already
being in recession, with basically three false positives. One in
(06:37):
nineteen ninety eight, which was when long term capital management
blew up, and the US did not in a recession
for two years. Two false signals in two thousand and six.
The US did not inter recession for two years there
as well, and other than that, it's basically been less
than six months and recessions started oy. Again, there are
(06:58):
false positives here, well, there are more unfalse positives true
positives as they're typically referred to, So it's it's something
to be aware of other things that you need to
pay attention to. Though on this first recession does not
inherently mean that stocks lose value over the course of
(07:19):
said recession. There are a number of documented recessions where
during the course of the recession the S and P
five hundred actually went up, so it doesn't simply mean
sell everything and go away. In some cases it does,
in some cases it doesn't. Next, the depth of the
recession does not predict how badly the market is impacted.
(07:40):
The two thousand and one recession fairly mild in the
broad scheme of things. Stocks got absolutely hammered because.
Speaker 3 (07:47):
They were valued through the roof, and the length of
time it took for them to recover was especially.
Speaker 2 (07:53):
Took decade, and so like the NASDAK didn't take like
fourteen years to recover back to where it was. So again,
the depth of recession does not equate to how badly
stocks do or how long it takes them to recover.
All of this is a fancy way of saying, even
if you knew that recession was coming, knowing the right
buttons to push in exactly when to push them is
(08:16):
a really complicated task, and most of us are not
equipped to do that.
Speaker 3 (08:21):
But you know why this all matters as a reminder.
When you are investing in the stock market, what you
are buying is the future earnings of publicly traded corporations,
and there's a price for that. Today that price is
pretty historically high in the twenties, meaning you're paying twenty
plus times the future predicted profits of corporations in the
(08:42):
United States for owning those companies. And the problem with
recession is that usually two of those things change, one
the price that people are willing to pay and to
the earnings that those companies are.
Speaker 2 (08:57):
Generating, yes, and they both changed negatively typically yes. So
this is where we stand today. Again, every investor is different. Again,
most of you listening like you've lived through recessions. Again,
there have been six since nineteen seventy eight. So if
you haven't lived through one, you literally had to have
(09:18):
been born three years ago. Yeah, you know, my one
year old has not lived through a recession. Four year
old has no no even there, born too late in
the year. So in any case, as you you know,
go through this. Remember when when you look at the
historical performance of equity markets, they don't take out the
(09:41):
recessions and say, hey, here's how we did otherwise. No,
like all that historical performance includes recessions. It includes the
bad times as well. And if you're not comfortable with
something that you own, you know as an equity holding,
going down in value, you got to rethink flash, you
(10:02):
got to rethink your ability to actually own equities, because
equities do go down. Sometimes, sometimes they stay down. Sometimes
sometimes you have a company, even like the best companies Amazon.
This is one that I ask people like an awful lot,
because I think it's a really great example. Here. Imagine
(10:22):
that you're an Amazon stockholder back, you know, right before
the tech bubble, and you say, look this Bezos guy, Man,
I really believe in him. He seems like a smart dude.
He's got having beat up Old Civic, he's got a
great haircut, Like I like everything about this dude. This
is gonna be the guy that this is gonna be
the guy. And then Amazon stock proceeds over the course
(10:45):
of you know, early two thousand through mid two thousand
and one to lose ninety five percent of its value. Oops,
are you the guy that sits there and says, no,
I'm still believing in it after that? Because even the
best companies like this, Is there any denying that Amazon
is one of the best companies in the world today,
(11:06):
it's kind of hard to kind of hard to deny that. Yep,
they fell flat on their face and were down, Like
if you had one hundred dollars invested in it went
down to ten. Are you really sticking with it? It's
tough for a lot of us to do that, but
that's what stocks can do. They get absolutely crushed. Sometimes
they continue and lose the rest. Yeah, sometimes this sea
(11:27):
is toyest. Sometimes you buy a pets dot Com instead
of an Amazon dot com and you're like, why didn't
I buy the other dot com? M I don't know,
I don't know.
Speaker 1 (11:37):
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(12:00):
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Speaker 2 (12:09):
Fascinating data from the Energy Information Administration and Federal Highway
Administration that is published in a Bloomberg piece today, and
the basic premise is this, if you look at Americans
over the last thirty years, right now, we're driving about
thirty five percent more miles than we were back in
(12:31):
ninety five. Okay. On the other hand, excuse me one second,
the essue thank you. The gasoline that we consume is
only fifteen percent higher than nineteen ninety five, so there's
been a divergence in miles driven versus gasoline consumption, as you.
Speaker 3 (12:50):
Would explore fuel efficiency and electric cars. All sorts of
stuff makes sense here, correct.
Speaker 2 (12:56):
The really interesting thing is since the twenty eighteen through
twenty twenty peer vehicle miles have still increased, We're now
at a new peak for vehicle miles traveled, gasoline consumption
down four percent from that peak. That is the interesting piece.
Speaker 3 (13:11):
The last three years twenty twenty one, twenty twenty two,
even twenty twenty three, to some degree I could discount
some people still were not traveling. We are now again
much higher on the miles travel than finally hitting this
uh seeming perhaps actual peak in domestic gasoline demand.
Speaker 2 (13:32):
Could this reverse?
Speaker 3 (13:33):
Yeah, I mean I could see it reversing at some
point if we really really get a year where the
economy is chugging along and people are hitting the road
even more.
Speaker 2 (13:41):
But I mean we're already there right.
Speaker 3 (13:43):
Miles traveled is up again compared to twenty eighteen, gasoline
consumption down, and this does add up with more and
more hybrid vehicles, with more and more evs hitting the road.
I know that we live in a unique part of
the country here in the Northeast, but not a day
goes by that I don't see several electric vehicles. Most
people don't live in the Northeast, right, agreed, Like I
(14:06):
know that this is different in Texas, but the adoption
of electric and hybrid vehicles, while slower than Ford and
GM and all the carmakers would have thought a few
years ago, is making a significant dent on gasoline demand,
which is not exactly a catastrophic scenario for the big
(14:28):
oil companies, but is a shift from something that's been Yeah,
we've been talking about peak oil demand for years, decades,
and we may, at least in the United States have
hit it on the gasoline.
Speaker 2 (14:40):
Side of things, at least right There are plenty of
other places where you say, no, we probably haven't. Jet fuel,
jet fuel, boat fuel, even diesels probably still on the uptick.
In the US, I would imagine you will get plastics demand,
and what you're seeing on that front that is not
showing any signs of abating. In fact, it's continuing to grow.
So this is not to say that oil as a
(15:03):
whole is necessarily you know, problematic, but more look, one
of the key drivers of oil demand historically has been
US gasoline demand. That is no longer a marginal driver
of increased activity, increased demand for oil.
Speaker 3 (15:20):
Never really thought about this significantly, But wouldn't electric boats.
I know that the whole company called Electric Boat that
makes submarines, But electrified boats be a really low hanging
fruit segment, right, You're not taking road trips on American
boats generally speaking, Like everyone that I know that owns
a boat uses it on a lake for a few
hours during the day and then parks it back at
(15:41):
their dock at night.
Speaker 2 (15:43):
Few problems. The first is weight yep, batteries are really heavy. Yep.
The second is electricity and water generally don't mix great. True,
So you end up problem there. You end up with
some problems there.
Speaker 1 (15:56):
Yeah.
Speaker 2 (15:56):
And if you know anything about owning a boat, it's
really hard to keep water out of all parts of
the boat permanently. Yeah, as much as you try, Like,
there's always little things that happen in this and that. Okay,
dumb idea. I don't know who that's dumb, but it's
there's problematic stuff there, And I don't know. The boat
demand that creates most of the demand for fuel is
(16:19):
not people going out on Winnipesaki, right, it's boats going
through the Suez Canal. And getting stuck.
Speaker 3 (16:27):
Yeah, yeah, yeah, the diesel demand is a little bit
more significant then.
Speaker 2 (16:31):
For a stuck boat, demand for fuel is pretty low.
But for unstuck boats.
Speaker 3 (16:36):
Yeah, they burn a fair bit of that. From what
I understand, it's it's high.
Speaker 2 (16:41):
Let's see today's piece. Today's piece that I just find
rather humorous from CNBC quote a supersized FED rate cut
this month could be very dangerous for market. Economist warrens Okay,
first of all, if there's actually something that's catastrophically wrong
with the economy, saying hey, we're just gonna move slowly
(17:02):
because we don't want to spook people ends up getting
you into a situation where you spook people because the
economy worsens because you didn't want to spook people. It's
very dumb. If you gotta cut fifty BIPs, you cut
fifty BIPs. If you don't have to cut fifty BIPs,
you don't cut fifty BIPs.
Speaker 3 (17:18):
Now, if the unemployment rate comes in at four point
two percent and the FED cuts rates by fifty BIPs,
then sure go ahead and write this article.
Speaker 2 (17:24):
Otherwise, just please stop. It's just look, what's more dangerous
for markets is the FED not doing the right thing
because they're worried about how it looks. Correct, they got
to do what they got to do. If they do.
Speaker 3 (17:39):
Cut it by fifty basis points at the next meeting,
then any and of all of us should take that
as a serious indication that the FED is very worried
about the state of the economy.
Speaker 2 (17:48):
Yeah. I think that's a fair a fair position to take.
Speaker 3 (17:51):
But don't talk about a potential mistake that they could
make before they even make a decision.
Speaker 2 (17:55):
You're gonna take a quick break here, and when we return,
we've got the trivia answer. And then in video, indicted
Boomberger said they had been subpoenaed by the DOJ and
video saying, nahuh we didn't.
Speaker 1 (18:11):
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Speaker 2 (18:34):
There's a PCE and CNBC today talking about a retirement
disconnect that is sweeping across multiple generations of Americans. What
is this disconnect?
Speaker 3 (18:42):
Michael, Well, it's between what retirees or eventual retirees want
out of retirement and what they think they'll actually be
able to accomplish. And I would make the argument that
this is not necessarily the worst disconnect to have. Yes,
I think when you survey Americans, most of them say, look,
I don't want to be working. I want to be
able to have time to travel extensively. I want to
(19:03):
be able to spend the majority of my time with
family on you know, relaxation and leisure activities. But when
you also ask them they think they'll actually be able
to do that, the answer by and large is no,
not really, And that's what you are finding in this survey. One,
I would argue that most people haven't done the actual
work to find out whether or not they can afford
(19:24):
to have the retirement lifestyle that they are looking for.
And two, nobody really knows long term how this all
plays out and where those expectations land. But my overall
point on this would be having a planning for the
worst and expecting for the best is probably the best
thing that you can do when it comes to your
(19:45):
overall retirement plan. But before any and all of that,
if you haven't actually spent any time looking into how
much it's going to cost you to retire, if you're
planning to relocate, where you're going to relocate to, what
the tax situation looks like, you're to downsize, what it's
going to cost you to do all of that. If
you haven't built out a plan to address any of
these things, then there's no possible way you can know
(20:08):
what sort of lifestyle you can afford to have in retirement.
It really does come down to individualized planning when it
comes to planning for that stage of life. And I
often tell people this, but in many cases, while the
work that you do for retirement in your thirties, forties,
and fifties is hugely impactful on your retirement, it's also
(20:32):
rather simple.
Speaker 2 (20:33):
It is.
Speaker 3 (20:34):
It's just how much can you afford to save stash
as much away in that retirement acount as possible in
most cases, and that's the best strategy to make. When
you get into your late fifties, sixties, and seventies, the
strategies that you employ are arguably less impactful on your
long term retirement, but are significantly trickier with a lot
more pitfalls.
Speaker 2 (20:54):
Yeah, I think it's something where again, ultimately I've said
this before, every single year you got to spend some
time working through this. It doesn't have to be you know,
days on end, but you work for two thousand hours
a year in a normal year. If you're not spending
(21:17):
five to ten hours a year, not a day, but
a year, like half an hour maybe an hour a
month trying to work on this stuff, you're doing all
that work at the service and one year, maybe hey,
prioritize getting to understand different retirement account types. The next
start to understand the investments inside your four to one
(21:37):
K or four or three B or other retirement plan.
The one after that, learn a little bit about social security.
Like you don't have to do it all at once,
but tackle one big topic a year and just spend
a few hours educating yourself about it, because then it
allows you to answer these questions, It really does.
Speaker 3 (21:56):
I know there's a lot of you listening right now
that you're either in this position or know somebody who
is you know, is facing down these questions doesn't know
how to address them.
Speaker 2 (22:07):
And I'm just.
Speaker 3 (22:07):
Here to say that I know, you know, putting your
head in the sand and delaying these decisions can oftentimes
be the most common solution, but it is the worst one.
And if you have these types of questions or concerns
and are trying to figure out how to plan for
your own eventual retirement, give the folks at Armstrong Advisory
Group a call offices throughout New England. We work with
(22:30):
our clients day in and day out to try and
solve these problems and address these concerns. The number for
the Armstrong Advisory Group eight hundred three nine three for
zero zero one. We offer free consultations all across New England.
Once again that number eight hundred three nine three for
zero zero one.
Speaker 1 (22:47):
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. I'm Strong may contact you to offer
investment advisory services.
Speaker 2 (23:03):
Mike in Vidia said yesterday that they were not subpoenaed
by the DOJ about an anti trust probe. This comes
on the back of a Bloomberg News report that they
had been subpoenaed by the DOJ I cannot imagine that
Nvidia is lying about this, because if there's one thing
that the SEC would frown upon, it's probably lying about
whether or not you were subpoenaed by the DOJ about
(23:25):
an anti trust probe.
Speaker 3 (23:26):
Probably, so I'm guessing that they are right. I would
also argue that the difference ultimately between a civil investigative
demand versus a subpoena, which seems to be some of
the divergence here, is probably not all. I mean, obviously,
a subpoena is likely more severe than a civical investigative demand,
(23:50):
but it doesn't change the fact that somebody at the
Department of Justice is researching potential anti competitive behavior by
a video that seems to be not really in question.
Speaker 2 (24:04):
Yes, it's not clear how far along that is, or
how serious it is, or whether it's actually going anywhere.
And the other thing that I think is interesting about this,
here's the part that's kind of interesting and confusing about
this to me. Two years ago, i think it was two,
(24:25):
the United States passes the Chips Act, trying to fund
semiconductor production in America, right yep. As part of that,
a big chunk of that money was pretty much earmarked
for Intel, saying hey, we want you to be kind
of the face of this. There are some going to
other companies as well for American production. I don't know
(24:46):
exactly how much was going to each company, but Intel
was a big chunk. I think it was like twenty
billion out of the sixty billion. And in that case,
the United States government said, hey, we want to basically
build like kind of an national champion company that is
going to be the face of American semiconductor production. An Intel.
(25:06):
Now that's also fallen flat on its face. And Intel
isn't doing very well, and it's questionable whether they're even
gonna end up perceiving all of the Chips Act money
because they are milestones they have to meet before they
do so. But the US government, this administration, the Biden administration,
said yeah, we're cool doing this. Now you've got Nvidia,
who is probably what Intel wants to be. You know, like,
(25:30):
I'm willing to bet that Intel wakes up most days
and it's kind of like, man, be nice to be them.
Speaker 3 (25:37):
I'm not sure the US government wants Intel to be that,
because the US government wants manufacturing, which in Vidia does
not do.
Speaker 2 (25:43):
They don't but You've got a company that is at
this point at least kind of thought of as like
the gold standard for AI chip development, and in a
very kind of adjacent area, the US government is saying, yeah,
we're okay with the National Champion franchise, and in this space,
(26:04):
it's hey, we're not sure if we are. And that's
troubling to me because it's kind of like, well, what
do you want me to do? So you want me
to get big but not too big?
Speaker 3 (26:14):
Well, I mean, if so, the rumor mill right, the
allegations against what has been happening in Nvidia, I don't
know that you want to ignore them entirely because the
allegations have been Look, if you are a company trying
to order our chips and you order from anybody else too,
We're not going to fill your order. It's kind of
(26:34):
the definition of anti competitive.
Speaker 2 (26:37):
Now.
Speaker 3 (26:38):
I don't know that the VIDIA has monopoly power in
the space, but I'm not sure you want to just
turn a blind eye to that either, because that does
kind of get in the way of you know, if
you're the United States government and you want to support
a domestic chip manufacturing space, you know, in Vidia telling
their customer or more competition in Vida, telling your customers, hey,
you can't buy from anybody else that might develop those
(26:58):
chips in the United States.
Speaker 2 (26:59):
It's but probably it's a fine line to try to navigate.
It is. Let's take a quick break here. When we return,
let's do a little bit of stack roulette.
Speaker 1 (27:09):
Breaking business and financial news first throughout the day only
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five star review. This is the Financial Exchange Radio Network.
Speaker 4 (27:33):
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Speaker 2 (28:07):
Mike, what do you got for me? For stack Roulette?
Speaker 3 (28:09):
Beyond Meat plans to launch a new steak alternative as
it focuses on health, And I'm here to say that, Look,
if you can't make your fake ground beef taste all
that great, then you're not gonna get there with a
fake steak, fake ribbi. Huh, Well, it's just not gonna
happen beyond that. There you go, You see what I
(28:31):
did there?
Speaker 2 (28:32):
Yeah? Yeah, here's the thing. What's the price point for
their their sausages and stuff? It's like two to three
x the regular price. I don't know if it's quite there,
but yeah, it's at least two x. Yeah, it's not cheap.
So so what are you gonna be charging for these
you know ribbis?
Speaker 4 (28:46):
Like seeing something like that for the sausage?
Speaker 2 (28:49):
What's ninety nine for the sausages a three pack? So
what are you gonna be charging for the ribbi? Like
thirty five dollars a pounds? Gonna be waggedy price? What
am I doing here? On top of that as we've discussed,
going to look at the marbling and that fake piece
of meat. They say that they're leaning into health conscious
and I'm here to tell you, look, I don't know
(29:10):
the answer, but there's nothing about something being made from
plants that makes it inherently healthy. No one sits down
is like, you know what big bag of chips today
because they're plant based? What a healthy day?
Speaker 1 (29:23):
Like?
Speaker 2 (29:23):
No one does that. It's just just because something comes
from plants doesn't mean it's great for you. You know,
there's the whole you know, remember everyone's like trying to
cut out carbs, like the whole Atkins diet and this
and that. You know where most carbs come from, plants,
wheat you know, like just because it comes from what
(29:46):
is it like recycled p protein or something like that.
Speaker 3 (29:49):
Beyond us hoping to win over consumers who thought it's
products were too processed by trimming it's an ingredient list
and focusing it's Marcus marketing on the benefits of a
plant based diet. So it's going to I mean, I
don't think you put in all these processed ingredients because
you like using processed ingredients. It's probably to make it
taste as close to what you had it as as possible,
(30:10):
and so you're gonna make it taste worse and try
and market it as healthy. And I just if I
want to eat healthy, I'll just eat a vegetable.
Speaker 2 (30:19):
Right, I'll go have an apple, you know, I'll go outside.
I'll pull some oak leaves down and eat those and
call it a day. Can you what an oak leaves
taste like? Who eats oak leaves? I don't know. I
was just spitballing here. Again, things that you wouldn't want
to do just because they're plant based. Like, plant based
does not inherently mean it's great for you. Yes, if
(30:41):
you're getting an apple or a green pepper, you know,
a beat or something like that, it's fine. I'm much
more interested.
Speaker 3 (30:49):
Like the piece of the fake meat market that does
intrigue me is the lab grown stuff that they're trying
to do. They're like that stuff. I don't know if
it's gonna taste any good. I just find it fascinating
that they are actually try to replicate the cells of
actual meat in a lab without actually growing and slaughtering
an animal.
Speaker 2 (31:05):
Really, I think I think it's at least cool. And again,
it's it's not saying it's gonna be healthier. It's just no,
he grew this ribbi in a lab. Fine, I'll try
that once. This I don't know. I mean, yeah, enough
trouble mimicking the taste? Who said enough trouble making mimicking
the taste and texture of sausages and ground beef. It's
(31:27):
not gonna work with a steak. I just don't know
if it's gonna end up working with uh with the steak,
especially at the price point.
Speaker 3 (31:34):
It's tough enough for me to buy like a nice
ribbi in the first place. If it's twice the price
and is worse in quality, forget about it.
Speaker 2 (31:44):
Either of you excited for the new iPhone launch next week? No?
Speaker 4 (31:49):
No, although mine is really bugging out for me lately.
Speaker 2 (31:53):
What what are you running these days?
Speaker 3 (31:54):
He's got a bunch of iPhone Yeah, it's got an
so the tens what like five or six years old?
Speaker 2 (32:00):
It might be six, Yeah, somewhere in that ballpark. Are
you in the market for a new one? Or are
you just you know, still a wait? If anything? If anything,
it'd be like a fourteen years old, a generation or
two behind it.
Speaker 3 (32:12):
When do they stop supporting these like, is your iPhone
still getting updates?
Speaker 2 (32:16):
Tucker, Yes, So they got this new one that's going
to be coming out. And the big thing is they're
trying to really promote this as the first device that
is built for on device artificial intelligence. And I'm just
not sure how much of a selling point that's going
to be for people right now, just because here's the thing.
(32:39):
With all of the other stuff that Apple has been
able to sell really well, it's stuff that people didn't
know they wanted, but ultimately they did think about the
first one. It's hey, think about the iPod just as
an example, the selling premise was easy, it's all your
music in your pocket. Great, I get that. The iPhone.
(33:01):
Hey it's the Apple phone and your music's there, YadA, YadA.
And then they added everything on there the watch. Hey,
it's all your Apple stuff on your wrist. This with AI,
is there broad familiarity with how people actually use AI
on a daily basis? Now?
Speaker 3 (33:21):
No, But what if we get to the point where
Apple iPhone users are just far better at things like
talk to text and you know the Google Assistant type
questions that people frequently ask Siri, are.
Speaker 2 (33:35):
They like do Apple people use those more. I don't know.
Speaker 3 (33:39):
My point would be, if Apple's product is now significantly
better than all the competition in that space, is that
what does it right? Is that where it goes, is
that what makes it the desirable product compared to buying
the previous generation phone.
Speaker 2 (33:54):
I don't know. I just I'm done doubting Apple. No,
I'm not like they're gonna sell million, tens of millions
of these things like it's but I hear people talking
about this like, oh, this is gonna be a major
upgrade cycle because of AI, And I'm sitting there, I'm going,
does the average person care about AI yet?
Speaker 1 (34:13):
No?
Speaker 3 (34:13):
I think it takes a little bit longer than that.
And I also the downside to this that I don't
see is I can't tell by looking at the phone
from the exterior as to.
Speaker 2 (34:24):
Whether or not it's the latest and greatest.
Speaker 3 (34:26):
With the AirPods, with your watch, with many Apple products,
I've made the argument that the compelling case for owning
it is that it's a fashion symbol, it's a status symbol.
Speaker 2 (34:35):
It's you know, look at me.
Speaker 3 (34:37):
I have the latest and greatest Apple Watch, I have
the you know, the pro headphones, and I've got my
two thousand dollars iPhone, so you're not gonna be able
to really tell that there's some integrated software in here.
Speaker 2 (34:50):
Speaking of fashion symbols, have you noticed that after that
initial like one week of buzz, there are no videos
of people driving around in their Vision Pro helmets anymore?
Speaker 1 (35:00):
Hell out?
Speaker 2 (35:01):
Yeah, you know, the buzz just really didn't last long
on that one. Yeah. I hope they can that project.
I hope they build it into something that's interesting, but
it's you don't see anyone talking about it. It's not
on social media anywhere.
Speaker 4 (35:16):
At this point, it doesn't seem like there's buzz from developers.
Speaker 2 (35:19):
By the no.
Speaker 1 (35:20):
No.
Speaker 2 (35:21):
Taking a look at markets as we head towards the
top of the hour, the Dow is down three hundred
and forty eight points, S and P down thirty two,
and Nasdaq down twenty three, So a pretty sharp intr
day reversal from what had been a nicely positive open.
So market's kind of following the same playbook that they
did yesterday and on Tuesday, where they've slid from the
(35:42):
open in a fairly meaningful fashion. We'll see what the
afternoon brings us, but to this point, not really a
great day of trading so far. As we head towards
the middle of the day tomorrow, we got the jobs
report coming out at eight thirty eight m folks, we're
gonna be here. We'll break it all down for you.
Make sure you tune in tomorrow on the Financial Exchange
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