September 20, 2024 • 38 mins
Mike Armstrong and Paul Lane discuss the role politics plays into the Fed and their decisions. What are the latest economic proposals from the presidential candidates? Three Mile Island's nuclear plant set to reopen to power Microsoft's AI center. Will Amazon's new 'Shark Tank' style show be a hit? Pizza Hut will print job seekers’ resumes on pizza boxes and deliver to employers in ‘the toughest job market’.
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Episode Transcript
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Speaker 1 (00:00):
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by Veterans Development Corporation TODAS is the Financial Exchange with
Mike Armstrong and Paul Lane.
Speaker 2 (01:13):
Good morning, and welcome back to the Financial Exchange. We've
got markets in a broad but mild cell off Dow
off one fifth of one percent, seventy nine points, the
S and P off half a percent, the NASDAK off
two thirds of one percent after reaching new all time
highs yesterday following Jerome Powell's Federal Reserve decision to lower
(01:34):
interest rates by fifty basis points. Speaking of which, and
then we're going to be moving into some discussion about
presidential politics and you know, economic proposals coming from either party,
but drome Powell was asked the specific question that many
are asking, which is It came from Edward Lawrence from
(01:54):
Fox Business, and the question was, quote, how do you
respond to the criticism that will likely come that a
deeper rate now before the election has some political motivations
And certainly was something that Jerome Powell anticipated getting in
terms of a question, and not surprising that he did,
and he tackled it in the only way that I
think he could, which is, quote, so you know, this
(02:15):
is my fourth presidential election at the FED. And you know,
it's always the same. We're always going into the meeting
in particular and asking what the right thing to do
for the people we serve, and we do that and
we make a decision as a group, and then we
announce it and we and that's always what it is.
It's never about anything else. He goes on but effectively,
you know, attempting to convince people that, yeah, this is
(02:38):
not a political decision. I do genuinely believe that it's
not a political decision. Jerome Powell seems as though he
was a big leader and proponent for the fifty bases
point rate cut, he had to pull people along within
the Federal Reserve. You had one voting member disagree for
the first time since two thousand and five. And you know,
(02:58):
remember too, that this is a Donald Trump appointee who
made the decision to cut rates by fifty basis points.
You had Elizabeth Warren the day of the meeting criticizing
the FED, saying they needed to go big with a
seventy five basis point rate cut, which I think anyone
serious looked at and said that that's completely outrageous. And
you've had Donald Trump after the fact saying that it
(03:19):
was entirely political and the only cut rates to favor
Harris going into the end of the election.
Speaker 3 (03:25):
I mean, that's what's going to happen come November two.
Speaker 2 (03:27):
That's the politics of the FED. That is the role
that they will constantly have to navigate of attempting to
convince the American public that they are not persuaded by
political pressure one direction or another. And I think compared
to other institutions, I think they've done a fairly good
job of backing that up in terms of not not
(03:51):
falling victim to the political pressure from one party or
the other.
Speaker 4 (03:54):
No, I like to think that they act on what
we just talked about the first out of the show,
inflation in the l remark in and focus on their
three objectives rather than politics. That's the way it should be,
and I hope it is the case.
Speaker 2 (04:05):
So a few different pieces to cover here. One would
be new and additional proposals coming from Donald Trump's campaign
when it comes to tax reform. The other would be
some older stuff coming to what Kamala Harris has proposed
in terms of taxes for some of the wealthiest Americans
out there. I'll have to say that Whenever we talk
(04:28):
about Kamala Harris's proposals on what she wants to do
regard to the economy, it's honestly kind of tough because
they're usually not terribly specific. The proposals that we've seen
from Donald Trump are very clear, and you know, we've
criticized many of them. But like, I don't want taxes
on tips, I want to I want to eliminate the
(04:49):
salt deduction that were passed as part of my Like
you know a number of things that are really clear
in terms of what the policy would be, Kamala Harris
is quite less clear, and I think that's a reasonable
criticism of her is, hey, your campaign really has not
proposed much that is clear in terms of what your
policy would be would be. But one of the biggest
areas that I've that has been criticized when it comes
(05:09):
to Kamala Harris has been her proposals on unrealized capital gains.
And this would be very difficult to enact, very difficult
for the IRS to enforce. But there's effectively a proposal
out there that would require tax payers with wealth over
(05:30):
one hundred million dollars, which, again I don't know how
you go about measuring and reporting to report unrealized gains
for each asset class annually, including the basis to original
purchase price and the market value as of December thirty
first so, and then also reporting total liabilities. And the
(05:50):
idea would be that hypothetically, they could pass a rule saying, Okay,
this is your unrealized gain on something like a B business,
and we're going to tax you on that unrealized gain annually.
Unclear what the rate would be, but I mean, quite honestly,
we talk about taxes a lot on this show, and
(06:11):
this would be one of the proposals that would put
the United States as a global outlier in terms of taxation.
And those are the things that I get concerned about.
Right If we're finicking with the rate, you know, on
capital gains, whether it should be twenty or twenty five,
you know, we can have a realistic debate about what
that's going to do in terms of activity and investment.
(06:33):
When you talk about saying, hey, we're going to have
a new tax on unrealized capital gains just for people
with over one hundred million dollars, you start having questions
about where are people going to start relocating to it's
a very different conversation when you talk about something like that.
Speaker 4 (06:48):
I'm just not even sure I'm willing to have the conversation, Mike.
You know, I know it's it's something that we have
to bring up for the show, But I make that
point to say.
Speaker 2 (06:56):
Just because it's so unrealistic that it's ever going to happen.
Speaker 4 (06:58):
Administratively, it's an apple nightmare to be able to go
in and actually adhere to these potential policies. And then
I just can't get over that the biggest donors on
each side of the.
Speaker 3 (07:10):
Aisle are the people.
Speaker 4 (07:12):
Yeah, and I just call me a skeptic, but I
just don't think that you're gonna get the political push
when you've got billionaires who fund these campaigns so significantly
on the federal and local levels for different pointed off
officials that are gonna go for this. I just don't
(07:32):
think it's even really feasible to talk about until we
get a sweep in the sweep in Congress and Kamala
Harris in and like, all those probabilities together just aren't
high enough yet for me to go down this road.
Speaker 2 (07:44):
Yeah, I'm with you. This is of the economic policies
out there. One of the most extreme changes that has
been proposed that's been put out there on the Trump side.
We've talked about a number of them that have been
tossed out there. Some of the new ones are sort
of a dismantling of his own tax reform from twenty eighteen,
which is just again, it only makes context. It only
(08:08):
makes sense in the context of trying to buy votes.
I think is kind of where I land out.
Speaker 4 (08:12):
This is like the middle school class president saying I'll
get you guys free lunch and you know, recess and
stuff like that.
Speaker 3 (08:18):
It's just saying things that ultimately in middle.
Speaker 4 (08:21):
School you're like, yeah, I'd love to like have a
couple extra resis like, is that actually viable? Is that
actually something that is going to happen. All of these
endeavors seem a little bit misguided to me, that this
idea you'd be able to cap credit card rates, that's
not even on the tax side of things, but also
to repeal the Saal tax, the thing I got to
(08:44):
give him credit for. It's a very simplified tax system
that was incorporated in from the Tax and Jobs Cut
Act in twenty.
Speaker 2 (08:52):
Seventeen, seventy eighty percent of Americans are now not itemizing
their taxes.
Speaker 4 (08:56):
And it's really easy to fall it's it's been simplified greatly,
and I do think that along with lower marginal rates,
it's been a bit It's hard to argue that it
hasn't been a benefit to the economy over the last
you know, eight or nine years that it's been In.
Speaker 2 (09:10):
The original Trump tax reform, correct.
Speaker 4 (09:12):
You know, has every dollar gone to economic progress or
GDP grew up? No, absolutely not, That's not how it
goes with tax cuts. However, you can make the argument
that it certainly has been beneficial to the economy in
general from a deficit death side of things. That's a
whole nother conversation, but it is something that I do
think was was fantastic the way it's worked out.
Speaker 2 (09:31):
So the most recent proposal was at a campaign speech
in Long Island over the last week to restore the
salt deduction.
Speaker 4 (09:39):
Interesting where the location of that campaign you know meeting
was too the ultimate beneficiary of something like that being repealed.
Speaker 2 (09:45):
Yeah, So, I mean, if you need a sense for this, again,
if you're not familiar up until the Trump tax cuts, previously,
residents of states that had over ten thousand dollars of
state and local taxes. That's where the acronym salt comes from.
So income tax, property tax, sales tax. Add all that up.
If you could deduct it, then you would be able
to and that was capped during the Trump tax cuts
(10:09):
at ten grand. Yes, so you know, millionaires and billionaires
in places like New Jersey and Connecticut saw a massive
tax increase, not quite because you had, you know, the
corresponding cuts, but compared to other states where hey, you
didn't have as much taxes, and say state like Texas
or Florida, you had a potential to save a whole
(10:30):
lot more by moving there, and a lot of people
did relocate from places. You know. I remember one billionaire
in New Jersey leaving the state and ended up costing
the state of New Jersey something like ten percent of
their total tax revenue. This would again, if you're going
forward with this change one. You know, let's talk about
(10:51):
the fact that you're just running up deficits further. But
who are you benefiting. You're benefiting the highest income receivers
in states like Massachusetts, like New Jersey, like New York,
and also complicating the tax code even Further, I'm generally, again,
as much as I hated being here in Massachusetts where
I can't deduct all that stuff, and I would love
(11:12):
to get this back, I think it kind of made
sense if you're trying to propose tax policy like you
did and washing it away, I don't think benefits anyone
other than you know, millionaires in those high income tax states.
Speaker 5 (11:24):
Yeah.
Speaker 4 (11:24):
The one last thing I'll add there is that I
didn't wasn't even think about the city tax. That is
a huge deduction that if you work in Manhattan, for example,
that's a ten percent local tax that you're assessed if
you're a high income earner there. That in addition to
your property taxes wherever you live, New Jersey or whatever,
it's a huge bump. So it's something that those states
really benefited from in twenty sixteen, but not over the
(11:46):
last eight or ninety eight years.
Speaker 2 (11:47):
Let's say a quick break. When we come back. Trivia
for you next on the Financial Exchange.
Speaker 1 (11:52):
Tune in for trivia brought to you by Applebee's every
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(12:13):
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Speaker 6 (12:23):
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We're prohibited dine in only well. Earlier this week, Eminem's
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Jelly is the latest flavor from M and M's and
will hit store shelves starting in December. Original M and
MS began being produced back in nineteen forty one. Thirteen
years later, they introduced their first alternative flavor. Trivia question today,
(13:06):
what was the first alternative flavor for Eminem's once again.
What was the first alternate flavor for of Eminem's excuse me?
Be the sixth person today to text us at six
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Shaninshow dot com?
Speaker 2 (13:40):
Is Ben working today? Tucker?
Speaker 3 (13:42):
Yes?
Speaker 2 (13:43):
Okay, then Ben, I know you're listening. Ben. If you're
you know listening to the show, is the one that
comes up with I believe all of our trivia unless
he's out for a prolog period of time. I challenge you,
Ben to come up with only candy trivia for the
entire month of October.
Speaker 3 (13:58):
Ooh, that is fitting. Yeah, could be a spooky topical.
Speaker 2 (14:03):
I think I think you could pull it off. In
either case, I want to let everybody know that the
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(14:24):
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At the Margarita Margaritaville Hotel and Resort in Hyannas on
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(14:45):
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get a free meal out of it. We'll be talking
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year after elections and the most likely policies that might
(15:07):
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Speaker 1 (15:53):
The proceeding was paid for by Armstrong Advisory Group, a
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Speaker 2 (16:08):
The Nuclear Power Plant for the last remaining reactor on
three Mile Island was shut down in twenty nineteen due
to the cost to run the power plant and the
prices they were getting for the energy. According to a
reportment the Wall Street Journal, Constellation Energy, who owns the plant,
would be firing it back up here for one customer.
Speaker 3 (16:31):
It's a big one, though.
Speaker 2 (16:32):
It's a big one. Microsoft will be buying the electricity
generated by the nuclear power plant entirely, presumably for their
artificial intelligence computing that takes up, as we all know now,
an absolute ton of electricity. And this is interesting. This
is the first real evidence we are seeing of the
impact on the utility market and what might be coming
(16:54):
in the future. For all of this obviously a bit
of a different case because you have an existing nuclear
power plant, not something that needs to be constructed new,
but it does. I mean, let's think about just plain
old economics here. What's happened kind of overnight, but really
over the last couple of years is a creation of
(17:16):
a whole bunch of new demand for electricity. To my knowledge,
there's very little new supply that has been coming on
the market, and so what I would generally anticipate if
We're talking about companies like Microsoft and Google requiring a
whole bunch of new electricity that they were previously not consuming,
and no new supply coming on. Granted, this specific story
(17:39):
speaks to new supply coming online, but this is pretty
limited supply and demand. Demand goes up, no new supply,
prices go up, sure, and I'm interested to see how
that plays out because this look electricity and net gas
and all of these costs that we use to heat
our homes cool our homes throughout the United States, They've
already gone up quite considerably, have pretty much every different
(18:02):
area of honome ownership, between insurance costs, mortgages, and everything else.
And this has the possibility, not necessarily how it will
go because it's a heavily regulated industry, but to drive
those costs up even further. That's my guess as to
the short term impact. Quite honestly, long term, I'm quite optimistic.
I think that long term, if you have these juggernauts
(18:23):
demanding electricity and really pushing companies to come up with
new forms of generation, I'm really hopeful that it could
mean a whole bunch of new nuke plants coming online
and more supply down the road, But in the short
term it does kind of give me pause and a
little bit of concern there.
Speaker 4 (18:41):
Yeah, the long term piece I am optimistic about as well.
If you're looking for more carbon free energy out there,
the best way that you're gonna get innovation is money
coming into those areas. And if you have people who
have basically unlimited pocketbooks like Microsoft and some of these others, Yeah,
trying to look at alternatives because they're not gonna be
(19:03):
well received. If they're pushing more demands on the grid,
it's gonna be a lot easier for them to push
this through if it's renewable energy.
Speaker 3 (19:09):
If these big companies are going.
Speaker 4 (19:11):
To make the capital outlays to do that, that will
cause more innovation in the space because there will be
nuclear power, pants or other forms of energy out there
looking to receive those dollars.
Speaker 2 (19:20):
So I'm just waiting for the story. I almost promise
you we will cover a story a few years from
now of another Texas blackout or something like that where
at the same time, Google's running all of their processors
and continues to AI computing. Just wait, it's going to
happen at some point, and that'll be a turning Point
quick Break. We'll have the Trivia Winter next.
Speaker 1 (19:43):
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(20:04):
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Speaker 6 (20:09):
Trivia question today was what was the first alternate flavor
of M and M's. That would be peanuts, and nineteen
fifty four, M and MS introduced their first alternate flavor, peanuts.
Starting in December, there will be fourteen regularly available eminem
varieties in stores all across the country. Two winners two
and ounced today Whinever the Financial Exchange Show t shirt
(20:31):
was Levi from Claremont, New Hampshire, and the weekly winner
of the one hundred dollars gift card to Applebee's was
Joe from Sandwich, mass So congrats to both winners there
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(20:53):
the neighborhood board. We're prohibited dine in only.
Speaker 2 (20:56):
I know, we all just kind of become our own parents.
But I just think remember as a child, this relates
back to peanut Eminem's just being a bunch of like terrible,
rambunctious kids and my father trying to get all of
our energy out of us, and so he would give
us each a peanut eminem for every lap we ran
around the house. And I totally do that type of
(21:18):
thing with my kids these days. I just specifically create
activities for them just to get energy out of them and.
Speaker 6 (21:24):
Trump and then you get the sugar crash after, yeah,
which is not great.
Speaker 4 (21:28):
But again, how many laughs do you think Mike was
knocking out? No more than four or five?
Speaker 2 (21:33):
Excuse you. I was a very just kidd tiny athletic
young child. I just have changed a fair bit over
the years.
Speaker 1 (21:40):
Grew two inches.
Speaker 2 (21:41):
Yeah, yeah, I've grown a total of two inches since
I was ten years old. Amazon has a new TV
show out that again, the innovation coming out of this
company is always fascinating, but a new Shark Tank style
show that they're going to be putting on Prime presumably.
I assume they're not going to toss the thing on
(22:02):
Netflix or something like that. But what's the premise of
this new Shark Tank themed show that they're putting out here, Paul.
Speaker 3 (22:08):
So, basically, Mike what it is. It's called by it now.
Speaker 4 (22:12):
It's going to come out on October thirtieth, and it's
going to be a cross between kind of the Home
Shopping Network and Shark Tank, where contestants will come on
there with their inventions and pitch ninety seconds to the
audience as to why they feel that their invention should
be posted on Amazon, and then if the audience votes
that it is good enough or up to snuff, it
(22:33):
will go to a judge panel, which includes Tony Hawk,
Blackest star Anthony Anderson and actress Tabitha Brown. I hope
this is a rotating panel because I think you'd probably
want some people who are a little more business qualified, not.
Speaker 2 (22:45):
Like just so long as Tony Hawk is always yeah.
Speaker 3 (22:48):
I'm down with that.
Speaker 4 (22:49):
I am big, big Tony Hawk approval rating there. But
then ultimately the winner will get twenty thousand dollars if
they are the winner of the episode, and they will
also get the placement on Amazon's platform to be able
to sell their product globally.
Speaker 2 (23:04):
So I'm a huge What a dystopian world we're living
in where you go and like pitch your product on
a TV show sponsored by the largest retail almost the
largest retailer in the world, and the win is a
you know, for a business, a small amount of prize cash.
But then you get your item featured at the top
(23:25):
of a search bar on Amazon's website. It's just so
weird and dystopian. I would do, of course I would.
It's a huge I spend all my time shopping on Amazon.
Speaker 3 (23:34):
When you're saying dystopia, it's a huge coupe for the
business owners.
Speaker 2 (23:37):
Yeah, no it is. I mean it's a huge success.
If you're able to market this type of things, like
the preferred product on Amazon's web page right at the top,
you're going to kill it. I'm not just debating any
of this, it's just it just seems weird to me.
Speaker 3 (23:52):
Hey, the world changes.
Speaker 2 (23:53):
Yeah, it's uh, it certainly does. And yeah that that's
going to be Again. The part that's a little bit
weird too, is like you think about all the criticisms
from small business owners of Amazon over the years, like,
put my product out there and three months later it
tried the.
Speaker 3 (24:09):
Cutthroat their cutthroat. It's a they're a tough supplier to
deal with. Yeah, I guess that's what it's to deal with.
Speaker 2 (24:15):
That's the dystopian part of this is they're framing it
as you know, helping the mom and pops out there,
and if anything, Amazon has destroyed the mom and pops
of many different businesses over the last ten years. They
are just they have eaten everything. You think about all
of the you know, small hardware stores and and just
(24:36):
nick knack stores that Amazon has destroyed over the years.
That's that's the dystopian part of it, is like we
have just hollowed out small stores in American towns, and
now come on down so you can pitt your product
and we can put it on our website. Pizza Hut.
I talked about this the other day, how I really
like innovative ways for people to get their resumes twenty
(24:57):
four hours ago. Yeah, that's the other day. Now, the
other day is like two days ago. No, that's the
other day.
Speaker 6 (25:02):
Was the day in the past, No, yesterday was yesterday.
The other day is like a couple of days ago.
Alrighty break the tie here, Paul.
Speaker 2 (25:11):
I just think the other day is any day in
the past that's I think that's just the other day.
Is any day in the past that Mike can't remember.
Speaker 4 (25:18):
I think it's too aggressive, too aggressive, too aggressive to
come after him for that pizza hut.
Speaker 2 (25:25):
I don't know.
Speaker 3 (25:26):
I don't think it's aggressive.
Speaker 6 (25:27):
I'm just trying to feel like, Hey, the other day
sounds like it was Monday, yeah, or is twenty four
hours ago?
Speaker 2 (25:32):
I have been pretty notorious about not remembering which days
I talked about. Certa pizza hut will be printing job
seekers resumes on pizza boxes and delivering them to employers
in quote the toughest job market. Who's calling this one
the toughest job market? Again? I don't mean to, you know,
(25:53):
put my old man get off my lawn stump speech
out here, But anyone who lived through the twenty and ten, eleven, twelve,
and two thousand and nine job market, that was the
toughest job market. For anyone that's currently living there weren't
a whole lot of people that were entering the labor
force during the Great Depression. That one was worse. But
(26:14):
you know, for for people still alive today. This is
not the quote toughest job market. I'll put that aside
for a minute here, and and uh, you know, not
blame Pizza Hut for that one annoying or innovative Paul,
What do you think.
Speaker 4 (26:30):
How can they be assured that it's going to go
to the right hands of the employer? No, I how
do we know it's just not going to.
Speaker 2 (26:37):
Security guard at Morgan Stanley? Yeah?
Speaker 3 (26:39):
Yeah, right, Like, how do we know it's going to
get right hands? Yeah?
Speaker 4 (26:44):
I mean they could open up the box and by
the time the executives are getting to eat the pizza,
they can't even see the top of it. What executive
is running down? Oh the deliveries here, I got it?
Oh he got me Pezza, Tucker, I'll head down, I'll
grab the box.
Speaker 3 (26:58):
Right, that's the CEO of the company.
Speaker 2 (26:59):
Like, how I'm thinking that this may work on companies
that are thirty people or smaller, maybe fifty people are smaller.
You could get reliably, reliably good information to say, Okay,
the Armstrong Advisor Group's hiring. I've looked up their address.
They appear to be here. I'm gonna send them a
(27:19):
pizza with my red.
Speaker 6 (27:20):
So then we get eight pizzas a day here on
the lobby.
Speaker 2 (27:23):
Well, I'm right, but here's the thing.
Speaker 4 (27:25):
Think about who is usually the order of operations getting
the food, Like we get lunches on Fridays, usually send
out the youngest, most not tenured employee to do that task,
Like they're the ones behind the pizza pickup usually, so
how does.
Speaker 2 (27:40):
That get apply for their job?
Speaker 3 (27:44):
So they rip off the cover of the pizza.
Speaker 2 (27:46):
B Yeah, you know, Like I said, I'm I'm a
big fan of these innovative ways. We covered this one
the other day Tucker and Mistrum where this this guy
looking for a job in tech just posted It wasn't
his resume, but it was like his name, uh looking
for work and a QR code linking to his LinkedIn
profile and literally printed like hundreds of these things and
(28:09):
duct taped them to telephone polls outside of tech companies
in New York. And like I applaud the hustle, I
applaud the hustle. This one, I'm not sure how successful
it's going to be either as a sales stunt for
Pizza Hut or as a means for people getting jobs.
Speaker 3 (28:25):
So I guess I got us talking about people.
Speaker 2 (28:28):
I hope to be proven wrong. It's just because I'm hungry.
It's the only reason we landed here. I'm starving, so
I said, let's talk about the Pizza Hut story. Let's
take a quick break though. When we come back, paul
A Monica's joining us to round out our Friday show,
talking to us about PayPal. We'll be right back with
Paul after this.
Speaker 1 (28:45):
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Speaker 6 (29:12):
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Speaker 2 (29:45):
Joining us now is Paul Lamonica from Barons to talk
a bit about PayPal holdings. Paul as always, thanks for
joining us. Appreciate it.
Speaker 5 (29:53):
Yeah, thank you.
Speaker 2 (29:54):
So before we get into the new partnerships and what's
driving up the stock, you know, over the last month
or so, can you talk to us about just the
I mean, there's been a number of companies that have
fallen into this category. But it looks to me like
the company erased something like two thirds of its value
from the peaks back in twenty twenty one. What exactly
pumped this stock up so much? And then where did
(30:15):
it all go?
Speaker 5 (30:17):
Yeah? I think the big concern is that there is,
as you point out, a lot more competition for PayPal
and Venmo, which I think a lot of people probably
know the company most for. But when you think about
things now you can pay via Apple pay. You know,
Alphabet has a Google Pay of course, there's Block, which
(30:38):
is the owner of Square and cash app, and then
you have Stripe in the private area. You know, that
is you know, a company that is a competitor with
regards to mobile payments. And then finally, the big banks
themselves want a piece of this. They have a consortium
strangely called Early Warning Services that you know that that
(31:00):
is the consortium the don't zell and another new you know,
checkout type digital wallet service called pays pa Ze. So
there is a lot of competition. But PayPal has made
a bunch of partnerships in the past year under a
new CEO, and that's helping the stock recover.
Speaker 3 (31:19):
Yeah.
Speaker 2 (31:20):
So talk to us about those partnerships, and you know,
some of them read to me almost as Hey, these
big tech companies like Amazon are trying to push off
concerns about anti trust. Others are real, you know, genuine
inroads that they're making with big suppliers and and e
commerce websites. Where have they seen success recently?
Speaker 5 (31:39):
Yeah, I mean Amazon obviously the most recent announcement earlier
this week, that's a very significant one. You know, letting
customers use you know, paypals systems to buy products, certain
products on Amazon, So brands that use to buy with
Prime initiative, you know, that's something that you can have
(32:01):
PayPal now available at checkout. Prime members can link starting
next to year, Amazon accounts to their PayPal accounts. So
that is very very significant for PayPal. But the company
also doing some deals recently for its fast Lane guest
checkout service to try and boost growth, and that is
(32:24):
something that allows customers to easily access payment and address
information with their email only without entering the passwords. You
don't necessarily have to be a PayPal vemo. These services
don't have to necessarily be PayPal venmo friendly to allow
customers to use them. So they launched fast Lane earlier
(32:45):
this year and it's partnered with the European giant fintech
ad Yen, as well as buy Serve here in the US.
And then most recently, PayPal also did a deal with Shopify,
Canadian e commerce giant kind of similar to Amazon on
that makes PayPal one of the top online credit and
debtit card processors for Shopify payments in the US. So
(33:07):
you add all this up and it's very significant. These
are a lot of deals that you could boost the
PayPal network. Overall and by extension revenue and earnings.
Speaker 2 (33:19):
You point out that look, PayPal stock, it's out more
than fifteen percent in the past six months, outperformed both
the S and P and NASDAC during that time period.
I guess the question is, you know, clearly some excited
analysts out there about the business prospects. What allows PayPal
to distinguish itself in this space? I mean, coming from
an outsider perspective, I just have a tough time defining
(33:41):
why I would want to use PayPal over say Amazon
service or Google Pays service. Is it just a trust
thing with you know, people that have used PayPal for
for decades now, with you know its origins with eBay.
Speaker 5 (33:55):
Yeah, I think that is a big part of it.
And then obviously you know Venmo is b ill a
very popular peer to peer payment service, particularly with you know,
younger consumers millennials, gen z, but even gray bird gray
beards like like like me have a Venmo account and
(34:15):
use that pretty frequently easily pay people when I need to,
So that is something that I think is a big boost.
But at the bottom line is none of this would
matter if PayPal wasn't a historically cheap stock because it
had fallen so dramatically over the past couple of years.
Last track, it was trading for you know, a little
(34:36):
under fifteen times twenty twenty five earnings in you know,
and that is something that is just a giant discount
to its historical average of twenty six. So, you know,
this is a company that I think can continue to
do well.
Speaker 2 (34:53):
It's Paul Monica joining us to talk about PayPal and
the recent growth that they have seen. Always appreciate it, Paul. Thanks,
talk to you next week.
Speaker 5 (35:03):
Thanks alln How it going guys.
Speaker 2 (35:04):
Uh, The price war in weight loss drugs is apparently
showing up here, which we'll see what that means for
the big companies like Lily, who have seen tremendous stock
price growth over the last few months. But I don't
know about you, Paul, but I have because I've known
a few people that have gone on these drugs and
experience just kind of incredible results. The more and more
(35:26):
I look around and see people, I start wondering, like, oh, yeah,
I saw that person the other day and they seem
to have lost a ton of weight. And not that
it's any of my business at all, nor would I
ever ask but it starts automatically going through my head like, oh, yeah,
I wonder if they're I wonder if they're on the
uh the ozempics, and you know, seeing that weight loss
because of it, and doctors from what I have seen too,
(35:49):
clearly getting more and more comfortable with prescribing these things.
Speaker 3 (35:51):
Yeah, I did.
Speaker 4 (35:52):
It's interesting that this article comes up because I did
a deep dive listen to like a three or four
hour podcast on nover Nordice, and just the evolution of
this industry, which I thought was more of a newer industry,
but in a sense it's not just because Nova Noordis
has been doing insulin for over one hundred years and
this is evolving off of that. Where the GLP one
and semi glutide, which is basically the fulcrum for all
(36:15):
the weight loss efforts that you see, is something that
has been researched for over twenty years. The idea of
it coming on the public market, though, has surged significantly
over the course of the last couple of years. There's
been a lot of hate for weight loss drugs because
there's history of some bad actors out there, like Zenzen
and some others that had all sorts of dramatic impacts,
but for the most part here the science behind these
(36:38):
has not indicated any significant long term effects. There's some
concerns out there that some people one out of six
I believe I was quoted, have to drop out of
using these drugs. But they are really powerful. And the
thing that blew me away in listening to this podcast
was that there could potentially be other ways that these
could be beneficial for your overall health system.
Speaker 3 (36:58):
Beyond just weight laws.
Speaker 4 (37:00):
That these glp ones could reach other organs of the
body and have positive effects on the reducing heart risk
and other areas of other different body parts like liver
and kidney and others out there.
Speaker 2 (37:12):
So I have a close personal friend who maybe was
slightly overweight, but you wouldn't describe him as obese or
you know, you or generally fat. But you know, in
conversations with doctors and cholesterol concerns that they had, they're like, no, yeah,
I mean he's lost a ton of weight in addition
to you know, tackling a lot of his cholesterol issues. Yeah,
(37:35):
it's just been fascinating.
Speaker 4 (37:36):
So it circles back to this idea of if you're
Eli Ley and NorVa noticed. Those are the two players
in this space. It's pretty much those two that you
have to speak of. It does seem like there is
a price race to getting lower. But the thing that
I'll mention and here is that the demand for this
stuff far exceeds the supply. The supply piece is far
behind what the demand is because the demand is so rampant.
(37:58):
I mean, forty percent of this country sob so there's
a huge market for it and not enough supply there.
And the biggest thing to hit is Medicare. You gotta
get it Medicare approved.
Speaker 2 (38:07):
Markets remain broadly down across the board, Dow off one
fifth of one percent, SMP down a third of one percent,
and the Nasdaq down a little bit less than half percent,
So improving but still negative for the day. We'll have
a full market recap next week. Have a fantastic weekend, everybody,
and we'll see you back then.
The Financial Exchange is produced by Money Matters Radio and
is hosted by employees of the Armstrong Advisory Group, a
registered investment advisor. All opinions expressed are solely those of
the hosts. Do not reflect the opinions of Armstrong Advisory
or anyone else. Investments can lose money. This program does
not offer any specific financial or investment advice. Please consult
your own financial, tax, and estate planning advisors before making
(00:21):
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(01:04):
by Veterans Development Corporation TODAS is the Financial Exchange with
Mike Armstrong and Paul Lane.
Speaker 2 (01:13):
Good morning, and welcome back to the Financial Exchange. We've
got markets in a broad but mild cell off Dow
off one fifth of one percent, seventy nine points, the
S and P off half a percent, the NASDAK off
two thirds of one percent after reaching new all time
highs yesterday following Jerome Powell's Federal Reserve decision to lower
(01:34):
interest rates by fifty basis points. Speaking of which, and
then we're going to be moving into some discussion about
presidential politics and you know, economic proposals coming from either party,
but drome Powell was asked the specific question that many
are asking, which is It came from Edward Lawrence from
(01:54):
Fox Business, and the question was, quote, how do you
respond to the criticism that will likely come that a
deeper rate now before the election has some political motivations
And certainly was something that Jerome Powell anticipated getting in
terms of a question, and not surprising that he did,
and he tackled it in the only way that I
think he could, which is, quote, so you know, this
(02:15):
is my fourth presidential election at the FED. And you know,
it's always the same. We're always going into the meeting
in particular and asking what the right thing to do
for the people we serve, and we do that and
we make a decision as a group, and then we
announce it and we and that's always what it is.
It's never about anything else. He goes on but effectively,
you know, attempting to convince people that, yeah, this is
(02:38):
not a political decision. I do genuinely believe that it's
not a political decision. Jerome Powell seems as though he
was a big leader and proponent for the fifty bases
point rate cut, he had to pull people along within
the Federal Reserve. You had one voting member disagree for
the first time since two thousand and five. And you know,
(02:58):
remember too, that this is a Donald Trump appointee who
made the decision to cut rates by fifty basis points.
You had Elizabeth Warren the day of the meeting criticizing
the FED, saying they needed to go big with a
seventy five basis point rate cut, which I think anyone
serious looked at and said that that's completely outrageous. And
you've had Donald Trump after the fact saying that it
(03:19):
was entirely political and the only cut rates to favor
Harris going into the end of the election.
Speaker 3 (03:25):
I mean, that's what's going to happen come November two.
Speaker 2 (03:27):
That's the politics of the FED. That is the role
that they will constantly have to navigate of attempting to
convince the American public that they are not persuaded by
political pressure one direction or another. And I think compared
to other institutions, I think they've done a fairly good
job of backing that up in terms of not not
(03:51):
falling victim to the political pressure from one party or
the other.
Speaker 4 (03:54):
No, I like to think that they act on what
we just talked about the first out of the show,
inflation in the l remark in and focus on their
three objectives rather than politics. That's the way it should be,
and I hope it is the case.
Speaker 2 (04:05):
So a few different pieces to cover here. One would
be new and additional proposals coming from Donald Trump's campaign
when it comes to tax reform. The other would be
some older stuff coming to what Kamala Harris has proposed
in terms of taxes for some of the wealthiest Americans
out there. I'll have to say that Whenever we talk
(04:28):
about Kamala Harris's proposals on what she wants to do
regard to the economy, it's honestly kind of tough because
they're usually not terribly specific. The proposals that we've seen
from Donald Trump are very clear, and you know, we've
criticized many of them. But like, I don't want taxes
on tips, I want to I want to eliminate the
(04:49):
salt deduction that were passed as part of my Like
you know a number of things that are really clear
in terms of what the policy would be, Kamala Harris
is quite less clear, and I think that's a reasonable
criticism of her is, hey, your campaign really has not
proposed much that is clear in terms of what your
policy would be would be. But one of the biggest
areas that I've that has been criticized when it comes
(05:09):
to Kamala Harris has been her proposals on unrealized capital gains.
And this would be very difficult to enact, very difficult
for the IRS to enforce. But there's effectively a proposal
out there that would require tax payers with wealth over
(05:30):
one hundred million dollars, which, again I don't know how
you go about measuring and reporting to report unrealized gains
for each asset class annually, including the basis to original
purchase price and the market value as of December thirty
first so, and then also reporting total liabilities. And the
(05:50):
idea would be that hypothetically, they could pass a rule saying, Okay,
this is your unrealized gain on something like a B business,
and we're going to tax you on that unrealized gain annually.
Unclear what the rate would be, but I mean, quite honestly,
we talk about taxes a lot on this show, and
(06:11):
this would be one of the proposals that would put
the United States as a global outlier in terms of taxation.
And those are the things that I get concerned about.
Right If we're finicking with the rate, you know, on
capital gains, whether it should be twenty or twenty five,
you know, we can have a realistic debate about what
that's going to do in terms of activity and investment.
(06:33):
When you talk about saying, hey, we're going to have
a new tax on unrealized capital gains just for people
with over one hundred million dollars, you start having questions
about where are people going to start relocating to it's
a very different conversation when you talk about something like that.
Speaker 4 (06:48):
I'm just not even sure I'm willing to have the conversation, Mike.
You know, I know it's it's something that we have
to bring up for the show, But I make that
point to say.
Speaker 2 (06:56):
Just because it's so unrealistic that it's ever going to happen.
Speaker 4 (06:58):
Administratively, it's an apple nightmare to be able to go
in and actually adhere to these potential policies. And then
I just can't get over that the biggest donors on
each side of the.
Speaker 3 (07:10):
Aisle are the people.
Speaker 4 (07:12):
Yeah, and I just call me a skeptic, but I
just don't think that you're gonna get the political push
when you've got billionaires who fund these campaigns so significantly
on the federal and local levels for different pointed off
officials that are gonna go for this. I just don't
(07:32):
think it's even really feasible to talk about until we
get a sweep in the sweep in Congress and Kamala
Harris in and like, all those probabilities together just aren't
high enough yet for me to go down this road.
Speaker 2 (07:44):
Yeah, I'm with you. This is of the economic policies
out there. One of the most extreme changes that has
been proposed that's been put out there on the Trump side.
We've talked about a number of them that have been
tossed out there. Some of the new ones are sort
of a dismantling of his own tax reform from twenty eighteen,
which is just again, it only makes context. It only
(08:08):
makes sense in the context of trying to buy votes.
I think is kind of where I land out.
Speaker 4 (08:12):
This is like the middle school class president saying I'll
get you guys free lunch and you know, recess and
stuff like that.
Speaker 3 (08:18):
It's just saying things that ultimately in middle.
Speaker 4 (08:21):
School you're like, yeah, I'd love to like have a
couple extra resis like, is that actually viable? Is that
actually something that is going to happen. All of these
endeavors seem a little bit misguided to me, that this
idea you'd be able to cap credit card rates, that's
not even on the tax side of things, but also
to repeal the Saal tax, the thing I got to
(08:44):
give him credit for. It's a very simplified tax system
that was incorporated in from the Tax and Jobs Cut
Act in twenty.
Speaker 2 (08:52):
Seventeen, seventy eighty percent of Americans are now not itemizing
their taxes.
Speaker 4 (08:56):
And it's really easy to fall it's it's been simplified greatly,
and I do think that along with lower marginal rates,
it's been a bit It's hard to argue that it
hasn't been a benefit to the economy over the last
you know, eight or nine years that it's been In.
Speaker 2 (09:10):
The original Trump tax reform, correct.
Speaker 4 (09:12):
You know, has every dollar gone to economic progress or
GDP grew up? No, absolutely not, That's not how it
goes with tax cuts. However, you can make the argument
that it certainly has been beneficial to the economy in
general from a deficit death side of things. That's a
whole nother conversation, but it is something that I do
think was was fantastic the way it's worked out.
Speaker 2 (09:31):
So the most recent proposal was at a campaign speech
in Long Island over the last week to restore the
salt deduction.
Speaker 4 (09:39):
Interesting where the location of that campaign you know meeting
was too the ultimate beneficiary of something like that being repealed.
Speaker 2 (09:45):
Yeah, So, I mean, if you need a sense for this, again,
if you're not familiar up until the Trump tax cuts, previously,
residents of states that had over ten thousand dollars of
state and local taxes. That's where the acronym salt comes from.
So income tax, property tax, sales tax. Add all that up.
If you could deduct it, then you would be able
to and that was capped during the Trump tax cuts
(10:09):
at ten grand. Yes, so you know, millionaires and billionaires
in places like New Jersey and Connecticut saw a massive
tax increase, not quite because you had, you know, the
corresponding cuts, but compared to other states where hey, you
didn't have as much taxes, and say state like Texas
or Florida, you had a potential to save a whole
(10:30):
lot more by moving there, and a lot of people
did relocate from places. You know. I remember one billionaire
in New Jersey leaving the state and ended up costing
the state of New Jersey something like ten percent of
their total tax revenue. This would again, if you're going
forward with this change one. You know, let's talk about
(10:51):
the fact that you're just running up deficits further. But
who are you benefiting. You're benefiting the highest income receivers
in states like Massachusetts, like New Jersey, like New York,
and also complicating the tax code even Further, I'm generally, again,
as much as I hated being here in Massachusetts where
I can't deduct all that stuff, and I would love
(11:12):
to get this back, I think it kind of made
sense if you're trying to propose tax policy like you
did and washing it away, I don't think benefits anyone
other than you know, millionaires in those high income tax states.
Speaker 5 (11:24):
Yeah.
Speaker 4 (11:24):
The one last thing I'll add there is that I
didn't wasn't even think about the city tax. That is
a huge deduction that if you work in Manhattan, for example,
that's a ten percent local tax that you're assessed if
you're a high income earner there. That in addition to
your property taxes wherever you live, New Jersey or whatever,
it's a huge bump. So it's something that those states
really benefited from in twenty sixteen, but not over the
(11:46):
last eight or ninety eight years.
Speaker 2 (11:47):
Let's say a quick break. When we come back. Trivia
for you next on the Financial Exchange.
Speaker 1 (11:52):
Tune in for trivia brought to you by Applebee's every
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(12:13):
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Speaker 6 (12:23):
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Shaninshow dot com?
Speaker 2 (13:40):
Is Ben working today? Tucker?
Speaker 3 (13:42):
Yes?
Speaker 2 (13:43):
Okay, then Ben, I know you're listening. Ben. If you're
you know listening to the show, is the one that
comes up with I believe all of our trivia unless
he's out for a prolog period of time. I challenge you,
Ben to come up with only candy trivia for the
entire month of October.
Speaker 3 (13:58):
Ooh, that is fitting. Yeah, could be a spooky topical.
Speaker 2 (14:03):
I think I think you could pull it off. In
either case, I want to let everybody know that the
Financial Exchange is hitting the road. We're gonna be out
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(14:24):
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At the Margarita Margaritaville Hotel and Resort in Hyannas on
October twenty fourth, we're also going to be guests, joined
by special guest Ed Lambert, who's the host of the
(14:45):
XTK Morning Show. Following the show, we will be doing
an educational lunch with the Armstrong Advisory Group, so even
get a free meal out of it. We'll be talking
about the upcoming presidential election, the economic policies coming from
both candidates, and just you know history what we have
seen from markets in the economy in election years versus
year after elections and the most likely policies that might
(15:07):
impact you when it comes to your portfolio and your
financial plan from the elections. Again. Two events, the first
one October eighth and Springfield at the MGM. Second twenty
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(15:28):
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Speaker 1 (15:53):
The proceeding was paid for by Armstrong Advisory Group, a
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Speaker 2 (16:08):
The Nuclear Power Plant for the last remaining reactor on
three Mile Island was shut down in twenty nineteen due
to the cost to run the power plant and the
prices they were getting for the energy. According to a
reportment the Wall Street Journal, Constellation Energy, who owns the plant,
would be firing it back up here for one customer.
Speaker 3 (16:31):
It's a big one, though.
Speaker 2 (16:32):
It's a big one. Microsoft will be buying the electricity
generated by the nuclear power plant entirely, presumably for their
artificial intelligence computing that takes up, as we all know now,
an absolute ton of electricity. And this is interesting. This
is the first real evidence we are seeing of the
impact on the utility market and what might be coming
(16:54):
in the future. For all of this obviously a bit
of a different case because you have an existing nuclear
power plant, not something that needs to be constructed new,
but it does. I mean, let's think about just plain
old economics here. What's happened kind of overnight, but really
over the last couple of years is a creation of
(17:16):
a whole bunch of new demand for electricity. To my knowledge,
there's very little new supply that has been coming on
the market, and so what I would generally anticipate if
We're talking about companies like Microsoft and Google requiring a
whole bunch of new electricity that they were previously not consuming,
and no new supply coming on. Granted, this specific story
(17:39):
speaks to new supply coming online, but this is pretty
limited supply and demand. Demand goes up, no new supply,
prices go up, sure, and I'm interested to see how
that plays out because this look electricity and net gas
and all of these costs that we use to heat
our homes cool our homes throughout the United States, They've
already gone up quite considerably, have pretty much every different
(18:02):
area of honome ownership, between insurance costs, mortgages, and everything else.
And this has the possibility, not necessarily how it will
go because it's a heavily regulated industry, but to drive
those costs up even further. That's my guess as to
the short term impact. Quite honestly, long term, I'm quite optimistic.
I think that long term, if you have these juggernauts
(18:23):
demanding electricity and really pushing companies to come up with
new forms of generation, I'm really hopeful that it could
mean a whole bunch of new nuke plants coming online
and more supply down the road, But in the short
term it does kind of give me pause and a
little bit of concern there.
Speaker 4 (18:41):
Yeah, the long term piece I am optimistic about as well.
If you're looking for more carbon free energy out there,
the best way that you're gonna get innovation is money
coming into those areas. And if you have people who
have basically unlimited pocketbooks like Microsoft and some of these others, Yeah,
trying to look at alternatives because they're not gonna be
(19:03):
well received. If they're pushing more demands on the grid,
it's gonna be a lot easier for them to push
this through if it's renewable energy.
Speaker 3 (19:09):
If these big companies are going.
Speaker 4 (19:11):
To make the capital outlays to do that, that will
cause more innovation in the space because there will be
nuclear power, pants or other forms of energy out there
looking to receive those dollars.
Speaker 2 (19:20):
So I'm just waiting for the story. I almost promise
you we will cover a story a few years from
now of another Texas blackout or something like that where
at the same time, Google's running all of their processors
and continues to AI computing. Just wait, it's going to
happen at some point, and that'll be a turning Point
quick Break. We'll have the Trivia Winter next.
Speaker 1 (19:43):
Bringing the latest financial news straight to your radio. Every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
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(20:04):
is the Financial Exchange Radio Network.
Speaker 6 (20:09):
Trivia question today was what was the first alternate flavor
of M and M's. That would be peanuts, and nineteen
fifty four, M and MS introduced their first alternate flavor, peanuts.
Starting in December, there will be fourteen regularly available eminem
varieties in stores all across the country. Two winners two
and ounced today Whinever the Financial Exchange Show t shirt
(20:31):
was Levi from Claremont, New Hampshire, and the weekly winner
of the one hundred dollars gift card to Applebee's was
Joe from Sandwich, mass So congrats to both winners there
and Trivia is brought to you by Applebee's. Enjoy half
price late night appetizers after nine pm. Enjoying Club Applebee's
to enjoy exclusive deals and specials. It'll get a free
appetizer just for signing up. Now, that's eating good in
(20:53):
the neighborhood board. We're prohibited dine in only.
Speaker 2 (20:56):
I know, we all just kind of become our own parents.
But I just think remember as a child, this relates
back to peanut Eminem's just being a bunch of like terrible,
rambunctious kids and my father trying to get all of
our energy out of us, and so he would give
us each a peanut eminem for every lap we ran
around the house. And I totally do that type of
(21:18):
thing with my kids these days. I just specifically create
activities for them just to get energy out of them and.
Speaker 6 (21:24):
Trump and then you get the sugar crash after, yeah,
which is not great.
Speaker 4 (21:28):
But again, how many laughs do you think Mike was
knocking out? No more than four or five?
Speaker 2 (21:33):
Excuse you. I was a very just kidd tiny athletic
young child. I just have changed a fair bit over
the years.
Speaker 1 (21:40):
Grew two inches.
Speaker 2 (21:41):
Yeah, yeah, I've grown a total of two inches since
I was ten years old. Amazon has a new TV
show out that again, the innovation coming out of this
company is always fascinating, but a new Shark Tank style
show that they're going to be putting on Prime presumably.
I assume they're not going to toss the thing on
(22:02):
Netflix or something like that. But what's the premise of
this new Shark Tank themed show that they're putting out here, Paul.
Speaker 3 (22:08):
So, basically, Mike what it is. It's called by it now.
Speaker 4 (22:12):
It's going to come out on October thirtieth, and it's
going to be a cross between kind of the Home
Shopping Network and Shark Tank, where contestants will come on
there with their inventions and pitch ninety seconds to the
audience as to why they feel that their invention should
be posted on Amazon, and then if the audience votes
that it is good enough or up to snuff, it
(22:33):
will go to a judge panel, which includes Tony Hawk,
Blackest star Anthony Anderson and actress Tabitha Brown. I hope
this is a rotating panel because I think you'd probably
want some people who are a little more business qualified, not.
Speaker 2 (22:45):
Like just so long as Tony Hawk is always yeah.
Speaker 3 (22:48):
I'm down with that.
Speaker 4 (22:49):
I am big, big Tony Hawk approval rating there. But
then ultimately the winner will get twenty thousand dollars if
they are the winner of the episode, and they will
also get the placement on Amazon's platform to be able
to sell their product globally.
Speaker 2 (23:04):
So I'm a huge What a dystopian world we're living
in where you go and like pitch your product on
a TV show sponsored by the largest retail almost the
largest retailer in the world, and the win is a
you know, for a business, a small amount of prize cash.
But then you get your item featured at the top
(23:25):
of a search bar on Amazon's website. It's just so
weird and dystopian. I would do, of course I would.
It's a huge I spend all my time shopping on Amazon.
Speaker 3 (23:34):
When you're saying dystopia, it's a huge coupe for the
business owners.
Speaker 2 (23:37):
Yeah, no it is. I mean it's a huge success.
If you're able to market this type of things, like
the preferred product on Amazon's web page right at the top,
you're going to kill it. I'm not just debating any
of this, it's just it just seems weird to me.
Speaker 3 (23:52):
Hey, the world changes.
Speaker 2 (23:53):
Yeah, it's uh, it certainly does. And yeah that that's
going to be Again. The part that's a little bit
weird too, is like you think about all the criticisms
from small business owners of Amazon over the years, like,
put my product out there and three months later it
tried the.
Speaker 3 (24:09):
Cutthroat their cutthroat. It's a they're a tough supplier to
deal with. Yeah, I guess that's what it's to deal with.
Speaker 2 (24:15):
That's the dystopian part of this is they're framing it
as you know, helping the mom and pops out there,
and if anything, Amazon has destroyed the mom and pops
of many different businesses over the last ten years. They
are just they have eaten everything. You think about all
of the you know, small hardware stores and and just
(24:36):
nick knack stores that Amazon has destroyed over the years.
That's that's the dystopian part of it, is like we
have just hollowed out small stores in American towns, and
now come on down so you can pitt your product
and we can put it on our website. Pizza Hut.
I talked about this the other day, how I really
like innovative ways for people to get their resumes twenty
(24:57):
four hours ago. Yeah, that's the other day. Now, the
other day is like two days ago. No, that's the
other day.
Speaker 6 (25:02):
Was the day in the past, No, yesterday was yesterday.
The other day is like a couple of days ago.
Alrighty break the tie here, Paul.
Speaker 2 (25:11):
I just think the other day is any day in
the past that's I think that's just the other day.
Is any day in the past that Mike can't remember.
Speaker 4 (25:18):
I think it's too aggressive, too aggressive, too aggressive to
come after him for that pizza hut.
Speaker 2 (25:25):
I don't know.
Speaker 3 (25:26):
I don't think it's aggressive.
Speaker 6 (25:27):
I'm just trying to feel like, Hey, the other day
sounds like it was Monday, yeah, or is twenty four
hours ago?
Speaker 2 (25:32):
I have been pretty notorious about not remembering which days
I talked about. Certa pizza hut will be printing job
seekers resumes on pizza boxes and delivering them to employers
in quote the toughest job market. Who's calling this one
the toughest job market? Again? I don't mean to, you know,
(25:53):
put my old man get off my lawn stump speech
out here, But anyone who lived through the twenty and ten, eleven, twelve,
and two thousand and nine job market, that was the
toughest job market. For anyone that's currently living there weren't
a whole lot of people that were entering the labor
force during the Great Depression. That one was worse. But
(26:14):
you know, for for people still alive today. This is
not the quote toughest job market. I'll put that aside
for a minute here, and and uh, you know, not
blame Pizza Hut for that one annoying or innovative Paul,
What do you think.
Speaker 4 (26:30):
How can they be assured that it's going to go
to the right hands of the employer? No, I how
do we know it's just not going to.
Speaker 2 (26:37):
Security guard at Morgan Stanley? Yeah?
Speaker 3 (26:39):
Yeah, right, Like, how do we know it's going to
get right hands? Yeah?
Speaker 4 (26:44):
I mean they could open up the box and by
the time the executives are getting to eat the pizza,
they can't even see the top of it. What executive
is running down? Oh the deliveries here, I got it?
Oh he got me Pezza, Tucker, I'll head down, I'll
grab the box.
Speaker 3 (26:58):
Right, that's the CEO of the company.
Speaker 2 (26:59):
Like, how I'm thinking that this may work on companies
that are thirty people or smaller, maybe fifty people are smaller.
You could get reliably, reliably good information to say, Okay,
the Armstrong Advisor Group's hiring. I've looked up their address.
They appear to be here. I'm gonna send them a
(27:19):
pizza with my red.
Speaker 6 (27:20):
So then we get eight pizzas a day here on
the lobby.
Speaker 2 (27:23):
Well, I'm right, but here's the thing.
Speaker 4 (27:25):
Think about who is usually the order of operations getting
the food, Like we get lunches on Fridays, usually send
out the youngest, most not tenured employee to do that task,
Like they're the ones behind the pizza pickup usually, so
how does.
Speaker 2 (27:40):
That get apply for their job?
Speaker 3 (27:44):
So they rip off the cover of the pizza.
Speaker 2 (27:46):
B Yeah, you know, Like I said, I'm I'm a
big fan of these innovative ways. We covered this one
the other day Tucker and Mistrum where this this guy
looking for a job in tech just posted It wasn't
his resume, but it was like his name, uh looking
for work and a QR code linking to his LinkedIn
profile and literally printed like hundreds of these things and
(28:09):
duct taped them to telephone polls outside of tech companies
in New York. And like I applaud the hustle, I
applaud the hustle. This one, I'm not sure how successful
it's going to be either as a sales stunt for
Pizza Hut or as a means for people getting jobs.
Speaker 3 (28:25):
So I guess I got us talking about people.
Speaker 2 (28:28):
I hope to be proven wrong. It's just because I'm hungry.
It's the only reason we landed here. I'm starving, so
I said, let's talk about the Pizza Hut story. Let's
take a quick break though. When we come back, paul
A Monica's joining us to round out our Friday show,
talking to us about PayPal. We'll be right back with
Paul after this.
Speaker 1 (28:45):
The Financial Exchange streams live on YouTube. Like our page
and stay up to date on breaking business news all morning.
Long Base is the Financial Exchange Radio network business and
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it all straight from Wall Street right here on the
Financial Exchange Radio Network. Ladies and gentlemen the weekend.
Speaker 6 (29:12):
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Speaker 2 (29:45):
Joining us now is Paul Lamonica from Barons to talk
a bit about PayPal holdings. Paul as always, thanks for
joining us. Appreciate it.
Speaker 5 (29:53):
Yeah, thank you.
Speaker 2 (29:54):
So before we get into the new partnerships and what's
driving up the stock, you know, over the last month
or so, can you talk to us about just the
I mean, there's been a number of companies that have
fallen into this category. But it looks to me like
the company erased something like two thirds of its value
from the peaks back in twenty twenty one. What exactly
pumped this stock up so much? And then where did
(30:15):
it all go?
Speaker 5 (30:17):
Yeah? I think the big concern is that there is,
as you point out, a lot more competition for PayPal
and Venmo, which I think a lot of people probably
know the company most for. But when you think about
things now you can pay via Apple pay. You know,
Alphabet has a Google Pay of course, there's Block, which
(30:38):
is the owner of Square and cash app, and then
you have Stripe in the private area. You know, that
is you know, a company that is a competitor with
regards to mobile payments. And then finally, the big banks
themselves want a piece of this. They have a consortium
strangely called Early Warning Services that you know that that
(31:00):
is the consortium the don't zell and another new you know,
checkout type digital wallet service called pays pa Ze. So
there is a lot of competition. But PayPal has made
a bunch of partnerships in the past year under a
new CEO, and that's helping the stock recover.
Speaker 3 (31:19):
Yeah.
Speaker 2 (31:20):
So talk to us about those partnerships, and you know,
some of them read to me almost as Hey, these
big tech companies like Amazon are trying to push off
concerns about anti trust. Others are real, you know, genuine
inroads that they're making with big suppliers and and e
commerce websites. Where have they seen success recently?
Speaker 5 (31:39):
Yeah, I mean Amazon obviously the most recent announcement earlier
this week, that's a very significant one. You know, letting
customers use you know, paypals systems to buy products, certain
products on Amazon, So brands that use to buy with
Prime initiative, you know, that's something that you can have
(32:01):
PayPal now available at checkout. Prime members can link starting
next to year, Amazon accounts to their PayPal accounts. So
that is very very significant for PayPal. But the company
also doing some deals recently for its fast Lane guest
checkout service to try and boost growth, and that is
(32:24):
something that allows customers to easily access payment and address
information with their email only without entering the passwords. You
don't necessarily have to be a PayPal vemo. These services
don't have to necessarily be PayPal venmo friendly to allow
customers to use them. So they launched fast Lane earlier
(32:45):
this year and it's partnered with the European giant fintech
ad Yen, as well as buy Serve here in the US.
And then most recently, PayPal also did a deal with Shopify,
Canadian e commerce giant kind of similar to Amazon on
that makes PayPal one of the top online credit and
debtit card processors for Shopify payments in the US. So
(33:07):
you add all this up and it's very significant. These
are a lot of deals that you could boost the
PayPal network. Overall and by extension revenue and earnings.
Speaker 2 (33:19):
You point out that look, PayPal stock, it's out more
than fifteen percent in the past six months, outperformed both
the S and P and NASDAC during that time period.
I guess the question is, you know, clearly some excited
analysts out there about the business prospects. What allows PayPal
to distinguish itself in this space? I mean, coming from
an outsider perspective, I just have a tough time defining
(33:41):
why I would want to use PayPal over say Amazon
service or Google Pays service. Is it just a trust
thing with you know, people that have used PayPal for
for decades now, with you know its origins with eBay.
Speaker 5 (33:55):
Yeah, I think that is a big part of it.
And then obviously you know Venmo is b ill a
very popular peer to peer payment service, particularly with you know,
younger consumers millennials, gen z, but even gray bird gray
beards like like like me have a Venmo account and
(34:15):
use that pretty frequently easily pay people when I need to,
So that is something that I think is a big boost.
But at the bottom line is none of this would
matter if PayPal wasn't a historically cheap stock because it
had fallen so dramatically over the past couple of years.
Last track, it was trading for you know, a little
(34:36):
under fifteen times twenty twenty five earnings in you know,
and that is something that is just a giant discount
to its historical average of twenty six. So, you know,
this is a company that I think can continue to
do well.
Speaker 2 (34:53):
It's Paul Monica joining us to talk about PayPal and
the recent growth that they have seen. Always appreciate it, Paul. Thanks,
talk to you next week.
Speaker 5 (35:03):
Thanks alln How it going guys.
Speaker 2 (35:04):
Uh, The price war in weight loss drugs is apparently
showing up here, which we'll see what that means for
the big companies like Lily, who have seen tremendous stock
price growth over the last few months. But I don't
know about you, Paul, but I have because I've known
a few people that have gone on these drugs and
experience just kind of incredible results. The more and more
(35:26):
I look around and see people, I start wondering, like, oh, yeah,
I saw that person the other day and they seem
to have lost a ton of weight. And not that
it's any of my business at all, nor would I
ever ask but it starts automatically going through my head like, oh, yeah,
I wonder if they're I wonder if they're on the
uh the ozempics, and you know, seeing that weight loss
because of it, and doctors from what I have seen too,
(35:49):
clearly getting more and more comfortable with prescribing these things.
Speaker 3 (35:51):
Yeah, I did.
Speaker 4 (35:52):
It's interesting that this article comes up because I did
a deep dive listen to like a three or four
hour podcast on nover Nordice, and just the evolution of
this industry, which I thought was more of a newer industry,
but in a sense it's not just because Nova Noordis
has been doing insulin for over one hundred years and
this is evolving off of that. Where the GLP one
and semi glutide, which is basically the fulcrum for all
(36:15):
the weight loss efforts that you see, is something that
has been researched for over twenty years. The idea of
it coming on the public market, though, has surged significantly
over the course of the last couple of years. There's
been a lot of hate for weight loss drugs because
there's history of some bad actors out there, like Zenzen
and some others that had all sorts of dramatic impacts,
but for the most part here the science behind these
(36:38):
has not indicated any significant long term effects. There's some
concerns out there that some people one out of six
I believe I was quoted, have to drop out of
using these drugs. But they are really powerful. And the
thing that blew me away in listening to this podcast
was that there could potentially be other ways that these
could be beneficial for your overall health system.
Speaker 3 (36:58):
Beyond just weight laws.
Speaker 4 (37:00):
That these glp ones could reach other organs of the
body and have positive effects on the reducing heart risk
and other areas of other different body parts like liver
and kidney and others out there.
Speaker 2 (37:12):
So I have a close personal friend who maybe was
slightly overweight, but you wouldn't describe him as obese or
you know, you or generally fat. But you know, in
conversations with doctors and cholesterol concerns that they had, they're like, no, yeah,
I mean he's lost a ton of weight in addition
to you know, tackling a lot of his cholesterol issues. Yeah,
(37:35):
it's just been fascinating.
Speaker 4 (37:36):
So it circles back to this idea of if you're
Eli Ley and NorVa noticed. Those are the two players
in this space. It's pretty much those two that you
have to speak of. It does seem like there is
a price race to getting lower. But the thing that
I'll mention and here is that the demand for this
stuff far exceeds the supply. The supply piece is far
behind what the demand is because the demand is so rampant.
(37:58):
I mean, forty percent of this country sob so there's
a huge market for it and not enough supply there.
And the biggest thing to hit is Medicare. You gotta
get it Medicare approved.
Speaker 2 (38:07):
Markets remain broadly down across the board, Dow off one
fifth of one percent, SMP down a third of one percent,
and the Nasdaq down a little bit less than half percent,
So improving but still negative for the day. We'll have
a full market recap next week. Have a fantastic weekend, everybody,
and we'll see you back then.
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