October 8, 2024 • 38 mins
Chuck Zodda and Mike Armstrong wonder if today's tax credits will get more EV adoption in the US. For retirees, here’s what to do with required withdrawals when you don’t need the money. Will the US Gov't be successful in breaking up Google? Why is saving for retirement so difficult for younger generations. Americans are using AI at fairly high rates. What does this mean for the economy?
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Episode Transcript
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Speaker 1 (00:00):
The Financial Exchange is produced by Money Matters Radio and
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(00:43):
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(01:05):
Veterans Development Corporation. This is the Financial Exchange with Chuck
Zada and Mike Armstrong.
Speaker 2 (01:13):
Kick it off the second hour of the Financial Exchange.
It is Chuck, Mike and Tucker. We are broadcasting live
from the MGM Springfield in Springfield, and if you do
happen to be in the area, you can always pop
by and say hi. We are just upstairs of the casino.
Just take the escalator up to the second floor and
(01:34):
we are in one of the ballrooms there.
Speaker 3 (01:37):
But I've been out here before, right Chuck happened. I
drove out to the hotel last night, spent the night here.
Is my first time. I used to commute out to Springfield,
you know once, yeah, two or three times a month
and before this place is open and uh yeah, it's
a it's a pretty fun spot.
Speaker 2 (01:56):
I've been out a number of times and uh it
always delivers it. It's always just a great time. The
Dow Jones today is up forty four points, the S
and P up forty four as well, the NASDAK up
two twenty two. So we've got nice reversal happening today
on the S and P and Nasdaq. But the now
being dragged a little bit lower at the moment here,
not lower, but just lagging the performance of the other
(02:18):
two major indices. We've got oil today, we've got West
Text Intermediate now down three forty seven a barrel to
seventy three sixty seven. The TRIPAA National average four gas
prices moving up just to touch about seven tenths of
a cent from three seventeen and four tenths up to
three eighteen and one tenth overnight. It's just a little
(02:38):
bit of movement there. And we've got gold down twenty
four dollars and ninety cents an ounce to twenty six
forty one and ten cents. So this is a market
that right now, Mike, if we take a look just
at the last I don't know, a couple weeks or so,
we've just been chopping along, you know, the S and
P five hundred, It got above fifty seven hundred on
September nineteenth, after that FED meeting got it to about
(03:02):
fifty seven sixty, and we've just been chopping for the
last two weeks. Now. It's there's there's no clear direction
in this market, and I think it's just one that
is waiting for additional news in you know, a couple
of different fronts, certainly out of the Middle East and
what happens there. Have we seen, you know, the worst
of potential hostilities, direct hostilities between Iran and Israel or
(03:25):
is there more to come? Market also looking for hey,
is China going to be announcing additional stimulus? And then
we've got earning season kicking off. And this is all
before we even talk about you know, twenty eight days
from now, we've got a presidential election in the United States.
So there's you know, there's a lot that's on tap
here as we go through the next month or so
worth mentioning as well.
Speaker 3 (03:46):
After I think seven days of closure on Chinese mainland
Chinese stocks, the Shanghai Index reopened today closed up four
and a half percent, whereas the Hong Kong Exchange, which
had been opened during Golden Week in China, closed down
about nine and a half percent today on generally just
not enough stimulus announcements from the Chinese government.
Speaker 2 (04:09):
Let's talk a little bit about ev tax credits, so
part of the Inflation Reduction Act back in twenty two,
which had nothing to do with reducing inflation, correct, but
the everyone just loves to have these these names on bills.
I wish I could get to name a bill I
think would be fantastic, but they'll never love me in
either case. Sorry. The Inflation Reduction Act back in twenty
(04:30):
twenty two put in place a seventy five hundred dollars
tax credit for US made electric vehicles. There are baselines
that you have to meet as far as where the
components are sourced from, and this and that where the
batteries are produced. But it added this seventy five hundred
dollars tax credit. And i'll quote here from the New
York Times. The challenge in evaluating it is that the
policy has sometimes conflicting goals. One is getting people to
(04:51):
buy electric vehicles to lower carbon emissions and slow climate change.
The other is to strength in the US auto manufacturing
by denying subsidies to foreign companies even for better or
cheaper electric vehicles. So they say, look, it's kind of
confusing to sort this out. Researchers estimated that for every
additional electric vehicle the new tax credits put on the road,
(05:11):
about three other EV buyers would have made the purchases
even without the seventy five hundred dollars credit, so saying
most people are making the move with or without the credit.
That dilutes the effectiveness of the subsidies, which are forecast
to cost as much as three hundred and ninety billion
dollars through twenty thirty one. And the question we raised
(05:32):
this shortly after it was passed. Mark FANDETI and I
had you know, a long talk on the air about this,
where we said, look, if you know with absolute certainty
that the best thing to do in the world is
to build electric vehicles because they're the best way to
get around and they're the most efficient, and this is that. Okay, fine,
(05:55):
commit to doing this as policy. But who's this say
that five or ten years from now, we don't sit
there and say, gee, we've you know, figured out a
better way to do X, Y and Z, and now
we just spent four hundred billion dollars subsidizing a vehicle
that's now obsolete and we need to replace because hey,
the batteries take longer to degrade than we thought, or hey,
(06:18):
you know there's there's something out there that is better
for the environment.
Speaker 3 (06:22):
Like please, chuck, when was the last time you can
point to a government making a bad investment?
Speaker 2 (06:29):
Hold on, I got a file for this stuff to
take a look for a second. So I think these
are the problems that you run into here. Now, if
you want to say, look, we want to you know,
create incentives for manufacturing of X, Y or Z in
the United States, that's a different thing. But that wasn't
just that wasn't the key goal. We were specifically saying, no,
(06:50):
we need to make batteries and evs here because we
need them here, not being made somewhere else, and we're
spending four hundred billion dollars to do that. Now, you
and I have talked an awful lot, Mike, where hey,
I'm on board saying look, I don't know if the
Chips Act is gonna make any economic sense, but I
(07:12):
know we need to produce semiconductors here because there's a
real risk to national security and in the US, you know,
society as a whole if we can't source those here.
Same thing with medicines, with medical devices, with you know,
anything related to the military, Like, yes, you need to
build that stuff here in the United States. Do EV's
(07:36):
fit in any of those category? Like if if all
of a sudden tomorrow, if we snapped our fingers and said, hey,
there's no EV's produced in the US, and all of
your foreign suppliers have said they won't sell to you.
What does that do to US society? The answer is nothing,
not much. The answer is nothing. And I say this
(07:57):
my family, We we own an EV I likes. But
I can also understand why this doesn't make sense. Yeah,
I mean, I've struggled with that too.
Speaker 3 (08:08):
I don't think I want the Chinese making every car
that's sold in the United States. But not because I
worry about, you know, the drive train of a Chinese car,
which I would. I worry more about the technology that
goes into cars these days and the potential effect that
that would have.
Speaker 2 (08:26):
Right, don't track where I go. I only want American
companies tracking where I go.
Speaker 3 (08:29):
Look, I know plenty of this stuff is up for debate,
but I think the easier path would be to say, hey,
we have this externality that seems to be a problem,
which is let's say it's pollution, so let's try and
you know, let's try and fix the thing that we
have identified as the bad thing, rather than trying to
pick the winner, which was in this case electric vehicles,
which again I see how you get there. As the
(08:53):
Biden administration and what led them to that path. But
how do you determine that ev are seventy five hundred
dollars more valuable to society then Honda Civic that gets
forty miles per gallon or a hybrid that does something similar.
(09:13):
You are required to place values on this. I mean,
this would be political suicide, which is why it wasn't done.
But if this is the real problem that you have,
then implement a new gas tax. Yeah, it sounds fun. Again,
political suicide, you're not going to do it. But if
you're trying to really combat the problem and push people
into more fuel efficient vehicles, which is clearly what you're
(09:34):
trying to do is the Biden administration, here, make gas
costs four bucks a gallon. That'll do it pretty quick.
Take a quick break here.
Speaker 2 (09:42):
When we come back, we're going to do a little
bit of trivia on the financial exchange, and then we
got a couple of personal finance topics we're going to cover,
including why saving for retirement is or is not more
challenging for the younger generation. And then also if you
happen to in the middle of required minimum distributions, you're
(10:03):
getting towards the end of the year and you're old
enough that you have to take one. But what do
you do with a required minimum distribution if you don't
actually need a take it the money you will. Yeah, sure,
I don't think that was one of the options. Now
it was, But we'll take a quick break and then
we'll discuss that when we return.
Speaker 1 (10:21):
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So here we go.
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Speaker 2 (12:12):
Since twenty twenty three, most retirees have to take required
minimum distributions beginning at age seventy three that is scheduled
to you know, move to a later age.
Speaker 3 (12:24):
Age seventy five for some younger workers.
Speaker 2 (12:27):
Correct, But at this point it's age seventy three. So
let's say you're seventy three this year. If you have
a retirement account that is not in an employer sponsored
plan where you are active, you have that rm D
that you have to take. And in some cases this
works out great because the retiree says, perfect, I wanted
(12:48):
to take you know, three or four percent out of
my portfolio anyways to support my my lifestyle and retirement. Wonderful.
I'm just gonna do that, and then I, you know,
kill two birds with one stone. But occasionally you run
into someone who says, look, I've got enough income already.
I got Social Security, or I got a pension, or
(13:08):
I have you know, rental income from properties or whatever
it might be. Hey, I don't want to take this
money out, but I'm being told I have to. What
does a retiree do in that situation. I guess the.
Speaker 3 (13:21):
First thing would be, hopefully you're not already there, because
there's a lot you can do when you say sixty
five and a lot less that you can do when
you were already, when you were already seventy three and
finding yourself in this position. But believe it or not,
there are people out there who will end up paying
more taxes in their seventies than they did when they
were in their fifties and working, or in their eighties
(13:42):
when they were in their fifties when they were working
at a higher tax rate. Because of this, and with
a little bit of you know, forethought and planning in
your sixties, you can make a big dent on this
with a strategy that's become immensely popular over the last
decade or so Roth conversions. But you know a few
things that you Le's assume that you're not there, right.
Let's assume that you're already at seventy and you didn't
(14:03):
do the planning and you're now sitting there one not
necessarily too late, But you cannot, for example, take your
required a minimum distribution and toss it into a roth IRA.
Speaker 2 (14:14):
No, you're not allowed to do that. Get asked that
question a lot. You can't.
Speaker 3 (14:17):
They don't let you do that. You can go above
and beyond your required a minimum and put it into
a ROTH but you can't take that R and D
and put it there. A lot of folks end up
reinvesting some of their money, and it can be pretty
tax efficient to do so, but it ends up going
into a brokerage account or something along those lines. The
only real way that exists to avoid taxes on that
(14:38):
required minimum distribution is something called a qualified charitable distribution,
and that can be beneficial too, right if you're already
donating money to charity and you're writing it out of
your checkbook, for example, doing it from the IRA if
you're in your seventies can be a lot more tax efficient.
Speaker 2 (14:56):
Speak with a professional about that.
Speaker 3 (14:58):
Before you just go and blindly do it, because you
have to follow some rules about it. But that is,
you know, really the only one area that I can
feasibly look at to say, hey, this is one way
to avoid the taxes on your required minimum distributions. But
like I said, a ton that you can be doing
in your I don't hate to put a number on it,
but the between the stage sixties generally your sixties when
(15:20):
you are retired, but not yet seventy three or seventy
five for our older listeners out there, there is so
much planning that can be done, and the temptation and
the you know, most common practice for most people that
I speak to is, hey, I've retired now, so I'm
gonna start taking money out of my IRA to live
off of.
Speaker 2 (15:37):
And that is a common strategy.
Speaker 3 (15:38):
But for folks that might have other buckets of money
spent saved up, it can be a lot more efficient
to pull from different buckets in that in between stage
and really structure your tax situation differently to avoid that
giant tax bomb later in your seventies and eighties. And
like I've said, I have seen people who end up
paying bigger tax bills in their seventies and eighties, which
(16:00):
impacts things like your medicare premiums and all sorts of
things they didn't really plan for. In any case, I
know a lot of people are facing questions like this
or just starting to learn about required minimum distributions and
how they might affect you down the road. We at
the Armstrong Advisor Group would love to talk to you
about it. We've got offices throughout New England, We've got
(16:20):
folks on call that handle these types of questions that
affect retirees every single day, and we'd love to sit
down with you and talked about your personal situation, because
every single one of these is different. Some people have
a pension, some don't, social security, how much you'll have
versus how much you have in the IRA versus the ROTH,
or your four oh one K. If you have questions
like that, please give us a call at the Armstrong
(16:42):
Advisory Group at eight hundred three nine three four zero
zero one. Again, offices located throughout New England, but we
have clients across the country and be happy to speak
to you too. That phone number for the Armstrong Advisory
Group is eight hundred three nine three four zero zero one.
Speaker 1 (16:58):
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a registered investment advisor. Nothing in the ad or in
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Consult your own financial tax into state planning advisors before
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Speaker 2 (17:14):
Mike, there's a piece in Barons today. It's titled saving
for retirement is more challenging for younger generations. Here's why
do you buy it?
Speaker 3 (17:25):
Wow?
Speaker 5 (17:26):
Wow, Look as someone can buy homes now as someone
who is firmly in the millennial generation and eating avocado
toast every day.
Speaker 3 (17:38):
Let me tell you, there's people here watching you. They
can't you can't lie about it and say that you're
eating avocado co coast this morning. Okay, fair enough.
Speaker 2 (17:46):
Thank you. In any case, twenty years ago not twenty
fifteen years ago. During the Great Financial Crisis, there was
so much written about the millennials are never going to
be able to make it financially, They're going to be
scarred for life than not to be able to invest,
they won't be able to buy homes, blah blah blah,
blah blah. And if you look at the statistics now,
millennials are buying homes or have home ownership basically in
(18:08):
line with Gen X and the baby boomers at the
same respective ages. Just start a little bit later. They
just started a little bit later. And that's how it is.
If you look at net worth adjusted for inflation, it's
moved up in a similar fashion. And so I don't
deny that every generation has its own unique struggles that
they have to go through. And it's not to say
that every generation doesn't have hard things that they go through.
(18:30):
But when you read this piece, about Hey, saving for
retirement is going to be harder for this generation. Like
some of the stuff they say is they're like, hey,
for the last forty years, these were ideal years to
be invested, and markets are at record highs now, and
so future returns might not be as strong.
Speaker 3 (18:45):
So they're presuming that the markets are going to suck
for the next forty years with no base for we
have no idea what markets are going to do for
the next forty years.
Speaker 2 (18:52):
They might be better, they might be worse, they might
be the same, and just saying hey, valuations are high,
so this is going to be tough. Kind I'd also say,
you know, they were brought We're facing broad economic and
geopolitical landscape problems that were largely muted for the previous
generation when happened. Oh, I'm sorry the Cold War didn't exist.
We didn't go through Gulf War one, Golf War two,
(19:14):
nine to eleven, Afghanistan, right, Like, I mean, yeah, every
generation has their own unique struggles that they go through. Yes,
things are tough right now, but they've always been tough,
and so that's why this bothers me. With you quick
break here we get the trivia answer.
Speaker 6 (19:32):
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Speaker 4 (20:04):
Trivia question today was which color Eminem did blue replace?
Speaker 2 (20:10):
That'll be ten.
Speaker 4 (20:10):
In late nineteen ninety five, Eminem phased out the tan
colored Eminem's in favor of blue, which beat out pink
and purple in a nationwide vote. Winner today of the
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Speaker 2 (20:44):
Mike. There's a piece in the Financial Times today. It's
titled will Google be broken up, do you know?
Speaker 3 (20:53):
No, I don't think anybody but the judge knows. And
here it is today. The judge did receive the Department
of Justice high level remedies for Again, you have to
go back a few months here, but Google was found
to be a monopolist by a federal judge. So that's
already been determined. The extremely complicated part of this is
(21:13):
so what does that mean for Google?
Speaker 2 (21:15):
And nobody knows yet, and so the DJ is going
to deliver these, you know, remedies to the judge saying, hey,
here are the options that we have in terms of
what could happen. And it could be, look, you can't
sign agreements like you have with Apple to be the
exclusive search provider of you know, on the iPhone. It
could be that we have to break YouTube off from Google.
(21:38):
It could be we have to separate the search business
from the ad business. There's all kinds of different things
that could happen here.
Speaker 3 (21:45):
Given that this was primarily about search, it would seem
odd to me that they would say yeah, and so
as a result, we're stripping YouTube away from the rest
of Google.
Speaker 2 (21:54):
I don't know, wouldn't it just be kind of nice?
I would love it, but it's not.
Speaker 3 (21:56):
It just seems like it's not connected to the case
that here, which is primarily about search.
Speaker 2 (22:01):
True. So the uh, basically, these are going to be
delivered to the judge today and then you have a
hearing set for April, with the judge saying that they
are going to attempt to rule by August of next year.
So it still is going to be another ten months
or so at least potentially longer before we end up
understanding what might end up happen here end up happening here.
(22:25):
And remember this is the first major anti trust win
for the DOJ since Microsoft in two thousand. Yeah, tech
side especially Well again I say major, like, hey, they
stopped Staples and Office Depot from merging Spirit and jet Blue. Great,
Like you know, wow, now you know Staples went out
(22:46):
of business and Spirit's going to go out of business,
you know. So I think this is something that none
of us really know how this is going to play out,
because the precedent hasn't been set. Like there's a whole
generation that has never seen any kind of substantial anti
trust action against a tech company. And so we'll see
(23:06):
what ends up happening here. I will say, according to
people who were you know, more familiar with anti trust
law than I am, they have said that it would
be unusual to see, you know, a significant structural remedy
such as breaking up Google or spinning off its web
browser or something like that. But you might see the
(23:29):
DJ propose them just to say, hey, here's how far
we might want to go, and here's something lesser that
still might have some kind of substantial impact. It leads
me to a question.
Speaker 3 (23:37):
I mean, has sooner I had done a good job
the CEO of Google you compare him to, I mean,
certainly he's overseen Google among you know, some of its
most dominant years. It is a let's be honest, you
don't get sued for being a monopoly by being bad
at business. The entire reason you're getting it is because
(24:00):
you've become so dominant in the space that you play
in that you're being anti competitive and you are a monopoly.
So I acknowledge that, But part of your job is
also to make sure that you don't get sued by
the Department of Justice and forced to be broken up.
Speaker 2 (24:13):
Here and Google is.
Speaker 3 (24:16):
Now, you know, in a position where not only are
they facing these you know, anti trust concerns and potential remedies,
and a you know, successful lawsuit from the Department of Justice.
They're also facing a new threat from artificial intelligence that
quite honestly seems like the first legitimate threat to their
advertising business that we've seen in a couple decades.
Speaker 2 (24:37):
How do we define doing a good job? I hear
is the CEO of Google. Look, if you look just
at the stock price, but Chi came on in twenty fifteen,
when the stock was trading in the twenties. Today it's
one hundred and sixty four dollars in change. So from
a pure stock price perspective, like if you're a Google
shareholder over that time, not much to complain about it.
It's tough to be like, hey, I'm really upset, you know,
like things have been good. If you're talking about innovation,
(25:07):
I'm not sure there's anything there, quite honestly, yeah, I
mean he took a business that already had a model
and that was remotely interesting. That's extreme.
Speaker 3 (25:20):
But like for genuine, genuinely innovative I come up, I struggle.
Speaker 2 (25:26):
And and what's what's tough about that is Google. You
can make a case. During the tech bubble was one
of the most innovative companies. I mean, they were not
the first search engine on the block. They were like
the twelve thousandth but their algorithm provided better results, and
people flocked to it, and people people chose it. It
was It wasn't that Google imposed itself on people. People
(25:48):
that came later. People sought it, sought it out right,
and then Google said, well, now that you're here, we
want to make sure you can't leave. And and that's
why they're in the situation with the DOJ. So I
struggled to look at the last years of Google and say, hey,
what have they done from a product perspective that's really interesting?
I don't have anything. I mean, yeah, they've got their
(26:10):
you know, Waymo cabs that they're trying out, but they're
still in like two cities.
Speaker 3 (26:15):
They've got an entire healthcare division that, as far as
I know, has not done much in the way of
interest to my knowledge. Yeah, I mean, I think the
most compelling thing you can talk about is that they
have maintained market dominance for a much longer period of
time than I think most technology companies do historically, and
(26:37):
and they're being sued for that. So don't get me wrong.
Speaker 2 (26:40):
They're not like a bad company. I mean, they're well run,
they're profitable. But I don't know. Don't you want your
tech companies to come up with tech? I kind of do.
I kind of do. Speaking of tech, should we talk
about artificial intelligence? I was pretty fat.
Speaker 3 (26:59):
So there was a survey done that was we sometimes
talk about surveys and you're left questioning like what am
I supposed to do with this? And was this even reliable?
This was a big survey that was done based on
trying to get the same demographics as our census, and
they asked a few questions similar to what you ask
on the Census to really test Hey, was this a
(27:21):
good survey and did it correspond similarly to census questions
and answers?
Speaker 2 (27:25):
And the answer was yes.
Speaker 3 (27:26):
So it was pretty representative of the American public and
found I think some pretty surprising stuff in terms of
Americans' usage of artificial intelligence right now. So do you
want to rattle some of them off, Chuck?
Speaker 2 (27:37):
Yes. And this is as a study that was done
by the good nerds at Harvard. They looked at a
bunch of data and said, here's what we found based
on this survey and forty percent of Americans age eighteen
to sixty four have used Generative AI, so that would
be something like chet GPT correct and a sizeable percentage
(27:58):
they say seems to use it regular They found that
more than twenty four percent of American workers have used
it at least once a week in the you Know
survey period, and nearly one in nine used it every
work day.
Speaker 3 (28:13):
So that's ten percent of Americans are using generative AI
every single day for work.
Speaker 2 (28:22):
Now I'm someone I use it on that kind of
once a week basis occasionally more than that, but like,
I fit into that group, and there are certain things
for which it's really useful. There are also things where, again,
you poke around on it enough and you're like, okay,
I can't use it for this, or things where you
have to figure out how to train it in order
(28:43):
to do something that you want it to do because
it doesn't have the proper training to begin with, which
is kind of creepy but also kind of amazing at
the same time, because you basically tell it, hey, I
want when I ask you for X, here's how you
do it in order to spit out why, and then
it can actually do it and you don't have to
(29:04):
be a programmer. You don't have to know any kind
of coding. You just literally tell it like you're teaching
a dog or a child, or like even like anything.
Speaker 3 (29:12):
I tried to teach my dog how to do math
for years and it didn't work too well, but.
Speaker 2 (29:16):
Doing it wrong.
Speaker 3 (29:17):
I mean further, with this study found twenty two percent
of blue collar workers have used it and other than
personal services, so barber's, hairstylists, nail salons, workers, every other
major job category had seen at least twenty percent adoption
of generative artificial intelligence. I'm not saying this is universally
(29:38):
a good thing. By the way, I hope you don't
misunderstand me. There are massive potential pitfalls to all of this.
But I was quite frankly shocked by the headline number
that forty percent of Americans age eighteen to sixty four
have used AI in some way, shape or form.
Speaker 2 (29:57):
Generative AI now has been around for two years. Right,
show me one technology that was about technology has been
adopted by almost a quarter of all working people in
a two year period.
Speaker 3 (30:11):
I would hesitate to come up with one. Smartphone didn't.
Speaker 2 (30:14):
Smartphone took you know, probably five to seven years, I
will Internet. I mean, this is kind of wild stuff. Yeah,
and arguably depending on how it you know, social media.
Speaker 3 (30:25):
Social media might be the only one that I can
look at hardly a technology, but it might be the
only one I can look at to say that had
a very rapid adoption. But for us, yeah, even then,
I doubt it was forty percent of Americans eighteen to
sixty four with than two years.
Speaker 2 (30:43):
It's wild. Yeah. To take a quick break here. When
we return, it's time for a little bit of stack roulette.
Speaker 1 (30:51):
Business and financial news affecting the markets and your wallet.
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Speaker 4 (31:22):
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Speaker 2 (31:55):
Michael, what do you have for me for stack roulette?
Speaker 3 (31:58):
I want to talk about a new type of flation
thatation haven't discussed. We've talked about inflation, deflation, shrink flation.
What other flations have we have? We disinflation, disinflation, this
one is skimpflation that Whole Foods was accused of here,
and skimflation is, according to whoever coined this phrase, just
(32:23):
making a product cheaper and can I say crappier, just
generally worse at the at the behest of profit. And
Whole Foods saw some backlash on this, so I can't
say that I have frequently tried their berry Chantilly cake,
but apparently they shrunk it, replaced it with garbage ingredients,
made it a lot worse, and.
Speaker 2 (32:46):
Go ahead. This this piece says that it's an iconic
berry chantilly cake.
Speaker 3 (32:53):
I I think iconic a little bit extreme. But in
any case, what I liked about this is that people
got poed. They got really angry, and they started posting
about it on social media and whining about it and
complaining about it so much that Whole food said, forget it,
We're not doing that. We're going like over two days
(33:16):
they went and changed their policy on all this. And
what it reminds me of is that we actually, as
like consumers, do have some power over these companies that
sell us stuff all the time. Like if we actually
make a point of pushing back on this, well that
would be My point is Unfortunately that power seems to
be concentrated at wealthy households that shop at Whole Foods
(33:36):
rather than the general public.
Speaker 2 (33:37):
But no, the general public has this too. It's the
problem is that we just there are two problems. Either
A we just accept it or B the problems that
we see are in industries for which there is no
competition and so we can't do anything about it. Sure
see the airline industry. Hey, you're trying to fly to Austin, Texas. Great,
you got forty five Southwest flights and one flight from
(33:58):
United that'll get you there. And so you don't have
any alternatives in terms of, hey, I want more leg
room or this. No like that. There is no more
leg room because we're the only company that does this.
So this is one of the reasons why I'm so
adamant that we could get rid of an awful lot
of regulation when it comes to business practices if we
(34:23):
just had more competition. Yep, because stuff like this is
solved by someone saying, hey, you know what you're you're
making a bad cake. Great, I'm gonna get my cake
somewhere else.
Speaker 3 (34:31):
And Hohpefood's changed their mind rather quickly, right, Wholefood said, which,
good job. Whole Foods too, like, actually listen to your customers.
Speaker 2 (34:37):
Yeah. I give them credit for that, because it would
be easy to just be like, no, like, we've made
this change, and this is what we're sticking with because
a lot of times that is what you end up
hearing from companies is right.
Speaker 3 (34:46):
We are Amazon. We don't care about what you have
to say, so we're not going to change anything. You
have to keep Amazon, That's what I mean. Oh like
that you could see you can see them saying that, hey,
we you know, I understand that you're exact about your
Barrish Antilly cake, but we're Amazon. We don't care. But
they did. They actually went and switched it.
Speaker 2 (35:03):
I want to talk about pickleball piece of the Wall
Street Journal. The turf war between tennis and pickleball is escalating.
Speaker 3 (35:11):
So there are tennis courts right next to our office
where we usually do the program from today we're in Springfield,
but generally were speaking, we do the program from Needham.
There's tennis courts that are right next to our office
that for years were empty and now are packed with
pickleballers all the time. And it actually made like somewhat
regional news that somebody snuck in in the middle of
the night and took a knife to all all the
(35:32):
pickleball nets, which I just find so petty and hilarious.
But go on, the pickleball wars are real.
Speaker 2 (35:39):
I'll quote here on at least one front, there is
no longer denying that tennis and pickleball are in direct conflict.
The battle for court space has arrived and tennis is
losing ground fast. Today. The USTA says at least ten
percent of tennis courts in America have been taking over
and repurposed for pickleball. Quote, there are not enough courts
to support tennis growth, and court infrastructure is being comprom
(36:00):
with people playing pickaball on those courts or courts being repainted,
according to USTA chief Blue Share. Now, as someone who
you know, both skis and plays soccer in the US,
I understand, you know, niche sports that don't have you know,
a ton of following following in the United States. But look,
(36:23):
I go past tennis courts all the time, like just
driving around. It's rare to see them empty, except when
you actually have pickleballers in and then there's like forty
six pickleballers on each court. And so I don't buy
that there is a lack of courts that's restricting the
growth of American tennis.
Speaker 3 (36:41):
No, there's a lack of demand that's restricting the growth.
Speaker 2 (36:43):
Right, Americans just have not been playing as much tennis.
Speaker 3 (36:46):
I like tennis, I like I watch it occasionally. It's fine,
it's okay, not my favorite. Like this is a market
based problem. That is being solved by the markets. There
is a twenty one court pickaball complex opening up for
one hundred thousand square feet in the Natick Mall in
Massachusetts this month. They're going to have bars, restaurants like
(37:09):
they are solving this problem with market based solutions. And
I mean the problem is that tennis. Yeah, you are
the uh, the victim here of the growth of pickleball,
and it's going to come at your popularity. But sorry,
I don't know what you want me to do about it.
What do we want to do? Ban pickleball courts in
(37:29):
order to support plenty of places, well, not to support tennis,
but plenty of people have been banning pickleball courts because
they want to complain about the noise, which I find
to be hilarious. If you should see the noise coming
from the hockey rink when I play once a week,
is there a lot? Well, it's just far more offensive.
Speaker 2 (37:45):
Oh well, it's also indoors though true.
Speaker 3 (37:48):
You know.
Speaker 2 (37:48):
Taking a look at markets, as we had towards the
top of the hour, the Dow is up seventy two points,
the S and P's up forty six, the NASDAG up
two twenty seven, so all three major US markets in
positive territory to start the day. We'll see if they
finish the day there. Oil price is still falling today,
down three point fifty a barrel on West Text Intermediate
(38:09):
to seventy three sixty four. We'll see if we get
some follow through. If we continue to see no further
activity in the Middle East, we're done for the day.
We'll see you tomorrow on the Financial Exchange
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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(00:43):
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(01:05):
Veterans Development Corporation. This is the Financial Exchange with Chuck
Zada and Mike Armstrong.
Speaker 2 (01:13):
Kick it off the second hour of the Financial Exchange.
It is Chuck, Mike and Tucker. We are broadcasting live
from the MGM Springfield in Springfield, and if you do
happen to be in the area, you can always pop
by and say hi. We are just upstairs of the casino.
Just take the escalator up to the second floor and
(01:34):
we are in one of the ballrooms there.
Speaker 3 (01:37):
But I've been out here before, right Chuck happened. I
drove out to the hotel last night, spent the night here.
Is my first time. I used to commute out to Springfield,
you know once, yeah, two or three times a month
and before this place is open and uh yeah, it's
a it's a pretty fun spot.
Speaker 2 (01:56):
I've been out a number of times and uh it
always delivers it. It's always just a great time. The
Dow Jones today is up forty four points, the S
and P up forty four as well, the NASDAK up
two twenty two. So we've got nice reversal happening today
on the S and P and Nasdaq. But the now
being dragged a little bit lower at the moment here,
not lower, but just lagging the performance of the other
(02:18):
two major indices. We've got oil today, we've got West
Text Intermediate now down three forty seven a barrel to
seventy three sixty seven. The TRIPAA National average four gas
prices moving up just to touch about seven tenths of
a cent from three seventeen and four tenths up to
three eighteen and one tenth overnight. It's just a little
(02:38):
bit of movement there. And we've got gold down twenty
four dollars and ninety cents an ounce to twenty six
forty one and ten cents. So this is a market
that right now, Mike, if we take a look just
at the last I don't know, a couple weeks or so,
we've just been chopping along, you know, the S and
P five hundred, It got above fifty seven hundred on
September nineteenth, after that FED meeting got it to about
(03:02):
fifty seven sixty, and we've just been chopping for the
last two weeks. Now. It's there's there's no clear direction
in this market, and I think it's just one that
is waiting for additional news in you know, a couple
of different fronts, certainly out of the Middle East and
what happens there. Have we seen, you know, the worst
of potential hostilities, direct hostilities between Iran and Israel or
(03:25):
is there more to come? Market also looking for hey,
is China going to be announcing additional stimulus? And then
we've got earning season kicking off. And this is all
before we even talk about you know, twenty eight days
from now, we've got a presidential election in the United States.
So there's you know, there's a lot that's on tap
here as we go through the next month or so
worth mentioning as well.
Speaker 3 (03:46):
After I think seven days of closure on Chinese mainland
Chinese stocks, the Shanghai Index reopened today closed up four
and a half percent, whereas the Hong Kong Exchange, which
had been opened during Golden Week in China, closed down
about nine and a half percent today on generally just
not enough stimulus announcements from the Chinese government.
Speaker 2 (04:09):
Let's talk a little bit about ev tax credits, so
part of the Inflation Reduction Act back in twenty two,
which had nothing to do with reducing inflation, correct, but
the everyone just loves to have these these names on bills.
I wish I could get to name a bill I
think would be fantastic, but they'll never love me in
either case. Sorry. The Inflation Reduction Act back in twenty
(04:30):
twenty two put in place a seventy five hundred dollars
tax credit for US made electric vehicles. There are baselines
that you have to meet as far as where the
components are sourced from, and this and that where the
batteries are produced. But it added this seventy five hundred
dollars tax credit. And i'll quote here from the New
York Times. The challenge in evaluating it is that the
policy has sometimes conflicting goals. One is getting people to
(04:51):
buy electric vehicles to lower carbon emissions and slow climate change.
The other is to strength in the US auto manufacturing
by denying subsidies to foreign companies even for better or
cheaper electric vehicles. So they say, look, it's kind of
confusing to sort this out. Researchers estimated that for every
additional electric vehicle the new tax credits put on the road,
(05:11):
about three other EV buyers would have made the purchases
even without the seventy five hundred dollars credit, so saying
most people are making the move with or without the credit.
That dilutes the effectiveness of the subsidies, which are forecast
to cost as much as three hundred and ninety billion
dollars through twenty thirty one. And the question we raised
(05:32):
this shortly after it was passed. Mark FANDETI and I
had you know, a long talk on the air about this,
where we said, look, if you know with absolute certainty
that the best thing to do in the world is
to build electric vehicles because they're the best way to
get around and they're the most efficient, and this is that. Okay, fine,
(05:55):
commit to doing this as policy. But who's this say
that five or ten years from now, we don't sit
there and say, gee, we've you know, figured out a
better way to do X, Y and Z, and now
we just spent four hundred billion dollars subsidizing a vehicle
that's now obsolete and we need to replace because hey,
the batteries take longer to degrade than we thought, or hey,
(06:18):
you know there's there's something out there that is better
for the environment.
Speaker 3 (06:22):
Like please, chuck, when was the last time you can
point to a government making a bad investment?
Speaker 2 (06:29):
Hold on, I got a file for this stuff to
take a look for a second. So I think these
are the problems that you run into here. Now, if
you want to say, look, we want to you know,
create incentives for manufacturing of X, Y or Z in
the United States, that's a different thing. But that wasn't
just that wasn't the key goal. We were specifically saying, no,
(06:50):
we need to make batteries and evs here because we
need them here, not being made somewhere else, and we're
spending four hundred billion dollars to do that. Now, you
and I have talked an awful lot, Mike, where hey,
I'm on board saying look, I don't know if the
Chips Act is gonna make any economic sense, but I
(07:12):
know we need to produce semiconductors here because there's a
real risk to national security and in the US, you know,
society as a whole if we can't source those here.
Same thing with medicines, with medical devices, with you know,
anything related to the military, Like, yes, you need to
build that stuff here in the United States. Do EV's
(07:36):
fit in any of those category? Like if if all
of a sudden tomorrow, if we snapped our fingers and said, hey,
there's no EV's produced in the US, and all of
your foreign suppliers have said they won't sell to you.
What does that do to US society? The answer is nothing,
not much. The answer is nothing. And I say this
(07:57):
my family, We we own an EV I likes. But
I can also understand why this doesn't make sense. Yeah,
I mean, I've struggled with that too.
Speaker 3 (08:08):
I don't think I want the Chinese making every car
that's sold in the United States. But not because I
worry about, you know, the drive train of a Chinese car,
which I would. I worry more about the technology that
goes into cars these days and the potential effect that
that would have.
Speaker 2 (08:26):
Right, don't track where I go. I only want American
companies tracking where I go.
Speaker 3 (08:29):
Look, I know plenty of this stuff is up for debate,
but I think the easier path would be to say, hey,
we have this externality that seems to be a problem,
which is let's say it's pollution, so let's try and
you know, let's try and fix the thing that we
have identified as the bad thing, rather than trying to
pick the winner, which was in this case electric vehicles,
which again I see how you get there. As the
(08:53):
Biden administration and what led them to that path. But
how do you determine that ev are seventy five hundred
dollars more valuable to society then Honda Civic that gets
forty miles per gallon or a hybrid that does something similar.
(09:13):
You are required to place values on this. I mean,
this would be political suicide, which is why it wasn't done.
But if this is the real problem that you have,
then implement a new gas tax. Yeah, it sounds fun. Again,
political suicide, you're not going to do it. But if
you're trying to really combat the problem and push people
into more fuel efficient vehicles, which is clearly what you're
(09:34):
trying to do is the Biden administration, here, make gas
costs four bucks a gallon. That'll do it pretty quick.
Take a quick break here.
Speaker 2 (09:42):
When we come back, we're going to do a little
bit of trivia on the financial exchange, and then we
got a couple of personal finance topics we're going to cover,
including why saving for retirement is or is not more
challenging for the younger generation. And then also if you
happen to in the middle of required minimum distributions, you're
(10:03):
getting towards the end of the year and you're old
enough that you have to take one. But what do
you do with a required minimum distribution if you don't
actually need a take it the money you will. Yeah, sure,
I don't think that was one of the options. Now
it was, But we'll take a quick break and then
we'll discuss that when we return.
Speaker 1 (10:21):
Tune in for Trivia brought to you by Applebee's every
day at eleven twenty For your chance to win cool prizes.
Text us at six one seven three, six two one
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(10:41):
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Speaker 4 (10:50):
Trivia brought to you by Applebee's. Take your friends or
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(11:11):
prohibited dye in only. Well, we're doing candy trivia here
on the Financial Exchange throughout the month of October.
Speaker 2 (11:19):
So here we go.
Speaker 4 (11:21):
Back in ninety five, Eminem introduced the Blue Eminem. The
candy company wanted to replace one of the long standing
colors used in bags of Eminem's and had consumers vote
on the new color trivia question today, which color Eminem
did blue replace? Once again, which color Eminem did blue replace?
(11:43):
Be the eighth person today to Texas at six one
seven three six two thirteen eighty five with the correct
answer you know when a Financial Change Show t shirt
brand new, by the way, and be registered to win
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Speaker 2 (11:56):
Be short.
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Include the keyword applebs in your text and we'll get
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One seven three six, two thirteen eighty five, and the
eighth correct response will be our winner. See complete contest
rules at Financial Exchange Show dot com Mike.
Speaker 2 (12:12):
Since twenty twenty three, most retirees have to take required
minimum distributions beginning at age seventy three that is scheduled
to you know, move to a later age.
Speaker 3 (12:24):
Age seventy five for some younger workers.
Speaker 2 (12:27):
Correct, But at this point it's age seventy three. So
let's say you're seventy three this year. If you have
a retirement account that is not in an employer sponsored
plan where you are active, you have that rm D
that you have to take. And in some cases this
works out great because the retiree says, perfect, I wanted
(12:48):
to take you know, three or four percent out of
my portfolio anyways to support my my lifestyle and retirement. Wonderful.
I'm just gonna do that, and then I, you know,
kill two birds with one stone. But occasionally you run
into someone who says, look, I've got enough income already.
I got Social Security, or I got a pension, or
(13:08):
I have you know, rental income from properties or whatever
it might be. Hey, I don't want to take this
money out, but I'm being told I have to. What
does a retiree do in that situation. I guess the.
Speaker 3 (13:21):
First thing would be, hopefully you're not already there, because
there's a lot you can do when you say sixty
five and a lot less that you can do when
you were already, when you were already seventy three and
finding yourself in this position. But believe it or not,
there are people out there who will end up paying
more taxes in their seventies than they did when they
were in their fifties and working, or in their eighties
(13:42):
when they were in their fifties when they were working
at a higher tax rate. Because of this, and with
a little bit of you know, forethought and planning in
your sixties, you can make a big dent on this
with a strategy that's become immensely popular over the last
decade or so Roth conversions. But you know a few
things that you Le's assume that you're not there, right.
Let's assume that you're already at seventy and you didn't
(14:03):
do the planning and you're now sitting there one not
necessarily too late, But you cannot, for example, take your
required a minimum distribution and toss it into a roth IRA.
Speaker 2 (14:14):
No, you're not allowed to do that. Get asked that
question a lot. You can't.
Speaker 3 (14:17):
They don't let you do that. You can go above
and beyond your required a minimum and put it into
a ROTH but you can't take that R and D
and put it there. A lot of folks end up
reinvesting some of their money, and it can be pretty
tax efficient to do so, but it ends up going
into a brokerage account or something along those lines. The
only real way that exists to avoid taxes on that
(14:38):
required minimum distribution is something called a qualified charitable distribution,
and that can be beneficial too, right if you're already
donating money to charity and you're writing it out of
your checkbook, for example, doing it from the IRA if
you're in your seventies can be a lot more tax efficient.
Speaker 2 (14:56):
Speak with a professional about that.
Speaker 3 (14:58):
Before you just go and blindly do it, because you
have to follow some rules about it. But that is,
you know, really the only one area that I can
feasibly look at to say, hey, this is one way
to avoid the taxes on your required minimum distributions. But
like I said, a ton that you can be doing
in your I don't hate to put a number on it,
but the between the stage sixties generally your sixties when
(15:20):
you are retired, but not yet seventy three or seventy
five for our older listeners out there, there is so
much planning that can be done, and the temptation and
the you know, most common practice for most people that
I speak to is, hey, I've retired now, so I'm
gonna start taking money out of my IRA to live
off of.
Speaker 2 (15:37):
And that is a common strategy.
Speaker 3 (15:38):
But for folks that might have other buckets of money
spent saved up, it can be a lot more efficient
to pull from different buckets in that in between stage
and really structure your tax situation differently to avoid that
giant tax bomb later in your seventies and eighties. And
like I've said, I have seen people who end up
paying bigger tax bills in their seventies and eighties, which
(16:00):
impacts things like your medicare premiums and all sorts of
things they didn't really plan for. In any case, I
know a lot of people are facing questions like this
or just starting to learn about required minimum distributions and
how they might affect you down the road. We at
the Armstrong Advisor Group would love to talk to you
about it. We've got offices throughout New England, We've got
(16:20):
folks on call that handle these types of questions that
affect retirees every single day, and we'd love to sit
down with you and talked about your personal situation, because
every single one of these is different. Some people have
a pension, some don't, social security, how much you'll have
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(16:42):
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Speaker 1 (16:58):
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Speaker 2 (17:14):
Mike, there's a piece in Barons today. It's titled saving
for retirement is more challenging for younger generations. Here's why
do you buy it?
Speaker 3 (17:25):
Wow?
Speaker 5 (17:26):
Wow, Look as someone can buy homes now as someone
who is firmly in the millennial generation and eating avocado
toast every day.
Speaker 3 (17:38):
Let me tell you, there's people here watching you. They
can't you can't lie about it and say that you're
eating avocado co coast this morning. Okay, fair enough.
Speaker 2 (17:46):
Thank you. In any case, twenty years ago not twenty
fifteen years ago. During the Great Financial Crisis, there was
so much written about the millennials are never going to
be able to make it financially, They're going to be
scarred for life than not to be able to invest,
they won't be able to buy homes, blah blah blah,
blah blah. And if you look at the statistics now,
millennials are buying homes or have home ownership basically in
(18:08):
line with Gen X and the baby boomers at the
same respective ages. Just start a little bit later. They
just started a little bit later. And that's how it is.
If you look at net worth adjusted for inflation, it's
moved up in a similar fashion. And so I don't
deny that every generation has its own unique struggles that
they have to go through. And it's not to say
that every generation doesn't have hard things that they go through.
(18:30):
But when you read this piece, about Hey, saving for
retirement is going to be harder for this generation. Like
some of the stuff they say is they're like, hey,
for the last forty years, these were ideal years to
be invested, and markets are at record highs now, and
so future returns might not be as strong.
Speaker 3 (18:45):
So they're presuming that the markets are going to suck
for the next forty years with no base for we
have no idea what markets are going to do for
the next forty years.
Speaker 2 (18:52):
They might be better, they might be worse, they might
be the same, and just saying hey, valuations are high,
so this is going to be tough. Kind I'd also say,
you know, they were brought We're facing broad economic and
geopolitical landscape problems that were largely muted for the previous
generation when happened. Oh, I'm sorry the Cold War didn't exist.
We didn't go through Gulf War one, Golf War two,
(19:14):
nine to eleven, Afghanistan, right, Like, I mean, yeah, every
generation has their own unique struggles that they go through. Yes,
things are tough right now, but they've always been tough,
and so that's why this bothers me. With you quick
break here we get the trivia answer.
Speaker 6 (19:32):
Next bringing the latest financial news straight to your radio.
Every day. It's the Financial Exchange on the Financial Exchange
Radio Network. Find daily interviews and full shows of the
Financial Exchange on our YouTube page. Like us on YouTube
(19:55):
and get caught up on anything and everything you might
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Speaker 4 (20:04):
Trivia question today was which color Eminem did blue replace?
Speaker 2 (20:10):
That'll be ten.
Speaker 4 (20:10):
In late nineteen ninety five, Eminem phased out the tan
colored Eminem's in favor of blue, which beat out pink
and purple in a nationwide vote. Winner today of the
Financial Exchange Show T shirt was Diana from New Britain, Connecticut,
and Diana's also registered to win a one hundred dollars
gift card to Applebee's, which will give away on Friday.
Show and Trivia is brought to you by apple Bee's.
Enjoy half price late night appetizers after nine pm and
(20:33):
join Club Applebee's to enjoy exclusive deals and specials. You'll
get a free appetizer just for signing up. Now that's
even good. In the neighborhood board, we're prohibited Dinah only.
Speaker 2 (20:44):
Mike. There's a piece in the Financial Times today. It's
titled will Google be broken up, do you know?
Speaker 3 (20:53):
No, I don't think anybody but the judge knows. And
here it is today. The judge did receive the Department
of Justice high level remedies for Again, you have to
go back a few months here, but Google was found
to be a monopolist by a federal judge. So that's
already been determined. The extremely complicated part of this is
(21:13):
so what does that mean for Google?
Speaker 2 (21:15):
And nobody knows yet, and so the DJ is going
to deliver these, you know, remedies to the judge saying, hey,
here are the options that we have in terms of
what could happen. And it could be, look, you can't
sign agreements like you have with Apple to be the
exclusive search provider of you know, on the iPhone. It
could be that we have to break YouTube off from Google.
(21:38):
It could be we have to separate the search business
from the ad business. There's all kinds of different things
that could happen here.
Speaker 3 (21:45):
Given that this was primarily about search, it would seem
odd to me that they would say yeah, and so
as a result, we're stripping YouTube away from the rest
of Google.
Speaker 2 (21:54):
I don't know, wouldn't it just be kind of nice?
I would love it, but it's not.
Speaker 3 (21:56):
It just seems like it's not connected to the case
that here, which is primarily about search.
Speaker 2 (22:01):
True. So the uh, basically, these are going to be
delivered to the judge today and then you have a
hearing set for April, with the judge saying that they
are going to attempt to rule by August of next year.
So it still is going to be another ten months
or so at least potentially longer before we end up
understanding what might end up happen here end up happening here.
(22:25):
And remember this is the first major anti trust win
for the DOJ since Microsoft in two thousand. Yeah, tech
side especially Well again I say major, like, hey, they
stopped Staples and Office Depot from merging Spirit and jet Blue. Great,
Like you know, wow, now you know Staples went out
(22:46):
of business and Spirit's going to go out of business,
you know. So I think this is something that none
of us really know how this is going to play out,
because the precedent hasn't been set. Like there's a whole
generation that has never seen any kind of substantial anti
trust action against a tech company. And so we'll see
(23:06):
what ends up happening here. I will say, according to
people who were you know, more familiar with anti trust
law than I am, they have said that it would
be unusual to see, you know, a significant structural remedy
such as breaking up Google or spinning off its web
browser or something like that. But you might see the
(23:29):
DJ propose them just to say, hey, here's how far
we might want to go, and here's something lesser that
still might have some kind of substantial impact. It leads
me to a question.
Speaker 3 (23:37):
I mean, has sooner I had done a good job
the CEO of Google you compare him to, I mean,
certainly he's overseen Google among you know, some of its
most dominant years. It is a let's be honest, you
don't get sued for being a monopoly by being bad
at business. The entire reason you're getting it is because
(24:00):
you've become so dominant in the space that you play
in that you're being anti competitive and you are a monopoly.
So I acknowledge that, But part of your job is
also to make sure that you don't get sued by
the Department of Justice and forced to be broken up.
Speaker 2 (24:13):
Here and Google is.
Speaker 3 (24:16):
Now, you know, in a position where not only are
they facing these you know, anti trust concerns and potential remedies,
and a you know, successful lawsuit from the Department of Justice.
They're also facing a new threat from artificial intelligence that
quite honestly seems like the first legitimate threat to their
advertising business that we've seen in a couple decades.
Speaker 2 (24:37):
How do we define doing a good job? I hear
is the CEO of Google. Look, if you look just
at the stock price, but Chi came on in twenty fifteen,
when the stock was trading in the twenties. Today it's
one hundred and sixty four dollars in change. So from
a pure stock price perspective, like if you're a Google
shareholder over that time, not much to complain about it.
It's tough to be like, hey, I'm really upset, you know,
like things have been good. If you're talking about innovation,
(25:07):
I'm not sure there's anything there, quite honestly, yeah, I
mean he took a business that already had a model
and that was remotely interesting. That's extreme.
Speaker 3 (25:20):
But like for genuine, genuinely innovative I come up, I struggle.
Speaker 2 (25:26):
And and what's what's tough about that is Google. You
can make a case. During the tech bubble was one
of the most innovative companies. I mean, they were not
the first search engine on the block. They were like
the twelve thousandth but their algorithm provided better results, and
people flocked to it, and people people chose it. It
was It wasn't that Google imposed itself on people. People
(25:48):
that came later. People sought it, sought it out right,
and then Google said, well, now that you're here, we
want to make sure you can't leave. And and that's
why they're in the situation with the DOJ. So I
struggled to look at the last years of Google and say, hey,
what have they done from a product perspective that's really interesting?
I don't have anything. I mean, yeah, they've got their
(26:10):
you know, Waymo cabs that they're trying out, but they're
still in like two cities.
Speaker 3 (26:15):
They've got an entire healthcare division that, as far as
I know, has not done much in the way of
interest to my knowledge. Yeah, I mean, I think the
most compelling thing you can talk about is that they
have maintained market dominance for a much longer period of
time than I think most technology companies do historically, and
(26:37):
and they're being sued for that. So don't get me wrong.
Speaker 2 (26:40):
They're not like a bad company. I mean, they're well run,
they're profitable. But I don't know. Don't you want your
tech companies to come up with tech? I kind of do.
I kind of do. Speaking of tech, should we talk
about artificial intelligence? I was pretty fat.
Speaker 3 (26:59):
So there was a survey done that was we sometimes
talk about surveys and you're left questioning like what am
I supposed to do with this? And was this even reliable?
This was a big survey that was done based on
trying to get the same demographics as our census, and
they asked a few questions similar to what you ask
on the Census to really test Hey, was this a
(27:21):
good survey and did it correspond similarly to census questions
and answers?
Speaker 2 (27:25):
And the answer was yes.
Speaker 3 (27:26):
So it was pretty representative of the American public and
found I think some pretty surprising stuff in terms of
Americans' usage of artificial intelligence right now. So do you
want to rattle some of them off, Chuck?
Speaker 2 (27:37):
Yes. And this is as a study that was done
by the good nerds at Harvard. They looked at a
bunch of data and said, here's what we found based
on this survey and forty percent of Americans age eighteen
to sixty four have used Generative AI, so that would
be something like chet GPT correct and a sizeable percentage
(27:58):
they say seems to use it regular They found that
more than twenty four percent of American workers have used
it at least once a week in the you Know
survey period, and nearly one in nine used it every
work day.
Speaker 3 (28:13):
So that's ten percent of Americans are using generative AI
every single day for work.
Speaker 2 (28:22):
Now I'm someone I use it on that kind of
once a week basis occasionally more than that, but like,
I fit into that group, and there are certain things
for which it's really useful. There are also things where, again,
you poke around on it enough and you're like, okay,
I can't use it for this, or things where you
have to figure out how to train it in order
(28:43):
to do something that you want it to do because
it doesn't have the proper training to begin with, which
is kind of creepy but also kind of amazing at
the same time, because you basically tell it, hey, I
want when I ask you for X, here's how you
do it in order to spit out why, and then
it can actually do it and you don't have to
(29:04):
be a programmer. You don't have to know any kind
of coding. You just literally tell it like you're teaching
a dog or a child, or like even like anything.
Speaker 3 (29:12):
I tried to teach my dog how to do math
for years and it didn't work too well, but.
Speaker 2 (29:16):
Doing it wrong.
Speaker 3 (29:17):
I mean further, with this study found twenty two percent
of blue collar workers have used it and other than
personal services, so barber's, hairstylists, nail salons, workers, every other
major job category had seen at least twenty percent adoption
of generative artificial intelligence. I'm not saying this is universally
(29:38):
a good thing. By the way, I hope you don't
misunderstand me. There are massive potential pitfalls to all of this.
But I was quite frankly shocked by the headline number
that forty percent of Americans age eighteen to sixty four
have used AI in some way, shape or form.
Speaker 2 (29:57):
Generative AI now has been around for two years. Right,
show me one technology that was about technology has been
adopted by almost a quarter of all working people in
a two year period.
Speaker 3 (30:11):
I would hesitate to come up with one. Smartphone didn't.
Speaker 2 (30:14):
Smartphone took you know, probably five to seven years, I
will Internet. I mean, this is kind of wild stuff. Yeah,
and arguably depending on how it you know, social media.
Speaker 3 (30:25):
Social media might be the only one that I can
look at hardly a technology, but it might be the
only one I can look at to say that had
a very rapid adoption. But for us, yeah, even then,
I doubt it was forty percent of Americans eighteen to
sixty four with than two years.
Speaker 2 (30:43):
It's wild. Yeah. To take a quick break here. When
we return, it's time for a little bit of stack roulette.
Speaker 1 (30:51):
Business and financial news affecting the markets and your wallet.
We've got it all straight from Wall Street right here
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catch up at your convenience by visiting Financial Exchange show
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(31:12):
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Speaker 4 (31:22):
This segment of The Financial Exchange is brought to you
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Speaker 2 (31:55):
Michael, what do you have for me for stack roulette?
Speaker 3 (31:58):
I want to talk about a new type of flation
thatation haven't discussed. We've talked about inflation, deflation, shrink flation.
What other flations have we have? We disinflation, disinflation, this
one is skimpflation that Whole Foods was accused of here,
and skimflation is, according to whoever coined this phrase, just
(32:23):
making a product cheaper and can I say crappier, just
generally worse at the at the behest of profit. And
Whole Foods saw some backlash on this, so I can't
say that I have frequently tried their berry Chantilly cake,
but apparently they shrunk it, replaced it with garbage ingredients,
made it a lot worse, and.
Speaker 2 (32:46):
Go ahead. This this piece says that it's an iconic
berry chantilly cake.
Speaker 3 (32:53):
I I think iconic a little bit extreme. But in
any case, what I liked about this is that people
got poed. They got really angry, and they started posting
about it on social media and whining about it and
complaining about it so much that Whole food said, forget it,
We're not doing that. We're going like over two days
(33:16):
they went and changed their policy on all this. And
what it reminds me of is that we actually, as
like consumers, do have some power over these companies that
sell us stuff all the time. Like if we actually
make a point of pushing back on this, well that
would be My point is Unfortunately that power seems to
be concentrated at wealthy households that shop at Whole Foods
(33:36):
rather than the general public.
Speaker 2 (33:37):
But no, the general public has this too. It's the
problem is that we just there are two problems. Either
A we just accept it or B the problems that
we see are in industries for which there is no
competition and so we can't do anything about it. Sure
see the airline industry. Hey, you're trying to fly to Austin, Texas. Great,
you got forty five Southwest flights and one flight from
(33:58):
United that'll get you there. And so you don't have
any alternatives in terms of, hey, I want more leg
room or this. No like that. There is no more
leg room because we're the only company that does this.
So this is one of the reasons why I'm so
adamant that we could get rid of an awful lot
of regulation when it comes to business practices if we
(34:23):
just had more competition. Yep, because stuff like this is
solved by someone saying, hey, you know what you're you're
making a bad cake. Great, I'm gonna get my cake
somewhere else.
Speaker 3 (34:31):
And Hohpefood's changed their mind rather quickly, right, Wholefood said, which,
good job. Whole Foods too, like, actually listen to your customers.
Speaker 2 (34:37):
Yeah. I give them credit for that, because it would
be easy to just be like, no, like, we've made
this change, and this is what we're sticking with because
a lot of times that is what you end up
hearing from companies is right.
Speaker 3 (34:46):
We are Amazon. We don't care about what you have
to say, so we're not going to change anything. You
have to keep Amazon, That's what I mean. Oh like
that you could see you can see them saying that, hey,
we you know, I understand that you're exact about your
Barrish Antilly cake, but we're Amazon. We don't care. But
they did. They actually went and switched it.
Speaker 2 (35:03):
I want to talk about pickleball piece of the Wall
Street Journal. The turf war between tennis and pickleball is escalating.
Speaker 3 (35:11):
So there are tennis courts right next to our office
where we usually do the program from today we're in Springfield,
but generally were speaking, we do the program from Needham.
There's tennis courts that are right next to our office
that for years were empty and now are packed with
pickleballers all the time. And it actually made like somewhat
regional news that somebody snuck in in the middle of
the night and took a knife to all all the
(35:32):
pickleball nets, which I just find so petty and hilarious.
But go on, the pickleball wars are real.
Speaker 2 (35:39):
I'll quote here on at least one front, there is
no longer denying that tennis and pickleball are in direct conflict.
The battle for court space has arrived and tennis is
losing ground fast. Today. The USTA says at least ten
percent of tennis courts in America have been taking over
and repurposed for pickleball. Quote, there are not enough courts
to support tennis growth, and court infrastructure is being comprom
(36:00):
with people playing pickaball on those courts or courts being repainted,
according to USTA chief Blue Share. Now, as someone who
you know, both skis and plays soccer in the US,
I understand, you know, niche sports that don't have you know,
a ton of following following in the United States. But look,
(36:23):
I go past tennis courts all the time, like just
driving around. It's rare to see them empty, except when
you actually have pickleballers in and then there's like forty
six pickleballers on each court. And so I don't buy
that there is a lack of courts that's restricting the
growth of American tennis.
Speaker 3 (36:41):
No, there's a lack of demand that's restricting the growth.
Speaker 2 (36:43):
Right, Americans just have not been playing as much tennis.
Speaker 3 (36:46):
I like tennis, I like I watch it occasionally. It's fine,
it's okay, not my favorite. Like this is a market
based problem. That is being solved by the markets. There
is a twenty one court pickaball complex opening up for
one hundred thousand square feet in the Natick Mall in
Massachusetts this month. They're going to have bars, restaurants like
(37:09):
they are solving this problem with market based solutions. And
I mean the problem is that tennis. Yeah, you are
the uh, the victim here of the growth of pickleball,
and it's going to come at your popularity. But sorry,
I don't know what you want me to do about it.
What do we want to do? Ban pickleball courts in
(37:29):
order to support plenty of places, well, not to support tennis,
but plenty of people have been banning pickleball courts because
they want to complain about the noise, which I find
to be hilarious. If you should see the noise coming
from the hockey rink when I play once a week,
is there a lot? Well, it's just far more offensive.
Speaker 2 (37:45):
Oh well, it's also indoors though true.
Speaker 3 (37:48):
You know.
Speaker 2 (37:48):
Taking a look at markets, as we had towards the
top of the hour, the Dow is up seventy two points,
the S and P's up forty six, the NASDAG up
two twenty seven, so all three major US markets in
positive territory to start the day. We'll see if they
finish the day there. Oil price is still falling today,
down three point fifty a barrel on West Text Intermediate
(38:09):
to seventy three sixty four. We'll see if we get
some follow through. If we continue to see no further
activity in the Middle East, we're done for the day.
We'll see you tomorrow on the Financial Exchange
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