October 28, 2024 • 35 mins
Chuck Zodda and Mike Armstrong discuss economists warning of new inflation hazards after the election. the porterhouse at Weis points to inflation's demise. Owning a vacation home in hurrican zones is worrisome. Some owners are selling. Why it's so hard to fina a job in this strong labor market.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
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
(00:20):
any investment decisions. Armstrong Advisory and the advertisers heard on
this program do not endorse each other or their services.
Armstrong and Money Matters Radio do not compensate each other
for referrals and are not affiliated. This is The Financial
Exchange with Chuck Zada and Mike Armstrong, your exclusive look
at business and financial news affecting your day, your city,
(00:43):
your world. Stay informed and up to date about economic
and market trends plus breaking business news every day. The
Financial Exchange is a proud partner of the Disabled American
Veterans Department of Massachusetts. Help us support our great American
heroes by visiting DAV five K Boston and making a
donation today. The DAV five K Boston is presented by
(01:04):
Veterans Development Corporation. This is the Financial Exchange, with Chuck
Zada and Mike Armstrong.
Speaker 2 (01:13):
Kicking off hour two of the Financial Exchange.
Speaker 3 (01:15):
Today, it's Chuck, Mike and Tucker and stock's broadly in
positive territory here with the Dow up three hundred points,
the S and P five hundred twenty five, and the
NASDAG up ninety two, so about a half a percent
jump in equities. To kick things off today, you've got
the ten year US Treasury continuing its sell off, now
(01:36):
up another three point two basis points to four point
two six four percent, so closing in on you know,
seven tens of a percent, rising a seven tens of
a percent rise since the FED began cutting interest rates.
We also have oil, the big move down today, currently
down five point one seven percent, about three seventy one
(01:56):
on West Texas Intermediate.
Speaker 2 (01:58):
This on the back of.
Speaker 3 (01:59):
The Israeli strikes of Iranian military sites on Friday evening.
The oil market interpreting this and the Iranian response as
something that at least in the short term, takes away
some of those worst case scenarios as far as potential escalation.
We'll see where this goes over the course of the day.
As far as oil prices, at one point West Texas
(02:22):
Intermediate was down about six and a half percent, So
it's rallied off those lows.
Speaker 2 (02:28):
We'll see where it ends up going here.
Speaker 3 (02:30):
Also, the TRIPAA national average for gas prices continuing to
slide now at three point thirteen nationally. With this move
on West Texas Intermediate, within the next couple of weeks,
you would expect to be seeing the national average making
a run for a two in the first digit. We
got a potential you know, two ninety five to two
ninety eight siting coming up in the next couple of weeks.
(02:52):
If oil prices are able to hold in this range again,
we'll see if they actually do. Gold up to eighty
one ounce despite the you know, general kind of risk
off sentiment related to the Middle East gold saying, hey,
that's not where my bid is entirely coming from. And
so gold holding its ground pretty well today up to
ten and ounced to twenty seven fifty six and seventy cents. Mike,
(03:15):
anything else catching your eye?
Speaker 4 (03:17):
Not market related?
Speaker 2 (03:18):
Now what else is catching your eye? It's not market related?
Speaker 4 (03:21):
This piece from Nick Timrouse in the Journal here economous
is maybe like a deal on lunch or something. I
am looking for a deal on lunch. Do you got
any idea?
Speaker 3 (03:29):
No, I brought a turkey sandwich and I'm gonna be
wholly unsatisfied with it. Was one of those I'm unpacking
the turkey this morning and I'm like, you know, you know,
just a turkey.
Speaker 2 (03:40):
It just didn't feel good in part of it.
Speaker 4 (03:42):
Last week I got a part in your hands.
Speaker 3 (03:44):
No, last last week I had the best turkey man Like,
I was like, oh, this this is the good stuff,
you know, like loaded up this one.
Speaker 2 (03:51):
I'm looking at him like wimpy turkey.
Speaker 3 (03:55):
Kind of Rubbery's not sure if it's gonna work for me.
But anyways, Nick tim Morous is.
Speaker 4 (04:00):
Saying economists warn of new inflation hazards after election. So
I want to talk about in what world we actually
need to worry about this. And the frustration that I
have is it seems to me that our only criticism
of irresponsible government behavior, and by that I mean spending
(04:22):
and not raising taxes to correspond to that spending and
running up deficits higher, seems to come from a point
of short term inflation. And I think that over the
last fifty years, we've come up with enough evidence to
say that increased government spending on its own does not
uniformly increase inflation. You can get to a point where
(04:44):
it does, at least not in the United States. You
have very little evidence that that has been the case
until you've reached really, really high levels of spending like
we saw in the spring of twenty twenty. But even
then you also had to have completely mangled supply chains
to get you there. And so I just find it, well,
(05:05):
I find it not good from the perspective of if
this is our only criticism and it keeps failing as
a realistic criticism, then nobody's gonna actually be worried about
irresponsible government spending, which in my view, is a real
problem for our future. Well, so first thing, let's tackle
the first point first, which is, do you see anything
(05:27):
that you've heard from the campaign trail that is realistically
going to result in inflation in twenty twenty five the
likes of which we saw anytime over the last four years. No,
nor do I. And again it's not to say that
I think the policies coming from either side of the
campaign trail are good for our economy. I just don't
think they're going to spark nine percent inflation. No.
Speaker 2 (05:49):
I do think it's interesting that.
Speaker 3 (05:51):
Look, if we're going to be intellectually honest about the
government spending side of things, when's the last time you
actually had anyone running for president, not you know, the
House or the Senator, whatever, anyone running for president who
was serious McCain about managing the size of the deficits.
(06:12):
I did even give you Romney, okay, you know, like
Paul Ryan cut his bones being like, hey, I'm gonna,
you know, try to reign in federal spending. Yeah, and
like that. That was kind of a core thing there.
But ultimately, like it's been like at least twelve years
now since you had a candidate who was like, yeah,
we need to really focus on this as a thing,
(06:33):
because right now I got both campaigns promising to not
tax tips. Are both Is it just the Trump campaign
that's saying I'm not going to tax so security. Did
Harris go in on that too, I don't know at
this point. Yeah, it's preposterous that ever pros on this.
You just have you know, tax cuts being thrown around
left and right. You've got promises on additional spending. The
(06:55):
Harris campaigns like I'm gonna do like twenty five thousand
dollars down payment assistance and build three million more homes.
Speaker 4 (07:01):
Give all sorts of parents, you know, universal pre K
and right and pay childcare.
Speaker 2 (07:06):
Yeah.
Speaker 3 (07:06):
The Trump campaign now was saying, Hey, in a perfect world,
I'd love to get rid of the income tax.
Speaker 2 (07:09):
Okay.
Speaker 3 (07:10):
That's like me campaigning for seventh grade class presidents saying
that you're gonna get rid of homework.
Speaker 2 (07:13):
Like, okay, good luck with that, you know.
Speaker 3 (07:15):
Like, I just think we're in a world where we're
not being honest about what we need to do to
get our deficits to a manageable size. I'm not saying
you have to eliminate them, because remember, you know, I
hear all this talk, not all this talk, but you
talk to people and you'll hear, well, you know, wouldn't
it be great to run a surplus and listen. As
(07:39):
much as I might dislike large deficits, surpluses are worse
because that literally means that the government has taken in
more money than it knows what to do with. It's like, hey,
I don't like being taxed, but when I do, I
like to be taxed, So much that the government can't
spend all my money. No like that that's just not
that's not good either. But I think there's a place where, hey,
if you can get to running you know, one and
(08:02):
a half to two and a half percent annual deficits
instead of the five to seven percent annual deficits that
we're seeing now. Yeah, that that's like a reasonable place
to get to.
Speaker 2 (08:12):
And the issue that you.
Speaker 3 (08:13):
Run into on this from a long term inflationary perspective is, Hey,
let's say that you have a situation like what we
have now, which is, hey, federal government outlays on interest
are going to be somewhere between thirty and forty percent
of all revenue collected over the next several years. Right,
(08:36):
so before you even get to spend a dollar on
do D, do any anything else, Social Security, medicare, any
of that stuff, Before you get to spend any of that, hey,
thirty to forty percent of your tax revenue goes to
paying interest. So what it means is, hey, if you
want to be reasonable about how to you know, rain
those deficits in, then it's going to come at the
(08:57):
cost of short term economic growth. Because as much as
we might say, look you don't want to try to,
you know, just use government spending to grow the economy.
The fact is government spending still does grow the economy,
just not as efficiently as it does in the private sector.
Like you spend a dollar of government money, someone's still
getting that contract. So I think that when when we
(09:19):
try to be like intellectually honest about all of this,
it's something where the path towards getting these numbers sustainable
are Hey, it's going to take some pain from all
of us in some different ways.
Speaker 2 (09:32):
In order to do so.
Speaker 3 (09:34):
And we haven't really been good at stomaching political pain.
Speaker 4 (09:38):
No recently now, not a whole lot of politicians running
on the ask not what your country can do for you? Right,
Like it's no, like, definitely ask what your country can
do for you, because we can cut all sorts of
taxes and give you all sorts of money. That's a
real problem.
Speaker 3 (09:55):
Yeah, who's actually like again, you might not like either
one of these things.
Speaker 2 (09:59):
You might like one of them, might like both of them.
I don't know.
Speaker 3 (10:02):
Like there's some people who are just you know, kind
of masochists on all the side of all this stuff.
Who's the candidate out there is gonna be like I'm
gonna raise your taxes and cut spending.
Speaker 4 (10:11):
Yeah, I don't hear from that person.
Speaker 3 (10:14):
They don't exist right now. And I'm not saying you
have to get to like some crazy austere place. I'm
not saying that you have to run surpluses because again,
I'm not not a surplus dude, man.
Speaker 4 (10:26):
And that's my question is what changes. It seems to
me that something has to blow up in your face
to change that. It seems to me that we actually
have to send people so security checks that are twenty
percent lower than the one they got through the month
before before people finally wake up and like, oh yeah,
this thing's an actual problem here.
Speaker 3 (10:45):
What American needs in order for that to happen is
its own head of lettuce moment. Yeah, just a big
slap in the face, you know, for those who don't
understand the head of Lettuce reference. Theresa May comes in
and says, hey, here's my budget for uh, you know,
for the UK, and what happened to UK bonds? They
sold off like one and a half percent in the
(11:06):
span of a week and that was the end of
Teresa May. Like it was that government was gone. Yeah again,
she did not last last longer than the head of Lettuce.
There's a Twitter account that tracked it had a head
of Iceberg Lettuce in the Lettuce one was still there
in Teresa May was not in power anymore.
Speaker 2 (11:26):
That was her government, right, am I make yeah?
Speaker 4 (11:27):
I think.
Speaker 3 (11:28):
Yeah. They've gone through like a bunch over there in
the last few years. It's kind of hard to keep up.
Speaker 2 (11:33):
Sometimes.
Speaker 1 (11:34):
Find daily interviews and full shows of the Financial Exchange
on our YouTube page. Like us on YouTube and get
caught up on anything and everything you might have missed.
This is the Financial Exchange Radio Network. Text us six
one seven, three, six two thirteen eighty five with your
comments and questions about today's show and let us know
what you think about the stories we are covering. This
(11:57):
is the Financial Exchange Radio Network.
Speaker 4 (12:00):
I'm finally starting to get some reasonable market data out
of my children here because, without saying the name here,
my kids are obsessed with this candy.
Speaker 3 (12:08):
Oh interesting, yeah, interesting, Mike. You ever been to Dingman's Ferry?
Speaker 4 (12:14):
I love weird down names. I have not been to
Dingman's Ferry unless I've accidentally driven through it, but I've
certainly not stopped in Dingman's.
Speaker 3 (12:23):
I quote here in Dingman's Ferry, Pennsylvania, less than fifty
miles from President Joe Biden's hometown of Scranton, where unemployment
fell to a record low of two point seven percent
in April.
Speaker 4 (12:32):
Where did the two point seven percent was that Scranton
or Dingman's Ferry?
Speaker 3 (12:35):
Don't know, poorly constructed sentence surgeon, consumer prices unleased by
the COVID nineteen pandemic or similarly subdued. Weiss Markets Incorporated,
the chain of two hundred grocers, mostly in the Keystone State.
Earlier this month sold a choice Porterhouse steak for seven
to ninety nine a pound to one of its regular customers.
Speaker 4 (12:52):
Just one.
Speaker 2 (12:54):
Listen.
Speaker 3 (12:55):
There's a lot of problems that I have with this piece,
quite honestly. The first is ding like the way that
it's talked about here. You're like, oh, that must be
some like bustling metropolis wherever.
Speaker 2 (13:07):
To quote from.
Speaker 3 (13:08):
Wikipedia, Dingwin's Ferry is an unincorporated township unincorporated community in
Delaware Township, Pike County, Pennsylvania. As of twenty fourteen, it
had a population of just over one thousand people.
Speaker 4 (13:19):
How do they even have a grocery store? Fine?
Speaker 3 (13:22):
Look, everyone's entitled the groceries. I don't want to be
like take away their grocery.
Speaker 2 (13:26):
Store, which I know I do.
Speaker 3 (13:27):
I'm running out, I know is not what you were saying,
but like, why is some random town of a thousand
people in Pennsylvania representative of what meat prices should be
in the country.
Speaker 4 (13:39):
Let me just ask you. Are you, Chuck and Tucker
getting used to grocery prices because I'm getting there, especially
now that I've stopped shopping at Wegman's for like every
one of my grocery shops.
Speaker 3 (13:53):
I do all my shopping at DJs now, and I
will tell you it does a lot to make you
feel great about prices. I picked up I think it
was either six or seven pounds of pork chops last
night eleven Bucks.
Speaker 4 (14:04):
Yeah, I'm having a lot more shopping going on at
market Basket, and I'm always happy whenever I leave market Basket.
And I know that prices are up there too, But
I'm starting to settle in here. I'm starting to settle
in here now that there hasn't been an entire shelf
missing of products that I need. Now that you know
(14:24):
I've been paying these higher prices for over a year,
It's not that I love it. It's not that I
enjoy that most of my groceries are twenty to twenty
five percent more expensive, but I am starting to get
used to it.
Speaker 3 (14:36):
Yeah, I mean again, I've changed my behavior in that
I'm not shopping at traditional grocery stores for my groceries anymore,
partly because again, the idea of spending like however much
it is for a pint of blueberries, only to see
my one year old eat the whole thing at once,
I know it is like right in that ballpark, yeah, for.
Speaker 2 (14:58):
Two of them. So again, like you get more for
your money.
Speaker 3 (15:01):
And that's the adjustment that I've made, and I'm not
going back, because I do find grocery prices still too
high for the sheer volume of food that I need
to buy right now.
Speaker 4 (15:14):
In part again, We've talked about this piece a lot,
but wage gains have gone up to and according to
the Bureau of Economic Analysis, which we cite data from frequently,
spending on food right now makes up less than seven
and a half percent of consumer spending. That's the lowest
(15:34):
since before the pandemic in February of twenty twenty. So again,
I know that sounds strange. It doesn't make you feel
incredibly great because your total spending buckets still might have increased.
But again, when you compare food spending right now to
incomes and to where they've been historically, we're not facing
(15:55):
a truly outsized overall effect. It's just really uncomfortable because
you do it every week.
Speaker 3 (16:02):
And the places where stuff still is uncomfortably moving up
is in places that is that are still having a
big impact though, you know, auto insurance rates and home
insurance rates and stuff like that that can make food
spending feel a little bit tighter because you're like, oh,
I've eaten through more of my stuff to get more
of my paycheck to get here. But yeah, on the
food prices, i'd say, yes, I'm kind of settled into
(16:25):
where I am. I did change my behavior about a
year or so ago, which again also coincided with, hey,
you have another kid, so maybe that changed more than
anything else. But I think ultimately we are seeing prices
stabilized now that they're not going to go down and
mass because that's just not how it works. Yeah, not usually,
(16:49):
And everyone who roots for deflation has never lived through
a deflationary cycle. If you know, anyone who was, you know,
in their teens in the eighteen nineties, give them a
call and ask him what it was like during the
three different banking panics that we had that decade, because
it was probably bad to quite bad. But again, you're
gonna have a hard time finding one hundred and forty
(17:10):
year old to talk to these days.
Speaker 2 (17:13):
There's just not many of them around it.
Speaker 4 (17:14):
Yeah, yeah, I would hope that. You know, we've seen
food prices change people's grocery shopping behavior. Maybe we will
see auto insurance rates change people's car buying behavior, although
I kind of doubt it, but that'd be good. Get
people to stop, you know, spending sixty thousand dollars on
cars when they make forty thousand dollars a year.
Speaker 3 (17:35):
And it would be fascinating if the thing that finally
turns the tide there is people just fed up with
insurance premiums and they're like, yeah, give me the civic Yeah,
I'd love that.
Speaker 1 (17:49):
Bringing the latest financial news straight to your radio every day,
it's The Financial Exchange on the Financial Exchange Radio Network.
Any of the show. The Financial Exchange Show podcast is
available on Apple, Spotify, and iHeartRadio. Hit the subscribe button
and leave us a five star review. This is the
(18:10):
Financial Exchange Radio Network.
Speaker 3 (18:13):
Mike, We've got a piece in the stack today, this
one from barons to owning a vacation home in a
hurricane zone is worrisome some owners are selling.
Speaker 4 (18:24):
As evidence by the fact that home prices in Florida
are currently heading down.
Speaker 3 (18:30):
Yeah, and you've got inventory throughout the state now higher
than it was pre pandemic. And look, I think that
it's important to recognize a couple of different things here.
The first is, Hey, there's something happening in the Florida
insurance market, for the Florida home insurance market that is
really kind of breaking the real estate market the way
(18:51):
that it used to operate. You have premiums that in
a lot of cases are now up anywhere from like
three hundred to six hundred percent over the last five
six years.
Speaker 2 (18:58):
Yeah.
Speaker 3 (19:00):
The other thing that you do have to remember about Florida,
there's three things actually not too The other thing you
have to remember, Hey, back in twenty twenty one and
twenty twenty two, a ton of people packed up from
all over the country, in particular the northeast and expensive
parts of the country, and moved to Florida because they said, Hey,
I'm working remotely, this is great. And some of those
(19:21):
trends have kind of reversed now, so you've got that
reversal that's happening.
Speaker 2 (19:26):
The third thing to remember is.
Speaker 3 (19:28):
Like every three years, Florida goes through a mini property
cycle where they build way too much, a bunch of
people move, then they keep building. Oh no, now we've
built too much, a bunch of people like leave, prices
go down. So it's this hugely cyclical market to begin with.
And they're in the middle of one of those as well,
because they built a ton back in twenty two and
twenty three since they thought a bunch of people were coming,
(19:49):
and now it's kind of stopped. So it's tough to
untangle what is they might come back to over and over,
like what's permanent and what is just a short term glitch.
Speaker 4 (19:59):
Yeah, and it's tough because real estate as an asset
class in a lot of ways is so incredibly attractive,
mainly because the way we fund the purchase. It's not
anything especially unique about primary residences or vacation homes, easy
leverage for people, it's just there's no other asset you
can buy with a thirty year fixed rate loan that
(20:21):
you only have the option to get cheaper over time.
Warn Buffets talked about this recently. He's like, there's nothing
else out there you can say, Okay, yeah, I'm taking
out a loan. It's going to be paid back over
thirty years. The rate will never go higher, but if
it goes lower, then I can lock that in instead.
There's nothing like it, and so there are still a
lot of attractive pieces here. But yeah, I think for
(20:43):
a lot of people, whether it's in Florida or anywhere else,
the idea of heading into their sixties and seventies and
even eighties with a couple of different properties to think
about and worry about is becoming less and less appealing.
Speaker 3 (20:59):
And so I think with Florida and trying to untangle
what is going on in that market, it's going to
take a little bit of time, but it certainly isn't
going to look good for you know, the next couple
of years, just because again you look at the listings there.
But as you know, Mike, it's it's one of those
questions facing retirees, which is, hey, do I go and
(21:22):
you know, buy a second place that I use or
do I uproot my primary residence. And we talk about
this an awful lot in terms of, Hey, when you're
building a financial plan, you've got a factor in the
cost of living. If you're considering moving somewhere, what does
that cost of living look like? And for a lot
of people that have moved down to Florida in the
last five years, the cost of living analysis they might
(21:44):
have done five years ago is completely outdated with how
the state has evolved.
Speaker 1 (21:47):
Now.
Speaker 4 (21:48):
Yeah, I think there's the relocation argument, which again, you know,
can still make a lot of sense depending on which
high tax state you're moving to and which hopefully low
tax states you're moving to. The you know, the interesting
piece about that second property to me is that for years,
financial wise, it has made sense to buy. It has
(22:08):
been a more compelling offering if you're spending six months
of a year in a different place to own something
rather than renting. That's also changing. But where I see
people run into it frequently is they purely look at
it as a financial scenario. And that can be good,
but it doesn't account for unpredicted things like the homeowner's
insurance market going up by three to six hundred percent.
(22:29):
It also doesn't account for the quality of life piece,
and I think people for some reason intentionally avoid this
when it comes to their own retirement plans. They're super
focused on the numbers and instead maybe it should be
focused on Okay, yeah, it is going to be more
expensive for me to rent a place for three months
down in Florida in peak season, but is it worth
(22:50):
it to me?
Speaker 3 (22:50):
Well, and I'll give you just an example just from
my own life. My parents, when they were I don't know,
mid sixties, decided they were going to move to to
North Carolina and they did that and they had a
great time down there. When my wife and I started
having kids, they said, look, we want to be closer
to you guys. Even though it's more expensive. They did,
like the opposite of what everyone ever does. They move
(23:12):
back to the Northeast. They're like, yeah, bring on this,
and granted, like they still go when they might rent,
you know, a couple of weeks down in Florida and
a couple weeks in North Carolina now, so they still
do those things just to get away. But it's not
just the financial stuff that you need to focus on
in retirement, because look, like, yes, you might pay less
in taxes in Florida, but you might make that up
(23:34):
spending on you know, trips to go up to see
the grand kids and stuff. When it's all said and
done and it's more hassle and as you get older,
you just don't want to fly as much.
Speaker 4 (23:41):
Well, if you're facing that type of scenario, got bad
news for you. Financial advisor can't tell you where you're
going to be happier in retirement. No, I have no
ability to measure that one personally. But they can work
with you to assess the possibility of what you can't
afford and help you avoid the pitfalls. Because, like Chuck
just mentioned, it sounds like that wasn't a huge problem
(24:03):
for his parents. But I have seen it work out
in a way where, oh, you know, quickly made this decision,
wasn't happy with it, and then the results of which
ruined our financial plan because we didn't really understand the
tax implications, the effect of getting rid of a locked
in low rate mortgage, all of these different factors that
go into where you're going to locate yourself in retirement.
(24:27):
If you have questions about that, maybe you're considering a relocation.
Maybe you're talking about a second home. Maybe you have
a second home that you're thinking about selling and trying
to understand the tax implications to that, the tax implications
of holding it for the rest of your life and
renting it versus selling it. All questions that a qualified
financial planner should help you to assess. If you have
(24:47):
questions along those lines, you want to talk to one,
please call the Armstrong Advisory Group at eight hundred three
nine three four zero zero one. We have offices scattered
throughout New England where we meet folks in person. We
also have meetings over the phone via zoom. So really
happy to meet with anybody anywhere. Again that number for
the Armstrong Advisory Group, It's eight hundred three nine three
(25:08):
four zero zero one.
Speaker 1 (25:10):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial, tax and to state planning advisors before
making any investment decisions. Armstrong may contact you to offer
investment advisory services.
Speaker 3 (25:26):
Headline from Let's see this is Baron's as well job
market Strong. So why does it feel so hard to
find work?
Speaker 1 (25:32):
Well?
Speaker 2 (25:33):
Gee, let's start with the first part of that sentence.
Speaker 3 (25:35):
Maybe the job market isn't actually that strong. There's a
difference between how low the unemployment rate is and how
strong the job market is. And we've talked about this
over the last year, and that look, the unemployment rate
has actually risen at one point almost one percent from
its lows. That is not something that you see in
(25:56):
a ripping job market. In a ripping job market, unemployment
continues to cone. So anytime that unemployment is rising, even
if it's at a level that's historically low, it doesn't
mean that you have a strong job market.
Speaker 2 (26:08):
You've actually had a weakening one for much of this year.
Speaker 3 (26:11):
And this piece, you know, details a few people that have,
you know, sent out hundreds of applications and can't get anywhere.
And I just I have a ton of sympathy as
someone who's gone through that once in their life where
you're just like, it feels like nothing that you can
do can get anyone to even call you back. And
I'll tell you it, it sucks. But there's some stats
in here that I think are really useful too, and
(26:32):
that before the pandemic, according to Revellio Labs, they I guess.
Just look at job postings online and pull data from them.
Over eighty percent of the jobs listed each month were
filled within six months of the posting. As of April
of this year, the average job posting only is a
forty one percent probability of resulting in a new hire
(26:52):
in the following six months. So it's saying that companies
have had the postings out there, but they're getting filled
at half the rate they were pre pandem and that
could be because of a couple things. It could be, hey,
companies are more discerning right now. It could be that
the postings are old and stale and they're not really
hiring for those positions.
Speaker 2 (27:11):
Like it could be.
Speaker 3 (27:12):
Any number of different things. But every metric that we
have out there shows that the rate of hiring has
been slowing for the last twelve to eighteen months, and
that to me, is not indicative of a strong labor market.
I don't think you say, like, oh, this is like
a terrible one, because the overall unemployment rate still remains low,
but you kind of grade it out and you're like, yeah,
(27:33):
it's kind of the middle.
Speaker 2 (27:34):
Of the pack.
Speaker 3 (27:34):
It's not very dynamic in particular, and that's something that
I think you can say definitively about.
Speaker 4 (27:39):
Yeah, it's a little bit stale. Employers are holding on
to their workers but not necessarily expanding teams. What you're
not dealing with is, you know, they talk about the
graduate with a master's and quantitative economics from San Francisco
State Business School, and like he's having a tough time
finding a job. He's also not competing for those jobs
(28:01):
with a bunch of laid off you know, master's degrees,
people who have the same job experience. And so I
don't think it's the twenty ten job market that we're
facing right now in terms of that difficulty. The one
thing I will say that's very different today from Chuck,
when you and I were applying for jobs, for instance,
in the wake of the Great Financial Crisis. The ease
(28:22):
at which you can apply to a job today, and
therefore the number of applications that go into every single job,
regardless of the state of the labor market, that's very
much changed. It's not that those tools didn't really exist,
but they were still in their infancy back in two
thousand and nine, ten, twenty eleven, and from what I
have seen firsthand, every time you open a job here,
(28:44):
you get hundreds of applications because it is so easy
to do now, and so standing out is tougher to
take a.
Speaker 2 (28:51):
Quick break here. When we come back stack room Let.
Speaker 1 (28:57):
If you missed any of today's show, catch up whenever
you want to our YouTube page find daily show segments
and full shows. Just go to YouTube dot com and
search for the Financial Exchange. This is your home for
breaking business and financial news. This is the Financial Exchange
Radio Network. The Financial Exchange streams live on YouTube. Like
our page and stay up to date on breaking business
(29:19):
news all morning long. This is the Financial Exchange Radio Network.
Speaker 4 (29:33):
Mike, what do you got for stack roulet Ah, winter
is coming? Felt it this morning when I got out
of bed, had the oil kick on this morning and
just taking a look at what that's going to cost
this year. But before I even get there, have you
two ever explained you do you het your home with oil?
Tucker natural gas gas, Chuck gas, Well, I'm still on oil. Okay,
(29:56):
wellser explaining to somebody not for the Northeast NERD cluster.
Like you know, I have a bunch of family in
Arizona who's lived either in California or Arizona. Their whole
lives and explaining to them how it works around here,
they get so confused, like what do you mean oil?
Like where do you get the oil? And so you
explain to them that a truck comes every few a
(30:18):
little well in the back of my house, and they're like, well,
do you have to be there? Was like, now there's
a little hole that they put all the oil in.
It just goes directly into And it's so confounding to
anybody who just has, you know, logical systems of delivering heat,
like an underground pipe that feeds not gas into their home.
But that's not how I do it, and how you know,
millions of New Englanders and Northeasterners do it. But nonetheless,
(30:40):
home heating oil pretty significantly cheaper than it was this
time last year. So a few factors obviously go into
how much it's going to cost to heat your home
this season, but I think most of them are working
in favor of a cheaper season one. Obviously, just home
heating oil prices are down. According to the Saint Louis
Fan I'm looking at number two heating oil from the
(31:02):
New York Harbor.
Speaker 2 (31:04):
What's number one?
Speaker 4 (31:05):
I don't know this time last year, we were looking
at three bucks per gallon. Today we're looking at about
two bucks a gallon, So pretty significant downtick from where
we were this time last year. It moved down throughout
the winter last year with a few upticks, But the
second piece would be every year away from COVID, we
(31:26):
get there's less time being spent at home. So last winter,
my wife was still working at home at least seventy
five percent of the time, heating the home a little
bit more than we will this winter, and I think
that's the case for a lot of northeasterners as well.
So I'm looking forward to a slightly cheaper home heating season.
Speaker 3 (31:44):
Mike, I know that it's my choice for stack roulette,
but I'm gonna make me choose. Yes, I'm gonna make
you choose for me. Just I'm my mental fortitude is
just gone gone at this point.
Speaker 2 (31:55):
Do you want to talk about AI solving a meal planning?
Speaker 4 (31:59):
I had that one too, AI Solving meal Planning?
Speaker 2 (32:02):
Okay, okay, we got to tuck. We're here, you know,
we're cool. We're doing it anyways. Uh, it's titled AI
Solves My most.
Speaker 3 (32:11):
Annoying chore meal planning for a toddler, and I do
think this is really interesting, not in that well, look,
first of all, this.
Speaker 2 (32:19):
Would never work in my household. For never work.
Speaker 4 (32:23):
Whose most annoying chor is meal taling for a toddler
like this? You have to clean puke and poop after
this thing.
Speaker 2 (32:31):
Those aren't annoying.
Speaker 4 (32:33):
I didn't love it. Okay, you have to scrub toilet
bowls and dust. I'll take the meal planning. I've never dusted.
Speaker 1 (32:41):
Who dost? Like?
Speaker 2 (32:43):
What? What? Why would anyone dust?
Speaker 3 (32:45):
All it does is take the dust and move it
from the ground where it's not bothering any right?
Speaker 2 (32:49):
Can we get back into the air?
Speaker 4 (32:52):
I can't do for it. I find less annoying meal planning.
Speaker 3 (32:55):
So I do think that the AI meal planning is
actually kind of interesting in that when I read this,
I said, okay, like, let me go to chat GPT
and just build me a meal plan because my wife
and I we get into a thing that probably most
families do at some point where it's like, man, it
feels like we're eating the same thing every week, like
we could really use something new instead of the same
old recipes.
Speaker 2 (33:15):
In my house, No, god, no, what you're doing? New stuff?
All the time.
Speaker 3 (33:21):
No, it's the same stuff mac and cheese, and yes, okay, good,
good good. Anyway, so I said, look, I literally just
typed in build me a meal planned for dinners for
the week, and it came up with seven days of them.
Speaker 2 (33:36):
Look.
Speaker 3 (33:37):
I might not like all of them, but all I
need to do is get like two new things in
a week and then I can figure out the rest
of it around there. And so it's like, hey, here's
like a lemon grilled herb chicken. Here is baked salmon
with sweet potato and a spare I guess, turkey meatballs
with zoodles and marinerosos.
Speaker 4 (33:54):
I don't even know what a zoodle is on a
zucchini noodle.
Speaker 2 (33:57):
No thanks, I'm not a big zucchini fan.
Speaker 3 (33:59):
So maybe I could sub regular pasta, but fine, turkey
meatball sound great. Veggie tacos, shrimp and veggie pie stuff
bell peppers.
Speaker 4 (34:06):
So I have two questions about this one. Does everyone
plan separate meals for their toddlers? Yes?
Speaker 2 (34:12):
No, yes, yes sucks.
Speaker 4 (34:15):
We forced them to either you eat what's in front
of you or you can go find something in the
pantry on your own.
Speaker 2 (34:20):
Theaters of all time.
Speaker 4 (34:22):
But two. I guess my perhaps more important question for
this program would be who's making money on this? What
do you mean like this is a useful case for
artificial intelligence. I'm with you there. Who can monetize this? How?
How is this going to contribute to Microsoft or Google
(34:43):
ever making any money?
Speaker 2 (34:44):
I don't know.
Speaker 4 (34:45):
Yeah, either, interesting use case for artificially. I might try
it out, like it seems like an interesting way to
do things, and like, oh yeah, okay, these kids never
eat mushrooms, so give me, you know, a meal plan
for the next week that doesn't include mush rooms in
any of them and limits this stuff, or you know,
no heat because my kids won't eat spicy food.
Speaker 2 (35:06):
I'll tell you what I'm gonna do.
Speaker 3 (35:07):
Actually, next week, I'm going to I'm gonna ask it specifically,
gonna be like, look, it's fall, it's getting colder, because honestly,
I don't want veggie tacos on a thirty degree night
in November.
Speaker 4 (35:17):
This is how Chuck Ea eats rocks.
Speaker 3 (35:19):
Next week, I'm gonna ask chat GPT to build me
a menu for next week and the week after I'll.
Speaker 2 (35:26):
Tell you how it went.
Speaker 4 (35:27):
Looking forward to it, and.
Speaker 2 (35:30):
I'm excited. I gotta tell you. Let's take a quick break.
For the rest of the day.
Speaker 3 (35:34):
Stocks remain broadly up, with the S and p AP
third of a percent we'll see 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
(00:20):
any investment decisions. Armstrong Advisory and the advertisers heard on
this program do not endorse each other or their services.
Armstrong and Money Matters Radio do not compensate each other
for referrals and are not affiliated. This is The Financial
Exchange with Chuck Zada and Mike Armstrong, your exclusive look
at business and financial news affecting your day, your city,
(00:43):
your world. Stay informed and up to date about economic
and market trends plus breaking business news every day. The
Financial Exchange is a proud partner of the Disabled American
Veterans Department of Massachusetts. Help us support our great American
heroes by visiting DAV five K Boston and making a
donation today. The DAV five K Boston is presented by
(01:04):
Veterans Development Corporation. This is the Financial Exchange, with Chuck
Zada and Mike Armstrong.
Speaker 2 (01:13):
Kicking off hour two of the Financial Exchange.
Speaker 3 (01:15):
Today, it's Chuck, Mike and Tucker and stock's broadly in
positive territory here with the Dow up three hundred points,
the S and P five hundred twenty five, and the
NASDAG up ninety two, so about a half a percent
jump in equities. To kick things off today, you've got
the ten year US Treasury continuing its sell off, now
(01:36):
up another three point two basis points to four point
two six four percent, so closing in on you know,
seven tens of a percent, rising a seven tens of
a percent rise since the FED began cutting interest rates.
We also have oil, the big move down today, currently
down five point one seven percent, about three seventy one
(01:56):
on West Texas Intermediate.
Speaker 2 (01:58):
This on the back of.
Speaker 3 (01:59):
The Israeli strikes of Iranian military sites on Friday evening.
The oil market interpreting this and the Iranian response as
something that at least in the short term, takes away
some of those worst case scenarios as far as potential escalation.
We'll see where this goes over the course of the day.
As far as oil prices, at one point West Texas
(02:22):
Intermediate was down about six and a half percent, So
it's rallied off those lows.
Speaker 2 (02:28):
We'll see where it ends up going here.
Speaker 3 (02:30):
Also, the TRIPAA national average for gas prices continuing to
slide now at three point thirteen nationally. With this move
on West Texas Intermediate, within the next couple of weeks,
you would expect to be seeing the national average making
a run for a two in the first digit. We
got a potential you know, two ninety five to two
ninety eight siting coming up in the next couple of weeks.
(02:52):
If oil prices are able to hold in this range again,
we'll see if they actually do. Gold up to eighty
one ounce despite the you know, general kind of risk
off sentiment related to the Middle East gold saying, hey,
that's not where my bid is entirely coming from. And
so gold holding its ground pretty well today up to
ten and ounced to twenty seven fifty six and seventy cents. Mike,
(03:15):
anything else catching your eye?
Speaker 4 (03:17):
Not market related?
Speaker 2 (03:18):
Now what else is catching your eye? It's not market related?
Speaker 4 (03:21):
This piece from Nick Timrouse in the Journal here economous
is maybe like a deal on lunch or something. I
am looking for a deal on lunch. Do you got
any idea?
Speaker 3 (03:29):
No, I brought a turkey sandwich and I'm gonna be
wholly unsatisfied with it. Was one of those I'm unpacking
the turkey this morning and I'm like, you know, you know,
just a turkey.
Speaker 2 (03:40):
It just didn't feel good in part of it.
Speaker 4 (03:42):
Last week I got a part in your hands.
Speaker 3 (03:44):
No, last last week I had the best turkey man Like,
I was like, oh, this this is the good stuff,
you know, like loaded up this one.
Speaker 2 (03:51):
I'm looking at him like wimpy turkey.
Speaker 3 (03:55):
Kind of Rubbery's not sure if it's gonna work for me.
But anyways, Nick tim Morous is.
Speaker 4 (04:00):
Saying economists warn of new inflation hazards after election. So
I want to talk about in what world we actually
need to worry about this. And the frustration that I
have is it seems to me that our only criticism
of irresponsible government behavior, and by that I mean spending
(04:22):
and not raising taxes to correspond to that spending and
running up deficits higher, seems to come from a point
of short term inflation. And I think that over the
last fifty years, we've come up with enough evidence to
say that increased government spending on its own does not
uniformly increase inflation. You can get to a point where
(04:44):
it does, at least not in the United States. You
have very little evidence that that has been the case
until you've reached really, really high levels of spending like
we saw in the spring of twenty twenty. But even
then you also had to have completely mangled supply chains
to get you there. And so I just find it, well,
(05:05):
I find it not good from the perspective of if
this is our only criticism and it keeps failing as
a realistic criticism, then nobody's gonna actually be worried about
irresponsible government spending, which in my view, is a real
problem for our future. Well, so first thing, let's tackle
the first point first, which is, do you see anything
(05:27):
that you've heard from the campaign trail that is realistically
going to result in inflation in twenty twenty five the
likes of which we saw anytime over the last four years. No,
nor do I. And again it's not to say that
I think the policies coming from either side of the
campaign trail are good for our economy. I just don't
think they're going to spark nine percent inflation. No.
Speaker 2 (05:49):
I do think it's interesting that.
Speaker 3 (05:51):
Look, if we're going to be intellectually honest about the
government spending side of things, when's the last time you
actually had anyone running for president, not you know, the
House or the Senator, whatever, anyone running for president who
was serious McCain about managing the size of the deficits.
(06:12):
I did even give you Romney, okay, you know, like
Paul Ryan cut his bones being like, hey, I'm gonna,
you know, try to reign in federal spending. Yeah, and
like that. That was kind of a core thing there.
But ultimately, like it's been like at least twelve years
now since you had a candidate who was like, yeah,
we need to really focus on this as a thing,
(06:33):
because right now I got both campaigns promising to not
tax tips. Are both Is it just the Trump campaign
that's saying I'm not going to tax so security. Did
Harris go in on that too, I don't know at
this point. Yeah, it's preposterous that ever pros on this.
You just have you know, tax cuts being thrown around
left and right. You've got promises on additional spending. The
(06:55):
Harris campaigns like I'm gonna do like twenty five thousand
dollars down payment assistance and build three million more homes.
Speaker 4 (07:01):
Give all sorts of parents, you know, universal pre K
and right and pay childcare.
Speaker 2 (07:06):
Yeah.
Speaker 3 (07:06):
The Trump campaign now was saying, Hey, in a perfect world,
I'd love to get rid of the income tax.
Speaker 2 (07:09):
Okay.
Speaker 3 (07:10):
That's like me campaigning for seventh grade class presidents saying
that you're gonna get rid of homework.
Speaker 2 (07:13):
Like, okay, good luck with that, you know.
Speaker 3 (07:15):
Like, I just think we're in a world where we're
not being honest about what we need to do to
get our deficits to a manageable size. I'm not saying
you have to eliminate them, because remember, you know, I
hear all this talk, not all this talk, but you
talk to people and you'll hear, well, you know, wouldn't
it be great to run a surplus and listen. As
(07:39):
much as I might dislike large deficits, surpluses are worse
because that literally means that the government has taken in
more money than it knows what to do with. It's like, hey,
I don't like being taxed, but when I do, I
like to be taxed, So much that the government can't
spend all my money. No like that that's just not
that's not good either. But I think there's a place where, hey,
if you can get to running you know, one and
(08:02):
a half to two and a half percent annual deficits
instead of the five to seven percent annual deficits that
we're seeing now. Yeah, that that's like a reasonable place
to get to.
Speaker 2 (08:12):
And the issue that you.
Speaker 3 (08:13):
Run into on this from a long term inflationary perspective is, Hey,
let's say that you have a situation like what we
have now, which is, hey, federal government outlays on interest
are going to be somewhere between thirty and forty percent
of all revenue collected over the next several years. Right,
(08:36):
so before you even get to spend a dollar on
do D, do any anything else, Social Security, medicare, any
of that stuff, Before you get to spend any of that, hey,
thirty to forty percent of your tax revenue goes to
paying interest. So what it means is, hey, if you
want to be reasonable about how to you know, rain
those deficits in, then it's going to come at the
(08:57):
cost of short term economic growth. Because as much as
we might say, look you don't want to try to,
you know, just use government spending to grow the economy.
The fact is government spending still does grow the economy,
just not as efficiently as it does in the private sector.
Like you spend a dollar of government money, someone's still
getting that contract. So I think that when when we
(09:19):
try to be like intellectually honest about all of this,
it's something where the path towards getting these numbers sustainable
are Hey, it's going to take some pain from all
of us in some different ways.
Speaker 2 (09:32):
In order to do so.
Speaker 3 (09:34):
And we haven't really been good at stomaching political pain.
Speaker 4 (09:38):
No recently now, not a whole lot of politicians running
on the ask not what your country can do for you? Right,
Like it's no, like, definitely ask what your country can
do for you, because we can cut all sorts of
taxes and give you all sorts of money. That's a
real problem.
Speaker 3 (09:55):
Yeah, who's actually like again, you might not like either
one of these things.
Speaker 2 (09:59):
You might like one of them, might like both of them.
I don't know.
Speaker 3 (10:02):
Like there's some people who are just you know, kind
of masochists on all the side of all this stuff.
Who's the candidate out there is gonna be like I'm
gonna raise your taxes and cut spending.
Speaker 4 (10:11):
Yeah, I don't hear from that person.
Speaker 3 (10:14):
They don't exist right now. And I'm not saying you
have to get to like some crazy austere place. I'm
not saying that you have to run surpluses because again,
I'm not not a surplus dude, man.
Speaker 4 (10:26):
And that's my question is what changes. It seems to
me that something has to blow up in your face
to change that. It seems to me that we actually
have to send people so security checks that are twenty
percent lower than the one they got through the month
before before people finally wake up and like, oh yeah,
this thing's an actual problem here.
Speaker 3 (10:45):
What American needs in order for that to happen is
its own head of lettuce moment. Yeah, just a big
slap in the face, you know, for those who don't
understand the head of Lettuce reference. Theresa May comes in
and says, hey, here's my budget for uh, you know,
for the UK, and what happened to UK bonds? They
sold off like one and a half percent in the
(11:06):
span of a week and that was the end of
Teresa May. Like it was that government was gone. Yeah again,
she did not last last longer than the head of Lettuce.
There's a Twitter account that tracked it had a head
of Iceberg Lettuce in the Lettuce one was still there
in Teresa May was not in power anymore.
Speaker 2 (11:26):
That was her government, right, am I make yeah?
Speaker 4 (11:27):
I think.
Speaker 3 (11:28):
Yeah. They've gone through like a bunch over there in
the last few years. It's kind of hard to keep up.
Speaker 2 (11:33):
Sometimes.
Speaker 1 (11:34):
Find daily interviews and full shows of the Financial Exchange
on our YouTube page. Like us on YouTube and get
caught up on anything and everything you might have missed.
This is the Financial Exchange Radio Network. Text us six
one seven, three, six two thirteen eighty five with your
comments and questions about today's show and let us know
what you think about the stories we are covering. This
(11:57):
is the Financial Exchange Radio Network.
Speaker 4 (12:00):
I'm finally starting to get some reasonable market data out
of my children here because, without saying the name here,
my kids are obsessed with this candy.
Speaker 3 (12:08):
Oh interesting, yeah, interesting, Mike. You ever been to Dingman's Ferry?
Speaker 4 (12:14):
I love weird down names. I have not been to
Dingman's Ferry unless I've accidentally driven through it, but I've
certainly not stopped in Dingman's.
Speaker 3 (12:23):
I quote here in Dingman's Ferry, Pennsylvania, less than fifty
miles from President Joe Biden's hometown of Scranton, where unemployment
fell to a record low of two point seven percent
in April.
Speaker 4 (12:32):
Where did the two point seven percent was that Scranton
or Dingman's Ferry?
Speaker 3 (12:35):
Don't know, poorly constructed sentence surgeon, consumer prices unleased by
the COVID nineteen pandemic or similarly subdued. Weiss Markets Incorporated,
the chain of two hundred grocers, mostly in the Keystone State.
Earlier this month sold a choice Porterhouse steak for seven
to ninety nine a pound to one of its regular customers.
Speaker 4 (12:52):
Just one.
Speaker 2 (12:54):
Listen.
Speaker 3 (12:55):
There's a lot of problems that I have with this piece,
quite honestly. The first is ding like the way that
it's talked about here. You're like, oh, that must be
some like bustling metropolis wherever.
Speaker 2 (13:07):
To quote from.
Speaker 3 (13:08):
Wikipedia, Dingwin's Ferry is an unincorporated township unincorporated community in
Delaware Township, Pike County, Pennsylvania. As of twenty fourteen, it
had a population of just over one thousand people.
Speaker 4 (13:19):
How do they even have a grocery store? Fine?
Speaker 3 (13:22):
Look, everyone's entitled the groceries. I don't want to be
like take away their grocery.
Speaker 2 (13:26):
Store, which I know I do.
Speaker 3 (13:27):
I'm running out, I know is not what you were saying,
but like, why is some random town of a thousand
people in Pennsylvania representative of what meat prices should be
in the country.
Speaker 4 (13:39):
Let me just ask you. Are you, Chuck and Tucker
getting used to grocery prices because I'm getting there, especially
now that I've stopped shopping at Wegman's for like every
one of my grocery shops.
Speaker 3 (13:53):
I do all my shopping at DJs now, and I
will tell you it does a lot to make you
feel great about prices. I picked up I think it
was either six or seven pounds of pork chops last
night eleven Bucks.
Speaker 4 (14:04):
Yeah, I'm having a lot more shopping going on at
market Basket, and I'm always happy whenever I leave market Basket.
And I know that prices are up there too, But
I'm starting to settle in here. I'm starting to settle
in here now that there hasn't been an entire shelf
missing of products that I need. Now that you know
(14:24):
I've been paying these higher prices for over a year,
It's not that I love it. It's not that I
enjoy that most of my groceries are twenty to twenty
five percent more expensive, but I am starting to get
used to it.
Speaker 3 (14:36):
Yeah, I mean again, I've changed my behavior in that
I'm not shopping at traditional grocery stores for my groceries anymore,
partly because again, the idea of spending like however much
it is for a pint of blueberries, only to see
my one year old eat the whole thing at once,
I know it is like right in that ballpark, yeah, for.
Speaker 2 (14:58):
Two of them. So again, like you get more for
your money.
Speaker 3 (15:01):
And that's the adjustment that I've made, and I'm not
going back, because I do find grocery prices still too
high for the sheer volume of food that I need
to buy right now.
Speaker 4 (15:14):
In part again, We've talked about this piece a lot,
but wage gains have gone up to and according to
the Bureau of Economic Analysis, which we cite data from frequently,
spending on food right now makes up less than seven
and a half percent of consumer spending. That's the lowest
(15:34):
since before the pandemic in February of twenty twenty. So again,
I know that sounds strange. It doesn't make you feel
incredibly great because your total spending buckets still might have increased.
But again, when you compare food spending right now to
incomes and to where they've been historically, we're not facing
(15:55):
a truly outsized overall effect. It's just really uncomfortable because
you do it every week.
Speaker 3 (16:02):
And the places where stuff still is uncomfortably moving up
is in places that is that are still having a
big impact though, you know, auto insurance rates and home
insurance rates and stuff like that that can make food
spending feel a little bit tighter because you're like, oh,
I've eaten through more of my stuff to get more
of my paycheck to get here. But yeah, on the
food prices, i'd say, yes, I'm kind of settled into
(16:25):
where I am. I did change my behavior about a
year or so ago, which again also coincided with, hey,
you have another kid, so maybe that changed more than
anything else. But I think ultimately we are seeing prices
stabilized now that they're not going to go down and
mass because that's just not how it works. Yeah, not usually,
(16:49):
And everyone who roots for deflation has never lived through
a deflationary cycle. If you know, anyone who was, you know,
in their teens in the eighteen nineties, give them a
call and ask him what it was like during the
three different banking panics that we had that decade, because
it was probably bad to quite bad. But again, you're
gonna have a hard time finding one hundred and forty
(17:10):
year old to talk to these days.
Speaker 2 (17:13):
There's just not many of them around it.
Speaker 4 (17:14):
Yeah, yeah, I would hope that. You know, we've seen
food prices change people's grocery shopping behavior. Maybe we will
see auto insurance rates change people's car buying behavior, although
I kind of doubt it, but that'd be good. Get
people to stop, you know, spending sixty thousand dollars on
cars when they make forty thousand dollars a year.
Speaker 3 (17:35):
And it would be fascinating if the thing that finally
turns the tide there is people just fed up with
insurance premiums and they're like, yeah, give me the civic Yeah,
I'd love that.
Speaker 1 (17:49):
Bringing the latest financial news straight to your radio every day,
it's The Financial Exchange on the Financial Exchange Radio Network.
Any of the show. The Financial Exchange Show podcast is
available on Apple, Spotify, and iHeartRadio. Hit the subscribe button
and leave us a five star review. This is the
(18:10):
Financial Exchange Radio Network.
Speaker 3 (18:13):
Mike, We've got a piece in the stack today, this
one from barons to owning a vacation home in a
hurricane zone is worrisome some owners are selling.
Speaker 4 (18:24):
As evidence by the fact that home prices in Florida
are currently heading down.
Speaker 3 (18:30):
Yeah, and you've got inventory throughout the state now higher
than it was pre pandemic. And look, I think that
it's important to recognize a couple of different things here.
The first is, Hey, there's something happening in the Florida
insurance market, for the Florida home insurance market that is
really kind of breaking the real estate market the way
(18:51):
that it used to operate. You have premiums that in
a lot of cases are now up anywhere from like
three hundred to six hundred percent over the last five
six years.
Speaker 2 (18:58):
Yeah.
Speaker 3 (19:00):
The other thing that you do have to remember about Florida,
there's three things actually not too The other thing you
have to remember, Hey, back in twenty twenty one and
twenty twenty two, a ton of people packed up from
all over the country, in particular the northeast and expensive
parts of the country, and moved to Florida because they said, Hey,
I'm working remotely, this is great. And some of those
(19:21):
trends have kind of reversed now, so you've got that
reversal that's happening.
Speaker 2 (19:26):
The third thing to remember is.
Speaker 3 (19:28):
Like every three years, Florida goes through a mini property
cycle where they build way too much, a bunch of
people move, then they keep building. Oh no, now we've
built too much, a bunch of people like leave, prices
go down. So it's this hugely cyclical market to begin with.
And they're in the middle of one of those as well,
because they built a ton back in twenty two and
twenty three since they thought a bunch of people were coming,
(19:49):
and now it's kind of stopped. So it's tough to
untangle what is they might come back to over and over,
like what's permanent and what is just a short term glitch.
Speaker 4 (19:59):
Yeah, and it's tough because real estate as an asset
class in a lot of ways is so incredibly attractive,
mainly because the way we fund the purchase. It's not
anything especially unique about primary residences or vacation homes, easy
leverage for people, it's just there's no other asset you
can buy with a thirty year fixed rate loan that
(20:21):
you only have the option to get cheaper over time.
Warn Buffets talked about this recently. He's like, there's nothing
else out there you can say, Okay, yeah, I'm taking
out a loan. It's going to be paid back over
thirty years. The rate will never go higher, but if
it goes lower, then I can lock that in instead.
There's nothing like it, and so there are still a
lot of attractive pieces here. But yeah, I think for
(20:43):
a lot of people, whether it's in Florida or anywhere else,
the idea of heading into their sixties and seventies and
even eighties with a couple of different properties to think
about and worry about is becoming less and less appealing.
Speaker 3 (20:59):
And so I think with Florida and trying to untangle
what is going on in that market, it's going to
take a little bit of time, but it certainly isn't
going to look good for you know, the next couple
of years, just because again you look at the listings there.
But as you know, Mike, it's it's one of those
questions facing retirees, which is, hey, do I go and
(21:22):
you know, buy a second place that I use or
do I uproot my primary residence. And we talk about
this an awful lot in terms of, Hey, when you're
building a financial plan, you've got a factor in the
cost of living. If you're considering moving somewhere, what does
that cost of living look like? And for a lot
of people that have moved down to Florida in the
last five years, the cost of living analysis they might
(21:44):
have done five years ago is completely outdated with how
the state has evolved.
Speaker 1 (21:47):
Now.
Speaker 4 (21:48):
Yeah, I think there's the relocation argument, which again, you know,
can still make a lot of sense depending on which
high tax state you're moving to and which hopefully low
tax states you're moving to. The you know, the interesting
piece about that second property to me is that for years,
financial wise, it has made sense to buy. It has
(22:08):
been a more compelling offering if you're spending six months
of a year in a different place to own something
rather than renting. That's also changing. But where I see
people run into it frequently is they purely look at
it as a financial scenario. And that can be good,
but it doesn't account for unpredicted things like the homeowner's
insurance market going up by three to six hundred percent.
(22:29):
It also doesn't account for the quality of life piece,
and I think people for some reason intentionally avoid this
when it comes to their own retirement plans. They're super
focused on the numbers and instead maybe it should be
focused on Okay, yeah, it is going to be more
expensive for me to rent a place for three months
down in Florida in peak season, but is it worth
(22:50):
it to me?
Speaker 3 (22:50):
Well, and I'll give you just an example just from
my own life. My parents, when they were I don't know,
mid sixties, decided they were going to move to to
North Carolina and they did that and they had a
great time down there. When my wife and I started
having kids, they said, look, we want to be closer
to you guys. Even though it's more expensive. They did,
like the opposite of what everyone ever does. They move
(23:12):
back to the Northeast. They're like, yeah, bring on this,
and granted, like they still go when they might rent,
you know, a couple of weeks down in Florida and
a couple weeks in North Carolina now, so they still
do those things just to get away. But it's not
just the financial stuff that you need to focus on
in retirement, because look, like, yes, you might pay less
in taxes in Florida, but you might make that up
(23:34):
spending on you know, trips to go up to see
the grand kids and stuff. When it's all said and
done and it's more hassle and as you get older,
you just don't want to fly as much.
Speaker 4 (23:41):
Well, if you're facing that type of scenario, got bad
news for you. Financial advisor can't tell you where you're
going to be happier in retirement. No, I have no
ability to measure that one personally. But they can work
with you to assess the possibility of what you can't
afford and help you avoid the pitfalls. Because, like Chuck
just mentioned, it sounds like that wasn't a huge problem
(24:03):
for his parents. But I have seen it work out
in a way where, oh, you know, quickly made this decision,
wasn't happy with it, and then the results of which
ruined our financial plan because we didn't really understand the
tax implications, the effect of getting rid of a locked
in low rate mortgage, all of these different factors that
go into where you're going to locate yourself in retirement.
(24:27):
If you have questions about that, maybe you're considering a relocation.
Maybe you're talking about a second home. Maybe you have
a second home that you're thinking about selling and trying
to understand the tax implications to that, the tax implications
of holding it for the rest of your life and
renting it versus selling it. All questions that a qualified
financial planner should help you to assess. If you have
(24:47):
questions along those lines, you want to talk to one,
please call the Armstrong Advisory Group at eight hundred three
nine three four zero zero one. We have offices scattered
throughout New England where we meet folks in person. We
also have meetings over the phone via zoom. So really
happy to meet with anybody anywhere. Again that number for
the Armstrong Advisory Group, It's eight hundred three nine three
(25:08):
four zero zero one.
Speaker 1 (25:10):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial, tax and to state planning advisors before
making any investment decisions. Armstrong may contact you to offer
investment advisory services.
Speaker 3 (25:26):
Headline from Let's see this is Baron's as well job
market Strong. So why does it feel so hard to
find work?
Speaker 1 (25:32):
Well?
Speaker 2 (25:33):
Gee, let's start with the first part of that sentence.
Speaker 3 (25:35):
Maybe the job market isn't actually that strong. There's a
difference between how low the unemployment rate is and how
strong the job market is. And we've talked about this
over the last year, and that look, the unemployment rate
has actually risen at one point almost one percent from
its lows. That is not something that you see in
(25:56):
a ripping job market. In a ripping job market, unemployment
continues to cone. So anytime that unemployment is rising, even
if it's at a level that's historically low, it doesn't
mean that you have a strong job market.
Speaker 2 (26:08):
You've actually had a weakening one for much of this year.
Speaker 3 (26:11):
And this piece, you know, details a few people that have,
you know, sent out hundreds of applications and can't get anywhere.
And I just I have a ton of sympathy as
someone who's gone through that once in their life where
you're just like, it feels like nothing that you can
do can get anyone to even call you back. And
I'll tell you it, it sucks. But there's some stats
in here that I think are really useful too, and
(26:32):
that before the pandemic, according to Revellio Labs, they I guess.
Just look at job postings online and pull data from them.
Over eighty percent of the jobs listed each month were
filled within six months of the posting. As of April
of this year, the average job posting only is a
forty one percent probability of resulting in a new hire
(26:52):
in the following six months. So it's saying that companies
have had the postings out there, but they're getting filled
at half the rate they were pre pandem and that
could be because of a couple things. It could be, hey,
companies are more discerning right now. It could be that
the postings are old and stale and they're not really
hiring for those positions.
Speaker 2 (27:11):
Like it could be.
Speaker 3 (27:12):
Any number of different things. But every metric that we
have out there shows that the rate of hiring has
been slowing for the last twelve to eighteen months, and
that to me, is not indicative of a strong labor market.
I don't think you say, like, oh, this is like
a terrible one, because the overall unemployment rate still remains low,
but you kind of grade it out and you're like, yeah,
(27:33):
it's kind of the middle.
Speaker 2 (27:34):
Of the pack.
Speaker 3 (27:34):
It's not very dynamic in particular, and that's something that
I think you can say definitively about.
Speaker 4 (27:39):
Yeah, it's a little bit stale. Employers are holding on
to their workers but not necessarily expanding teams. What you're
not dealing with is, you know, they talk about the
graduate with a master's and quantitative economics from San Francisco
State Business School, and like he's having a tough time
finding a job. He's also not competing for those jobs
(28:01):
with a bunch of laid off you know, master's degrees,
people who have the same job experience. And so I
don't think it's the twenty ten job market that we're
facing right now in terms of that difficulty. The one
thing I will say that's very different today from Chuck,
when you and I were applying for jobs, for instance,
in the wake of the Great Financial Crisis. The ease
(28:22):
at which you can apply to a job today, and
therefore the number of applications that go into every single job,
regardless of the state of the labor market, that's very
much changed. It's not that those tools didn't really exist,
but they were still in their infancy back in two
thousand and nine, ten, twenty eleven, and from what I
have seen firsthand, every time you open a job here,
(28:44):
you get hundreds of applications because it is so easy
to do now, and so standing out is tougher to
take a.
Speaker 2 (28:51):
Quick break here. When we come back stack room Let.
Speaker 1 (28:57):
If you missed any of today's show, catch up whenever
you want to our YouTube page find daily show segments
and full shows. Just go to YouTube dot com and
search for the Financial Exchange. This is your home for
breaking business and financial news. This is the Financial Exchange
Radio Network. The Financial Exchange streams live on YouTube. Like
our page and stay up to date on breaking business
(29:19):
news all morning long. This is the Financial Exchange Radio Network.
Speaker 4 (29:33):
Mike, what do you got for stack roulet Ah, winter
is coming? Felt it this morning when I got out
of bed, had the oil kick on this morning and
just taking a look at what that's going to cost
this year. But before I even get there, have you
two ever explained you do you het your home with oil?
Tucker natural gas gas, Chuck gas, Well, I'm still on oil. Okay,
(29:56):
wellser explaining to somebody not for the Northeast NERD cluster.
Like you know, I have a bunch of family in
Arizona who's lived either in California or Arizona. Their whole
lives and explaining to them how it works around here,
they get so confused, like what do you mean oil?
Like where do you get the oil? And so you
explain to them that a truck comes every few a
(30:18):
little well in the back of my house, and they're like, well,
do you have to be there? Was like, now there's
a little hole that they put all the oil in.
It just goes directly into And it's so confounding to
anybody who just has, you know, logical systems of delivering heat,
like an underground pipe that feeds not gas into their home.
But that's not how I do it, and how you know,
millions of New Englanders and Northeasterners do it. But nonetheless,
(30:40):
home heating oil pretty significantly cheaper than it was this
time last year. So a few factors obviously go into
how much it's going to cost to heat your home
this season, but I think most of them are working
in favor of a cheaper season one. Obviously, just home
heating oil prices are down. According to the Saint Louis
Fan I'm looking at number two heating oil from the
(31:02):
New York Harbor.
Speaker 2 (31:04):
What's number one?
Speaker 4 (31:05):
I don't know this time last year, we were looking
at three bucks per gallon. Today we're looking at about
two bucks a gallon, So pretty significant downtick from where
we were this time last year. It moved down throughout
the winter last year with a few upticks, But the
second piece would be every year away from COVID, we
(31:26):
get there's less time being spent at home. So last winter,
my wife was still working at home at least seventy
five percent of the time, heating the home a little
bit more than we will this winter, and I think
that's the case for a lot of northeasterners as well.
So I'm looking forward to a slightly cheaper home heating season.
Speaker 3 (31:44):
Mike, I know that it's my choice for stack roulette,
but I'm gonna make me choose. Yes, I'm gonna make
you choose for me. Just I'm my mental fortitude is
just gone gone at this point.
Speaker 2 (31:55):
Do you want to talk about AI solving a meal planning?
Speaker 4 (31:59):
I had that one too, AI Solving meal Planning?
Speaker 2 (32:02):
Okay, okay, we got to tuck. We're here, you know,
we're cool. We're doing it anyways. Uh, it's titled AI
Solves My most.
Speaker 3 (32:11):
Annoying chore meal planning for a toddler, and I do
think this is really interesting, not in that well, look,
first of all, this.
Speaker 2 (32:19):
Would never work in my household. For never work.
Speaker 4 (32:23):
Whose most annoying chor is meal taling for a toddler
like this? You have to clean puke and poop after
this thing.
Speaker 2 (32:31):
Those aren't annoying.
Speaker 4 (32:33):
I didn't love it. Okay, you have to scrub toilet
bowls and dust. I'll take the meal planning. I've never dusted.
Speaker 1 (32:41):
Who dost? Like?
Speaker 2 (32:43):
What? What? Why would anyone dust?
Speaker 3 (32:45):
All it does is take the dust and move it
from the ground where it's not bothering any right?
Speaker 2 (32:49):
Can we get back into the air?
Speaker 4 (32:52):
I can't do for it. I find less annoying meal planning.
Speaker 3 (32:55):
So I do think that the AI meal planning is
actually kind of interesting in that when I read this,
I said, okay, like, let me go to chat GPT
and just build me a meal plan because my wife
and I we get into a thing that probably most
families do at some point where it's like, man, it
feels like we're eating the same thing every week, like
we could really use something new instead of the same
old recipes.
Speaker 2 (33:15):
In my house, No, god, no, what you're doing? New stuff?
All the time.
Speaker 3 (33:21):
No, it's the same stuff mac and cheese, and yes, okay, good,
good good. Anyway, so I said, look, I literally just
typed in build me a meal planned for dinners for
the week, and it came up with seven days of them.
Speaker 2 (33:36):
Look.
Speaker 3 (33:37):
I might not like all of them, but all I
need to do is get like two new things in
a week and then I can figure out the rest
of it around there. And so it's like, hey, here's
like a lemon grilled herb chicken. Here is baked salmon
with sweet potato and a spare I guess, turkey meatballs
with zoodles and marinerosos.
Speaker 4 (33:54):
I don't even know what a zoodle is on a
zucchini noodle.
Speaker 2 (33:57):
No thanks, I'm not a big zucchini fan.
Speaker 3 (33:59):
So maybe I could sub regular pasta, but fine, turkey
meatball sound great. Veggie tacos, shrimp and veggie pie stuff
bell peppers.
Speaker 4 (34:06):
So I have two questions about this one. Does everyone
plan separate meals for their toddlers? Yes?
Speaker 2 (34:12):
No, yes, yes sucks.
Speaker 4 (34:15):
We forced them to either you eat what's in front
of you or you can go find something in the
pantry on your own.
Speaker 2 (34:20):
Theaters of all time.
Speaker 4 (34:22):
But two. I guess my perhaps more important question for
this program would be who's making money on this? What
do you mean like this is a useful case for
artificial intelligence. I'm with you there. Who can monetize this? How?
How is this going to contribute to Microsoft or Google
(34:43):
ever making any money?
Speaker 2 (34:44):
I don't know.
Speaker 4 (34:45):
Yeah, either, interesting use case for artificially. I might try
it out, like it seems like an interesting way to
do things, and like, oh yeah, okay, these kids never
eat mushrooms, so give me, you know, a meal plan
for the next week that doesn't include mush rooms in
any of them and limits this stuff, or you know,
no heat because my kids won't eat spicy food.
Speaker 2 (35:06):
I'll tell you what I'm gonna do.
Speaker 3 (35:07):
Actually, next week, I'm going to I'm gonna ask it specifically,
gonna be like, look, it's fall, it's getting colder, because honestly,
I don't want veggie tacos on a thirty degree night
in November.
Speaker 4 (35:17):
This is how Chuck Ea eats rocks.
Speaker 3 (35:19):
Next week, I'm gonna ask chat GPT to build me
a menu for next week and the week after I'll.
Speaker 2 (35:26):
Tell you how it went.
Speaker 4 (35:27):
Looking forward to it, and.
Speaker 2 (35:30):
I'm excited. I gotta tell you. Let's take a quick break.
For the rest of the day.
Speaker 3 (35:34):
Stocks remain broadly up, with the S and p AP
third of a percent we'll see tomorrow on the Financial
Exchange
Popular Podcasts
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
NFL Daily with Gregg Rosenthal
Gregg Rosenthal and a rotating crew of elite NFL Media co-hosts, including Patrick Claybon, Colleen Wolfe, Steve Wyche, Nick Shook and Jourdan Rodrigue of The Athletic get you caught up daily on all the NFL news and analysis you need to be smarter and funnier than your friends.