Let's Talk Money

August 13th, 2023

Episode Transcript

(00:00):
Good morning, and welcome on thisSunday morning, folks. The summer is
flying by here we are August thirteenth. How the heck did that ever happen?
You know, it's funny the daysthat it doesn't rain, it's actually
pretty nice out. The problem isit's been raining a lot, like way
too much, so it looks likethe rain clouds are blowing through. I'm

(00:22):
doing the show this morning from Saratogadowntown Saratoga Springs, and I think we
had the last of the rain inthe Capitol Region area. So once that
blows through, it's supposed to bea pretty nice day. Go out and
enjoy it. But in the meantime, I can't thank you enough for tuning
in today. And if I canhelp you with anything financially speaking, give

(00:43):
me a call. The phone linesare open. One eight hundred talk w
g Y one eight hundred eight twofive five nine four nine Any questions whatsoever.
I know we had a great showyesterday. John and Nicole did the
show yesterday. They hit some goodinformation and great questions. Remember there's never
a silly question when it comes toyour financial future. One eight hundred eight

(01:07):
two five fifty nine forty nine onthis gorgeous Sunday. So you know,
Monday, you know, we hada four hundred point rally in the TAO,
and Tuesday we kind of lost someground when Moody's downgraded ten regional banks.
So if you're looking to get intothe financial services sector, you know

(01:33):
you might have another buying opportunity.It's really been been recovering pretty good.
But there's regional banks that were downgraded, and regional banks are you know,
they would be like a let's say, a Kate, a Key Bank,
or a Pioneer Bank or Trusco Bank. That's kind of what the regional banks

(01:55):
are. And year to date,you know, the SMP is up almost
seven percent. The big banks,the banks that you would find in the
SMP five hundred those type banks areup about two percent, and then the
regional banks they're down still here todate about eight percent. But they've come
a long way. I mean backin the beginning of May. I think

(02:21):
May the first week in May wasthe low point. That's that's when banks
were really beating up the worst.But they're they're they're bouncing back. But
on Tuesday, Moodes downgraded ten ofthem. China shook the markets on Wednesday
with consumer prices falling and a sharpdecline in their exports. And then you

(02:42):
know, Thursday stocks were down alittle bit. Us consumer prices cool in
Jay. In July they came down, you know, just kind of slowed
down a little bit. So forthe week, the Dow actually eked out
a small point six percent game SMPoff just a smidgeon, down point three

(03:04):
percent. NAZDAC was the big loser, down two percent. And that's because
when interest rates go up, thosegrowth stocks get hit the most, and
interest rates. You know, onceagain, folks, if if you're looking
to buy bonds, don't you know, don't wait. I keep saying,
when that ten year treasury hit fourpoint two percent a few months ago,

(03:25):
that was the high point, andso far it gets close. It got
as high as four point one eightthis week finished the week at four point
one five, almost four point onesix, and I think that's a pretty
decent rate. I don't think you'regoing to see that ten year go above
that high water mark. I couldbe wrong. If I am, I'll

(03:46):
let you know, but four pointtwo I think will be the high mark
for the ten year treasury. Andremember within weeks it went all the way
down the three point five And Isay that because if you bought a ten
year treasury when it was three pointfive a couple of months ago, you're
locked in for the next ten years. Getting three point five today, you

(04:06):
can almost get four point one sixpercent, And that's that's pretty good.
The short term bonds, they're justyou know, when you think you can
buy a three month, a sixmonth at almost five and a half percent,
that's pretty good for short term money. If you're not getting that and
you have money sitting in a bank, you may want to think about buying

(04:27):
three months, six months, evenin one year is yielding almost five point
four percent. We use that forclients that need money. Will we'll try
to max out the interest we canget for clients, to yield that we
can get for clients. So bondsare you know, as I said,
if you're looking, they add bondsto your portfolios. I kind of I

(04:48):
kind of like where where bonds are? I think I think it's pretty good
the you know, so let's let'slet's recap the week. As they said,
the SMP was down just a smidgeonpoint three month percent. The NASTAC
composite down one point nine. QQQwas only down one point six two.

(05:13):
So some of those big companies inthe NASTAC one hundred, is it kind
of it did not go down asmuch as all those other companies in the
NASTAC, So QQQ down one pointsix Here today you had the SMP up
just about sixteen point three percent.With dividends, it probably closer to seventeen

(05:34):
percent. The NASTAC is up thirtyalmost the thirty one percent. QQQ is
up almost thirty eight percent. Inotices had a couple of rough weeks.
It came off, you know,God, it was flying in the forty
I think the NASTAC one hundred composite, which is QQQ was up forty four

(05:56):
percent at one point Russell two thousandstill you know, under ten percent,
nine point three percent, And youknow, you're to date stocks are you
know, even though we're giving alittle bit back over the last couple of
weeks, you're to date stocks are. Man, they're they're they're hanging in
there pretty good. What's not doinggood? Because as I said, when

(06:17):
you see interest rates on those USTreasury bonds, and I feel they're the
safest, safest place in the worldif you want yield guarantees. I don't
think this great country of virus isgoing out of business. We know that
Fitch downgraded us not too long ago, and that was kind of a you

(06:38):
know, blow to our ego,let's say. And the reason why Fitch
downgraded US was because they just lookedat the mess in Washington and said,
these people just can't get off theirrear end and get things done. Listen,
folks, we got a financial problemcoming before us, and nobody in
Washington wants to fix it. Andthere's things they can do that won't affect

(07:00):
us. You're not going to loseyour Social Security You're not going to Believe
me, folks, You're not goingto be hurt. And there's things that
they can do to kind of slowdown this train wreck that we're on.
This country spending as much money asit's spending, it's just it can't go
on forever. But in Washington,we elect these officials and they just think

(07:23):
it can go on forever. Andbelieve me, folks, when you see
when you see this country print moneyand give money away, that is not
good for this country. And we'veprinted a lot of money over the last
couple of years, more money thanwe ever should have printed. And they
continue to want to print money.I mean, hopefully, hopefully they just

(07:46):
slow down and just enough is enough. They can't go on printing money.
And you know, it's just thinkingthe money we're sending the Ukraine. You
don't think we could use some ofthat money in this country. I mean,
we're sending money to Ukraine like there'sno tomorrow. It's it's it's it's
about time we got to rethink justwhere where our priorities are and our priorities

(08:11):
should be in this great country ofours, because there's a lot of cities
around this country that are in adisastrous state, just a mess, a
complete mess. Great cities that Icould care less if I ever go back
to visit cities that I used tolove the visit. You you you won't

(08:33):
see me take a trip to visitthese cities. I'm not going to say
ever, but not not in thenear future, that's for sure. And
it's it's just so sad. Peoplearound the world must be just laughing at
us how we're running this country.I mean, it's just it's just crazy.
One eight hundred talk w G yZach. Let me take a quick

(08:56):
fifteen second break and I'll be back, folks. I like this music,
little jazzy right on a Sunday morning. Thanks for tuning in folks today,
and if you have any questions,the full lines are open one eight hundred

(09:18):
eight two five five nine four nineone eight hundred eight two five fifty nine
forty nine. So I started tosay, you know the downside to getting
a pretty decent yield on bonds rightnow, it's mortgage rates. That thirty
year mortgage rate is up to sevenpoint six fifteen year mortgage trade is up

(09:39):
to six point eight percent, andthat's pretty high. I give this statistic
out when mortgage rates for three percent, if you wanted to buy a five
hundred thousand dollar house twenty percent downfor hundred thousand dollars mortgage, your mortgage
payment was about seventeen hundred dollars,and then all of a sudden, now

(10:00):
at seven percent that same four hundredthousand dollars mortgage, the mortgage payment goes
up about a thousand dollars twenty sevenhundred dollars, and folks, that's a
lot of money. So if yourbudget, if you can only afford seventeen
hundred dollars a month for principal andinterest. You can only afford about a
three hundred and twenty five thousand dollarshouse. That's the power of mortgage rates.

(10:24):
And I had a nice two daysin a row. I had a
nice conversation with two different realtors,Jen Holloway and then yesterday Kevin Clancy.
You've seen his ads with Barbara fromGod my Name's My mind's going flank.
I can't think of Barbara's last name. Oh, she's on the Shark Tank,

(10:48):
you know. I mean anyway,I saw Kevin Clancy yesterday at the
track and I was talking to himwhen we had a pretty lengthy conversation,
and he said, Steve, hesays, there's just no inventory because people
aren't looking to other house to turnaround and get into a new house with
mortgage rates being over seven percent,and it makes sense. You know,
why would you get rid of yourthree percent mortgage to get a new mortgage

(11:13):
seven eight percent? It would becrazy. So people aren't looking at list
their houses. They're not looking tokind of make a move or you know,
chomp down on a more expensive house. So with mortgage rates being as
high, it's affecting a whole lotin Zach Harris, Barbara Corker and that's

(11:33):
her name, Kevin Clancy and BarbaraCorker, and they're they're a team.
And as I said, Kevin doesa nice job. Barbara Corker and is
who he does his marketing with.Thank you, Zach. My mind went
blank at my age that happens.But as I said, you know,
two relators two days in a rowtalking about how there's just no inventory because

(11:58):
people, you know, where arethey going to go? You know,
think about it, just a fourhundred thousand dollars mortgage, thousand dollars a
month. There's a lot, especiallyfor somebody on a budget where if if
they could only afford seventeen eighteen,nineteen hundred dollars a month in mortgage payments,
they're they're you know, they're notgoing to go out there and get
a seven or eight percent mortgage.And you know, owning a home should

(12:24):
really be you know, just asmall percentage of your budget, but at
seven and eight percent, you know, you're you're you're spending a lot of
money on principle and interest. Sothat's the downside to interest rates being as
high as they are. Anybody lookingto borrow money, they're really paying a

(12:45):
deer price, whether it be fromhome or a business borrowing money to reinvest
back in their business, whatever itis, it's it's it's expensive. So
this is this is the downside tohigh mortgage rate. So the you know,
a couple of weeks ago, FitchFitch ratings moved to basically they they

(13:09):
notched the triple A credit rating thatthis great country of ours was under down
last week, and Wall Street seemsto be taking it in strides. Not
like when when this great country ofours had their their credit downgraded back in

(13:30):
two thousand and eleven, the marketsreally were pretty volatile, especially you know,
I think the markets were down tenpercent overnight and all because you know,
we for the first time ever wentfrom triple A down the double A
and that just wasn't good. Sohere you have two of the three credit

(13:50):
agencies you know, downgrading our creditand that's that's just not good. You
know, you look at why didFitch do this? You know, basically
you know, they're they're looking atwhat's going on, and they they don't
like the federal budget deficits that thiscountry is going through, and they don't

(14:13):
like the way Washington, you know, even with them playing games and you
know, listen, we raising thecredit. That credit is something that goes
on and on and on, butthey make a circus out of it in
Washington. I don't have a lotof respect for the people in Washington.

(14:35):
I guess you can kind of sensethat nothing gets done and nobody's looking to
fix anything. You know, thesepeople get elected and you know they're they're
in office one day and they're alreadylooking to get reelected because it's a pretty
darned good, you know gig.They get healthcare, benefits for life,
pension for life. I always say, listen, you and I and everybody

(14:58):
listen, we should get the samebenefits at our congressman, get right,
what's wrong with that? Why can'twe all be treated the same. And
you know, once they get intooffice, they get a taste of power,
they just don't want to give itup. Not all, not all
politicians are like that, but alot of politicians are. So you know,

(15:22):
we really have to get get ourhead on straight in Washington and really
look at at what we can doto not overspend The budget in this country
is no different than you your householdbudget. If you make fifty thousand dollars

(15:43):
a year, but you elect tospend sixty and you put money on credit
cards year in, year out,and all of a sudden you max out
your credit cards. Then what doyou do. Well, you're gonna have
to file bankruptcy to get out fromunderneath it. And then, you know,
most people, it's human nature.They start spending more than they're making

(16:07):
again, and it's it's just avicious cycle. And that's what's going on
with this country. If we havea five trillion dollar budget and we're spending
six six and a half trillion dollars, that's a trillion trillion and a half
that's going on the you know,the credit cards, we're borrowing that money.

(16:27):
And you know we're we're we're indebt over thirty trillion dollars. Folks,
there's twelve zeros in a trillion twelve, so we're in debt over thirty
trillion dollars. I'm telling you wehave to wrap our arms around that eight
hundred pound gorilla that's considered our ourour debt, our financial future. So

(16:53):
Fitch just in it like that anddowngraded US from Triple A to double A.
You know, it's just a littlenotch down, but the markets are
taking it in stride. When itfirst happened, I really thought, holy
cow, we're going to go throughanother violatile summer like we did in two
thousand and eleven. But as Isaid, the market seemed to seem to

(17:18):
be taking taking it in stride.As I sit here, I'm getting an
email from TransUnion. You know,the government lets you you know, as
long as we're talking about credit andso forth, the government lets you check
your your your your credit free onthem. You could get free credit reports
and everybody should do it once ayear. There's three big credit agencies and

(17:44):
you can check your credit report,and you should. Your credit report is
a summary of your personal credit history. Your credit report includes, you know,
things like your address, a stateof birth, information about you know,
your your your history and credit andhow you pay your bills or if
you filed for bankruptcy. And asI said, the three biggies, Equifox,

(18:08):
Experience and TransUnion, they collect anupdate disinformation. Not all creditors report
information to these credit bureaus, butmost nationwide. You know, if you
got a Macy's credit card or bankcredit card account. You know, loans,
they're all included in the credit report. And why is it important for

(18:32):
you to check it once a year? Because if somebody steals your identity,
and believe me, folks, ithappens. I just got my AT and
T mess fix. Imagine opening upyour AT and T you know, a
cell phone bill and seeing almost Ihad twenty eight phone lines that somebody hacked

(18:56):
into my AT and T account.Twenty eight phone lines were added to my
AT and T account. Think aboutthat, you know, your your your
your monthly bill just you know,quadruples overnight. And I tried to fix
it. I tried calling customer service. This went on for over two months

(19:19):
because in order to fix it,you have to get on the phone.
I was on the phone. Icall AT and T and you know the
gig they they send you somewhere overseasand you you you do your best to
explain the situation and not you knowthe communication. You know, when when
you're here talking to somebody you knowway far away, you get my my,

(19:45):
my, my point of frustration.It could just be, you know,
it doesn't always go smoothly and yoube on the phone. I was
on the phone six different times,forty five minutes, an hour, hour,
fifteen minutes, almost two hours,and I'd ask them every time,
listen, if we get cut off, promise me you'll call me right back.

(20:07):
Guess what, you know how manytimes I would get cut off and
guess what, nobody Nobody calls youback. Finally, finally, this last
week, I was on the phonewith somebody, and believe it or not,
an hour and a half into it, it was almost a three hour
conversation to fix this. An hourand a half into it, don't I

(20:29):
get cut off? Well you canonly imagine the profanity coming out of my
mouth. And I mean I justwanted to, you know, throw that
cell phone right out the window.Thank god the windows don't open in my
office or I might have done it, don't you believe it or not?
They called me back. Tony washer name. She called me back three

(20:53):
hours to fix this. So whereI'm going with this, folks, is
the gam artists out there. Theyare so clever and with AI, you
know, artificial intelligence, you knownow they can you know, they're they're
really really being clever, and youhave to be careful. And if you

(21:15):
have parents or grandparents, you haveto keep your eye on them because they're
being taken advantage of over and overand over again. So why should you
look at as long as the government'sputting the bill check your credit report,
because if somebody did get at youat your credit and you don't realize it,

(21:37):
you can fix it sooner than later. And for me, you know,
I signed up for a service thatif somebody tries to do it,
I get notified by TransUnion ironic thatthey're sending me an email as I'm talking
to you. So in order toin order to get this, you know,
you just you know, you goto your free credit reports, you
know God, and you know it'sit's it's it's there for you, so

(22:04):
you can, you know, fixany mistakes. Get a copy of it.
You you really should, folks,There's there's nothing like it. We're
coming up to the bottom of thehour. If you have any any questions
whatsoever. One eight hundred eight twofive five nine four nine one eight hundred
eight two five fifty nine forty nineany questions whatsoever. You're listening to Let's

(22:30):
talk money, brought to you byBouchet fin answer group where we help our
clients prioritize their health while we managetheir wealth for life. As they said,
we're gonna take a quick break forthe news. And on the other
side of the news, I wouldlove to talk to you. Annualcreditreport dot
com is where you go to getyour free credit reports. One eight hundred

(22:52):
eight two five five nine four ninesee in a quick couple of minutes.
Hello, folks, Thanks for tuningin today. I can't thank you enough
and hanging in through the news.I truly appreciate it. I would love
to talk to you if you haveany questions. One eight hundred eight two

(23:12):
five five nine four nine, giveme a call and you know, I'll
just wrap it up with this annualcredit report. As I said, free
credit reports. The federal law allowsyou you get a free copy of your
credit report every twelve months from eachcredit reporting company. Make sure that the
information on all your credit reports iscorrect up to date. Folks. It's

(23:37):
free and it's really important that youdo that. I can't begin to tell
you the scams that are that aregoing out there listening to what's what's happening.
I mean, I heard one friendwho who was taken woman befriended her

(24:02):
and long story short, talk herinto giving her like, you know,
tens of thousands of dollars that youknow she was going to invest, and
then she disappears. I mean,folks, they're clever. I can't begin
to tell you. And checking youryour annual credit report with these three credit
agencies experience, Equifax and TransUnion isimportant. So go to Annual Credit report

(24:30):
dot com to get a copy ofyour credit report and you get it free
once every twelve months. Something goodthat the country allows and you should take
advantage of it. So August ishas not been too good to us in
the stock marked. The last coupleof weeks have been down and we got

(24:51):
a couple of weeks to go.And you know, one of the things
that play into August not being goodis vacations. There's a a lot of
people that that are you know,taking a break. They're not on Wall
Street. You know a lot ofthe traders are out in the Hamptons.
And with lower you know, lowerparticipation, sometimes that can create more volatilities.

(25:15):
So August is just you know,not not not not not a good
month for us. You know theSMP as I said, down point three
percent and as back down one pointnine percent for the first couple of weeks.
It's down almost five percent so farin August. And you know,

(25:36):
you got those those big boys Apple, NA Video, all those those those
magnificent seven. You have Meta,which is Facebook, Amazon, Microsoft.
You know, they're they're still up, really up big time year to date,
but over the last week, youknow, they are two weeks they've

(26:00):
they've been kind of taking it,taking it on a on on the chin.
And then you have those defensive areasthat held up really good last year,
healthcare and utilities, but this year, you know, healthcare is kind
of flat year today. Utilities isactually down year today. So this year
it's just you know, just nota not a great place to be when

(26:25):
when when there's times of volatility,like last year, people flocked to those
defensive sectors. But this year,you know, since since the middle of
October, the stock market's been ona pretty good role and a great rally,
almost closing the gap, almost anew all time highs we'll get there
before you know it, We'll we'llsay, holy Kyle, the market made

(26:49):
an all time high. You know, I was scared to death back in
twenty twenty two, when I thoughtthe world was coming to an end and
it never did. And then onesector that really took it on the chin,
as I said, were financials.So on Tuesday, movies Investors services,
you know, they might they mighthave given you an opportunity if you

(27:11):
wanted to buy into these regional banks, you absolutely can. You got the
SMP bank and the regional bank,you know, a couple of etts.
The regional bank is is really thesmall boys, you know, the pioneers.

(27:32):
Let's say the trust goes of theworld. And year to date that's
that's still down eighteen percent. Thebanking sector as a whole, as I
said in the first half of theshow, is down almost nine percent.
The big financial institutions that trade inthe SMP up two percent compared to almost

(27:52):
seventeen percent return in the SMP.So financials are really really being hit.
But Moodies on Monday they had downgrades to ten different banks and putting you
know six and them on review fordown grade and giving negative outlooks to eleven
banks. So the regional banking sectorgot big, got Clobert, and if

(28:17):
you wanted to get in, youknow, now may be a good entry
point if you're looking at it toyour portfolio. We're not, but I'm
saying if you watch these these financialinstitutions in bank in the beginning of May
when they were really down more thanthirty forty percent, and all of a
sudden they recovered when you got anotherbreak this week, so you're to date,

(28:41):
the regional banks are down, asthey said, almost twenty percent,
the banking sector is a whole almostnine percent, and the big financial institutions,
which you really can't even call thembanks anymore because they do so much
more, you're to date up twopercent compared to the SMP up nineteen percent

(29:03):
one eight hundred eight two five fivenine four nine. If you have any
questions, I would love to talkto you to get your pointed in the
right direction. The CPI index,you know, came out this week and
last week last month. You knowthat for the month of June, we
were waiting for CPI to come downto about three percent, which it did

(29:27):
well. It ticked up to aboutthree point two percent, but that's lower
than what we were expecting. Weexpected a little tick up, so it
went from three percent to CPI rateto three point two but we were we
were expecting three point three. Soit's still pretty good, folks. That
shows that the economy is slowing down. The hikes, the interest rate hikes

(29:49):
that the FED has put in placeseems to be working. And you know,
because of those hikes, that's whymortgage rates are up. But it's
also why you're getting paid more inyour savings account. If you're buying CDs
or bonds, you're getting paid morebecause the FED has been hiking interest rates
I think eleven times over the lastfifteen months. Then they took a pause.

(30:14):
I'm hoping that when they meet inSeptember that they don't hike interest rates
anymore. I'm hoping that they sitback and watch the job that they did
play out. Because inflation is comingdown. It's a whole lot less than
the nine point one percent, whichis where it was last June. That
was the high water mark nine pointone percent when prices were just crazy.

(30:38):
Prices are still historically higher than normal, but as I said, the trend
is that inflation is coming down.That's why we have our portfolios fully invested
to our target. We're not raisingany cash and all, if anything,
we're putting all the cash that wehave to work. We kind of we're

(31:00):
optimistic. All years, our clientshave been you know, profiting no pun
intended, with some pretty good returnsbecause of our outlook. That's the key
when managing money and investing money onbehalf of clients, which is what we
do or a fiduciary. All wecare about is what's right for our clients.
But it's a big job looking atreally you know what, what and

(31:25):
where you should be investing your money. And I have you know, my
son Ryan is kind of heading upthe investments in Paolola Pietra, our portfolio
strategists and folks. When I tellyou they're doing a great job, they
are doing a great job. Ifyou go to our website Bouchet dot com,

(31:47):
you've got a lot of good informationand there's you know, one of
the best things there is the secondquarter market Update, which Ryan and Polo
really put together, and it's onlythirty minutes long. But if you go
to our website Bouchet dot com,I'm telling you there's some great, great

(32:09):
information. There are our blogs andour webinars which we do months a month.
You know, the second quarter marketupdate, Ryan and Pollo put together
a lot of a lot of goodinformation there, and if you have a
half hour to spare and you wantto just kind of get a feel for

(32:31):
who we are and what we doand how we do it, go there.
But as I said, we've beenoptimistic all year that the stock market
had more upside than downside in it. And it's nice to sit here having
the s and P up about seventeenpercent year to date, the QQQ up

(32:51):
thirty eight percent year to date.Those are two largest holdings in our portfolio.
We're still overweight technology and technology eventhough it gets hit hard, which
it did last year. And youknow, as they said, so far,
QQQ is down about five percent inthe month of August because interest rates

(33:13):
are going up and these growth companiesget valued. Basically they look at future
profits and they bring it back anddiscount them, and with higher interest rates,
they just don't look look as good. So you have a lot of
growth companies, they'll get beat upthe most stern times of volatility and long

(33:34):
term you know, believe me,yeah, you hear me. Give this
statistic out quite often. The SMPover the last fifteen years up eleven percent
year in year out, and QQQup sixteen percent year in year out,
and you put it in perspective,that's why we have QQQ and our portfolios.

(33:57):
We feel very comfortable with it.The bond didn't, which is a
proxy. If you look at theI Shares Core US Accurate Bond Index sense
like the same as the smp BUTTfor bonds over the same fifteen year period,
up two point five percent. That'swhy I'm very comfortable with stocks in
the portfolio, and you should beas well. Over time, even though

(34:22):
you have times of volatility. Youknow, don't don't don't fret, don't
panic, don't have any knee jerkreactions times of volatility. That comes with
the territory of being invested. Andif you have a well diversified portfolio,
you have stocks and bonds in there. Stocks over time will outperform all other

(34:43):
asset classes, whether it be bonds, commodities, real estate, cash stocks
has historically always outperformed these asset classes. But there's more volatility with stocks,
and that's why some investors look atstocks as being risky. But when you
put it in perspective, a littlerisk goes a long way for the rewards

(35:06):
that you profit from. And ifyou are in a well diversified portfolio.
Most most of our clients are ina well diversified portfolio, and they've done
just fine. I had one clientthat was very comfortable this clients in his
eighties, very comfortable with with withrisk and a well diversified portfolio. As

(35:31):
he used to say to me allthe time, Steve, I want to
be invested just like you. AndI said, well, you know,
I'm I'm I'm in our all equityportfolio because I understand risk. He said,
Steve, I've been with you twentyyears. I understand risk too.
You've You've taken a lot of timeto educate me over the years, and

(35:52):
I'm very comfortable with it. It'swhy I had the portfolio that I have.
Well, you know, we settledin on a growth stress to chieve
for him a little eighty twenty uhmix. And unfortunately, you know,
his two sons got involved and lookingto protect mom and dad and you know,

(36:13):
these all they wanted to do wastalk about politics in the state of
flocks that were in and long storyshort, and the parents, you know,
listen, this is their sons.And they sat on the conference call
last last fourth right at the lowpoint of the market and I advised against

(36:35):
this, but the sons wanted momand dad to be more conservative. And
you know, my client said tome, Steve, you know, they're
my sons. I got to listento them, and he knew, he
knew it was a bad move.And we had a little review this week.
And it costs them a lot ofmoney almost you know, over fifty
thousand dollars of gains by listening tothe sons. And you know, the

(37:00):
sons were on the call this weekand as I said to them, listen,
guys, you do your job.Let me do my job. I've
been managing money for a long time. I get paid to do this,
and I've taken pretty good care ofyour parents and that's why they had the
wealth that they have. But youknow, the parents wanted to, you

(37:22):
know, not muddy the waters,let's say, and the sun's made a
real don't be moved on. Behalfof their parents trying to protect them and
folks bloy me. As I saida few moments ago, it's not easy
managing money. We've done a goodjob, a stellar job, managing money

(37:42):
for our clients over the years,and we continue to do a good job
and it's you know, more timesthan that we are going to be right.
But the one thing that we don'tdo is have that knee jerk reaction
or panic when there's times of volatilitylike last year, And nor should you
if you're invested properly. You justhave to let those those violatile times roll

(38:07):
off your shoulders and not get caughtup in it. Don't get caught up
in it. It's just not worthit because it will only come back and
and hurt you. You know.That's that's that's really all all I can
say is you need to put itin perspective and make sure that that that

(38:29):
that you're you're you're you're doing okay. So you know, one one one
other sector. You know, Italked a little bit about the financials,
but one other sector that really hashas been beaten up is reats real estate
investment trust and for for good reasons, you know, with higher interest rates,

(38:53):
reets. You know, sometimes peoplelisten. Mortgages play a big role
in in reets and income investors.When when interest rates were near zero,
which they have been for most ofthe last fifteen years, where investors couldn't
get any yield at all, theyhad to think outside the box and bring

(39:16):
alternative assets into the mix. Reetsare an alternative assets. They're not like
a bond. They have a niceyield, and in a way it's a
hybrid because you're you're buying equity.You're buying into these these reets of whether
it be warehouse reets, apartment complexreets, shopping wall reets, office building

(39:43):
reets. You know, there's reetscome in different different flavors. One of
the one of the best reets outthere is the Vanguard real Estate ETF,
the symbolist v n Q. Andwhat's nice about it is, you know,
right now you're getting almost a fivepercent yield if you look at at

(40:06):
the performance of this reet over thelast fifteen years, about a six percent
average return year in year out.But as I said, reats haven't been
doing too well of late because peopleare getting you know, four or five
six percent by buying government bonds orgood corporate bonds, triple A rated corporate

(40:32):
bonds. So reets are really havinghaving a hard time. And the VNQUE,
the Vanguard REAT, you know,it's got you know, all of
its money in different reets and it'sgot you know, a whole bunch of
reats out there. It's well diversified. You as they said, you're getting

(40:52):
almost a five percent yield right now. And you know, reats may be
at place because they've been beaten upso much. If you look year to
date, you know, the Vanguardis up about one percent, which is
better than the bond index. Thebond index is down about one percent,

(41:14):
some other some other places to go. You have preferred stocks which are down
about four percent year to date.We used to have those in the portfolio.
We got out of those, thankgod. Gold is up, you
know, just about four or fivepercent year to date. If you buy
the gold etf Jeffy, which isa nice holding that we still own the

(41:38):
portfolio Jeffy has about you know,it's the JP Morgan Equity Premium Income and
we still own it for a lotof clients. And you're getting almost an
eight percent yield on that eight percent. You heard me right, And year
to day, you know, we'rewe're we're up pretty good compared to the

(42:00):
bond indecks being down a little bit. So this Jeppy has been really really
good to our clients. But asthey said, reets, if you want
to look at reets income investors.They look for dividends and they look outside
the box for places to go andreal estate investment trust. You know,
we're a pretty good dividend play.And since you know, tax laws require

(42:22):
reats to distribute most of their profitsas dividends for a long time, they
were getting pretty good yielding right now, as they said, four to five
percent and most of the reets andyou know what treasure yields being about the
same. Some people may say,I don't need to take on that risk

(42:43):
of a red but treasure yields maycome down and reets may do well.
The one part of reats that I'mnot happy about that I would not recommend
you get into our office building reats. And you can believe me as they
said, the Vanguard is like indexof reechs because you got a little of

(43:07):
everything in there. You have youknow, you name it. You have
at warehouse, shopping walls, officebuildings, apartment complexes. So you're getting
a little bit of everything. Butyou can drill down in really hone in
on different different reads and you know, the apartment complex reets have really I

(43:30):
think there's a lot of potential there. I'm afraid that when if you were
to buy office reets, office buildingreets. And I've been saying this for
a long time, COVID really dida terrible thing to the workforce because people
got forced to work remotely, andthen they got used to working remotely.

(43:54):
And a lot of people have beenworking remotely for the last few years.
They don't want to go back inthe office. But businesses are realizing I
don't have to pay these high rentsand I can have people work remotely or
maybe in a hybrid flex situation wheremaybe they're working remotely two three days a

(44:15):
week and they're able to kind ofspread out where people sit when they are
in and working remotely. It's nota bad thing, I know. I
offer it to my team and Ifeel like it's a hidden benefit. Every
Friday, my team works remotely theirhome. They don't have to fight traffic,
they get a good start on theirweekend. It's a nice benefit I

(44:37):
think for my team. I thinkthey appreciate it. I hope they appreciate
it. It's something that we don'thave to let them do, but it's
something that we do let them do. And we pick Fridays because I said,
what better day to be home,working from the comfort of your home
than on a Friday and not haveto fight that rush hour traffic leaving the

(44:58):
office. You know, you're,you're, you're, you got a good
start on the day. But theseoffice buildings, especially in big cities,
they're mostly empty. And when theseoffice leases come up, folks, I
don't think there's going to be asmany people, you know, looking to
renew for large office space. AndI, as I said, if you

(45:21):
do feel that you want to lookinto a reat as an alternative to your
bond and stock portfolios and asset class, real estate is a pretty good asset
class over time. Fifteen year averagein bonds two point five percent, fifteen
year average in the reets six almostseven percent, and you get a decent

(45:43):
yield. Just put it in perspective. It may, you know, like
financials, if you want to thinkoutside the box and add something to your
portfolio, that may not be abad place to to add as a You
know, we we we don't ownany reets right now now. We had
them in the portfolios. We tookthem out about a year ago, good

(46:04):
timing, and we may add themback into the portfolios and alternative but as
I said, I'm giddy over thefact that we can really buy some good
bonds with some good yields, AndI haven't been this giddy about buying bonds
in quite some time. Folks,we're coming up to the end of the
show you're listening to. Let's TalkMoney, brought to you by Bouchef and

(46:28):
Andtricate, where we help our clientsprioritize their health while we manage their wealth
for life. It's real important.When you have your health, you have
everything. When you have each other, your loved one, you're pretty fortunate.
And if financially you can make thingshappen, don't waste time. You
never know when your health or yourloved one, you know, the status
of that may change. Thanks fortuning in. Go to our website Bouchet

(46:52):
dot com. Have a great week. See you next Saturday at ten o'clock