December 9, 2025 • 38 mins
Mike Armstrong and Paul Lane discuss Home Depot sharing a cautious outlook for 2026. Alex Gailey (Bankrate) joins the show to chat about many home buyers finding themselves on the outside looking in due to too high prices and/or too much competition. Married couples need to make sure they are planning together. 401(k)s are minting a generation of moderate millionaires. What is the worst Christmas song?
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Episode Transcript
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Speaker 1 (00:00):
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(00:43):
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(01:03):
This is the Financial Exchange with Mike Armstrong and Paul Lane.
Speaker 2 (01:11):
Good morning, Welcome back to the Financial Exchange. It's a
Tuesday here where markets are trying to stage to comeback.
We opened up a negative territory. We've got all three
major industries up, but not by a whole lot. Of
Dow currently leading the way up a quarter of a percent.
We'll have a full recap for you later. We're also
going to be joined by don't have my schedule in
(01:31):
front of me Alex Alex Gaily from Bank Rate in
the next segment, talking to us about the American housing
market and folks getting priced out of it. We had
a jobs released this morning at ten am. The Job
Openings Labor Turnover Survey, brought to you by the US
Bureau of Labor Statistics, found that the number of job
(01:52):
openings sat pretty steady at seven point seven million, a
very slight increase, whereas the number of hires and little
separations did not change a whole lot at five point
one million. Within the separations, the quits rate and layoffs
and discharges were a little changed as well, at two
point nine million and one point nine million, respectively. We
(02:13):
also had a late afternoon announcement on in Nvidia and
their ability to sell chips to China. These are not
the Blackwell, latest and greatest chips. These are the H
two hundreds. Apparently the Trump administration reaching a deal with China.
We debated how significant this is, and I guess the
culmination of that debate would be looking at Invidious stock
(02:35):
price today, which is not moving really at all. Did
get a little bump though yesterday afternoon around this announcement.
It looks like but this was under yeah starting is
that aftermarket trading it got a little bit of a
bump and then came right back down. So the investors
(02:55):
seeming it is up about two percent of the last
five days. But you know yesterday you got a bump
late afternoon right at the close, and then you know,
reopened about where it was during regular trading. So I
think investors taking the message here that there might be
a path for some new semiconductors to be sold to China.
But it is a long winding path with a lot
(03:16):
of potential roadblocks. And we're still not talking about the
most profitable chips that Nvidia has to sell. Home depot
stock falling ahead of their investor day that they have
and this is going to be one of many stories
that I think we'll be covering over the course, frankly,
not just of the next few months, but of the
next few years that speak to the housing market generally,
(03:39):
affordability specifically, and any company that is involved in the
rehab of or new construction of homes, because there's just
not a great solution to what we're dealing with in
the housing market. But let's start off with the with
the conjecture about Home Depots Investor Day and what we're
(04:00):
likely to hear there.
Speaker 3 (04:01):
Yeah, some recent updates from Home Depot that they're offering
cautious guidance for next year, basically stating that they don't
anticipate the housing market to rebound in the short term.
And you have that in dovetailing with some home builders
that we'll talk about a little bit too, that I
also have been getting beaten up pretty significantly from the
stock side of things, just sort of echoing the sentiments
(04:23):
that we've talked about in the program, where it's just been,
like you said, Mike, it's been a very dismal housing
market and none of the potential catalysts that had been
rumored have really come home to roost, whether it be
lower interest rates. There hasn't been a real significant change
there on the thirty year fixed mortgage side of things.
And also you just haven't seen a significant uptick in
(04:46):
transaction volume. And you've seen more listings out there, but
just not the appetite for them. And Home Depot's forecasts
kind of reflecting that sort of change, where they're seeing
that their sales growth is going to be slow and
compared to where it was in twenty four.
Speaker 2 (05:01):
So shares of Home Depot down about ten percent this year.
It's tough for me to imagine what is going to
turn this one around. You need higher volume of home transactions.
We're not seemingly getting it. The one glimmer of hope
that I think I can point to would be that
there is going to be some cash moving into the
overall financial system in twenty twenty six. We've got a
(05:24):
few different things, mainly to do with the Trump tax
cuts that will be coming into play in the March
April timeframe, right in time for the spring housing season.
You have the bigger tax cut for seniors. You have
the reduction of the salt stuff for folks in high
income tax states, and so a few of those things
(05:45):
are likely to result in bigger income tax refunds, some
of the biggest ones we've seen in years. I'm just
not sure how much home Depot ends up benefiting from
that compared to a company like Walmart or TJX or
some of these other companies that are lower ticket items
that might help you feel good without having to spend
ten thousand dollars on a bathroom rehab.
Speaker 3 (06:05):
This is probably a long shot probability, but potentially if
you were to see more rate cuts heading into twenty
twenty six, and I'm talking about a significant amount of them,
then maybe that brings down the barring costs on the
whole equi line of credit side of things and makes
it so that borring against existing equity in the house
is close to that, you know, four to five percent.
Speaker 2 (06:25):
A little bit more tenable.
Speaker 3 (06:26):
Yeah, I suppose that I'm grasping its stars.
Speaker 2 (06:29):
Yeah, yeah, I mean, one thing that would be a
lot of rate cuts. One thing that we don't have
any evidence of is the rate cuts that the Fed's
been doing affecting longer term interest rates and therefore buying mortgages.
The current average for a thirty year fixed rate mortgage,
according to Mortgage News daily sitting at six point three
six percent, and if we take a look here at
(06:50):
over the course of the last year or so, hold
on just a moment. Sorry, now we're gonna start playing
me off.
Speaker 3 (06:59):
We had had prediction going into this year as to
what mortgage range would be. I believe it's me and
Chuck on there was Mike did Mike? Did you hop
in this too? Were you we predicted the range? I
think I had the high of seven and change. Ben's
got it here.
Speaker 2 (07:16):
I don't know, but in either case, at the end
of August was last year, which is right before the
FED started cutting rates. End of August, last day of August,
the average thirty year fixed rate mortgage was six point
four to one percent. Since that point in time, the
FED has cut rates by a total of one and
a quarter percent. Three cuts last year or was it
(07:37):
four cuts last year?
Speaker 3 (07:39):
I think just three?
Speaker 2 (07:40):
No, it's double plus two, right, so full percentage point
last year plus another half percent this year. You've now
gone from six point four to one percent on the
thirty year fixed rate mortgage to six point three six
percent in spite of a big series of rate cuts.
Speaker 3 (07:55):
On the shorter end, which obviously just for listeners out
there doesn't impact the longer end. What were the range
that we had been Paul had.
Speaker 4 (08:01):
A low of five point eight five and high seven
to one, Chuck had five point two to seven point eight,
and Mike's I can't read the writing here had a low.
Speaker 3 (08:10):
Of six point five.
Speaker 2 (08:12):
Well, I'm screwed.
Speaker 3 (08:13):
I think I nailed that. What did the load did
it get?
Speaker 2 (08:16):
I mean you gave a range of one and a
half percentage points Paul, Yeah, you totally nailed it. Congratulations,
this is right. Let's take a quick break when we
come back. Alex Gaily from Bankraage joining us. The article
today priced out of seventy five percent of the market.
American's dream of home ownership has become a luxury. Alex
(08:37):
joins us. Next on the Financial Exchange.
Speaker 1 (08:40):
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(09:00):
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Radio Network.
Speaker 2 (09:16):
Joining us now is Alex Gaily from bank Rate talking
to us about their latest piece on home affordability in
the United States. Alex, thank thanks so much for joining us,
appreciate it.
Speaker 5 (09:26):
Thanks for having me here today.
Speaker 2 (09:28):
So we have folks on from bank Rate on a
fairly regular basis, and oftentimes it's about surveys that are
done of the American consumer asking them about affordability and
prices and spending plans and credit cards. This is a
little bit different. You guys analyzed dozens of metro markets
to try and figure out, you know, for the average family,
(09:49):
how affordable is housing Specifically, what was your methodology here
to determine affordability for these households.
Speaker 5 (09:58):
So we analyze primarily real dot com and Redfinn data
to figure out what share of homes are affordable to
the typical household and the thirty four largest US metros.
And we defined affordability by looking at the thirty percent
rule and that your housing costs typically should stay under
that threshold. At least that's been the historical definition and
(10:20):
widely popular measure for the real estate industry. So what
we really found is that nationally, seventy five percent of
homes are unaffordable to the typical household And then when
you zoom in more locally, only about a dozen of
the largest US metros have more than thirty percent of
listings that are affordable to the typical households in those areas.
(10:42):
So what this tells us is that really it validates
the frustration that many home aspiring homeowners have felt over
the last few years, which is that they want to
become homeowners, but they're increasingly feeling priced out. And it
shows us that homeownership has, in many ways in America's
largest city, become a luxury instead of this common middle
(11:06):
class milestone that historically it has been.
Speaker 2 (11:08):
So you mentioned thirty four large metro areas. I don't
need you to list them all, but where did you
find the worst problems of affordability? And some areas that
are I'm sure they're not what most people would define
as affordable, But where did you find the most affordability
across the country?
Speaker 5 (11:24):
I guess so in terms of the trends we saw regionally,
the coastal markets are largely the least affordable for typical
households in those areas, so we saw rich was no
surprise New York, Boston, Miami on the East coast, and
then on the west coast, La San Diego, Seattle, San Francisco.
(11:44):
These markets are where essentially the typical household is completely
price style of those markets, So you have to be
earning significantly more than that, you know, talking one hundred
and fifty thousand plus in a lot of these metro
areas to even think about getting your foot in the door.
And then when you go more inland, that's where we
see that there is still a path to homeownership. So
(12:07):
places like Saint Louis, Detroit, Pittsburgh, Birmingham, a lot of
metros in the South along the Russ Bell and even
in the Midwest. Although Midwest does offer affordability, it has
been lagging in terms of new construction, so it's a
little bit more bottleneck than the Midwest, but it does
have that affordability, which is what is attractive to a
(12:28):
lot of Americans right now who want to become homeowners.
Speaker 2 (12:30):
It seems to me that this affordability problem is well
obviously causing friction, obviously getting a lot of attention, but
I think also is resulting in you know, voters going
to the ballot voting based on these types of things
we've seen. Well, you know, housing affordability being a big
affordability generally being a big item that was debated during
(12:53):
the New York City mayoral election. Here in Massachusetts, there's
a ballot initiative going forward to propose rent control again
in Massachusetts. What do most economists view as the underlying
root cause and does anybody have what seems to be
a achievable solution to housing affordability today?
Speaker 5 (13:14):
The real fix to achieving more affordability in the housing
market is simply building more homes. But the problem with
that is that it takes time, and we haven't been
building homes at the rates we should have been since
the Great Recession. As of the latest data I've seen,
we're about at a four point seven million housing shortage
across the country, so we have a lot of catching
(13:35):
up to do to meet demand. And really the root
problem is the lack of supply, specifically affordable housing across
the country, but particularly on those coastal markets. But you know,
we spend a lot of time talking about how much
prices have grown for homes over the last five years,
they're up about fifty percent, wages have only been up
(13:57):
about twenty percent during that time period, and then you
also have these higher mortgage rates that are keeping a
lot of buyers on the sideline. So I think overall,
looking ahead, the forecast i've seen have been more optimistic
and that affordability will slowly get better, but we do
have a long road ahead. It's not going to be
a quick fix.
Speaker 2 (14:16):
I know this wasn't something that you guys specifically studied,
but if we're heading for a spring housing market where
buyers don't seem to have the money to be able
to buy homes and sellers seem to be fixated on
a price that was really available to them two or
three years ago, it doesn't seem to spell a good
news housing market a high volume of transaction housing market
(14:37):
come twenty twenty six, at least in my view, any
take on what realtors are saying about the upcoming housing
market in twenty twenty six, I think.
Speaker 5 (14:46):
This year could largely be categorized as stagnant. There has
been a stalemate between you know, there's really been a
standoff between buyers and sellers this year, and I think
we could continue to see some of that going into
twenty twenty six. The thing is that is really keeping
I think what a lot of housing economists deem is
optimistic is that it looks like interest rates are headed
(15:09):
towards dropping more and so that you know, inherently affects
mortgage rates in a couple different ways. And so housing
economists think that even if we just see a subtle
drop in mortgage rates, that that will create more demand
on the buyer side to get into the housing market.
And we also may see slower price growth as well
(15:31):
as well as the We have actually seen more supply
in the last few months, and so if we continue
to see a growth and supply, and of course this
varies from market to market, but generally if we start
to see more supply, then that's kind of why a
lot of housing economists are more optimistic going into twenty
twenty six than pessimistic.
Speaker 2 (15:51):
Alex Gaily is a data reporter and analyst at bank
Rade Joints. They talk about the affordability crisis in the
housing market and Alex, thanks so much for joint us.
Appreciate it. We'll talk to again soon.
Speaker 5 (16:01):
Thanks for having me.
Speaker 4 (16:03):
The Financial Exchange streams every day live on YouTube. Subscribe
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only here on the Financial Exchange Radio Network. And it
is time now for trivia here on the Financial Exchange.
Today's trivia question is on this day in two thousand
and five, Paramount purchased DreamWorks Studio for one point six
(16:25):
billion dollars. DreamWorks was founded in nineteen ninety four by
Katzenberger Geffen and the most powerful director in Hollywood, at
least at that time. So today's question is which famed
film director founded dream Works Studio? Which famed film director
founded dream Works Studio? Be the third person to text
(16:46):
us at six one seven three six two one three
eight five with the correct answer, and you'll win a
Financial Exchange Show t shirt. The third correct response will
be our winner, and make sure you add along the
keyword trivia to your answer t r IVA. That's trivia.
To see the complete contest rules, visit Financial Exchange Show
(17:06):
dot com.
Speaker 2 (17:08):
Just sticking with housing for a little bit here. I
had never heard of them, Maybe you had, Paul? Ever
heard of a New Jersey based homebuilder Hovnanian entreprene Enterprises.
Speaker 3 (17:16):
I thought I knew the group. Lennar and told Brothers
it was not familiar with this one.
Speaker 2 (17:21):
Now there was I In any case, the company posted
a loss of fifty one cents per share in the
fourth quarter. Okay, a company lost money a year prior.
They made twelve dollars eighty cents per share twelve seventy nine.
It's a pretty big shift in profitability over a course
of one year. Their shares fell twenty three percent last week.
It spilled over to other homebuilders as well. Dr Horton
(17:43):
Lenar Pulti Group told Brothers, all slipping pretty substantially in
concern for this this home builder here, And I keep
going back to this. I do not see a path
to fixing the home affordability situation in this country for
(18:03):
a number of years. It just is not because of
what she was talking about, what Alex was talking about here.
Even if you get a bunch of constituents all on
board with the idea of developing more housing, which we've
seen here in Massachusetts, they are not. They are not
on board but saying yeah, you can go ahead and
(18:24):
develop dense housing in this area because we want more
affordable homes. And I understand why. But even if they did,
it would take two or three years to get some
of that stuff online and really start to see prices reflected.
And in the meantime, I think the real danger that
people are not picking up on here is maybe you know,
(18:45):
some people would say I'm miscategorizing, but I think the
danger here is the longer home affordability becomes unattainable, I
think the more outlandish solutions to fix the problem are
going to come to the forefront. I'm talking about things
like rent control, talking about things like taxing the rich
to build housing. I'm talking about all of these different things,
(19:05):
fifty year mortgages, it spans the spans the gap. But
everyone is going to be focusing on this. And I
think the affordability situation specifically around housing is why we're
seeing things like Zoron Mumdani being elected in New York City.
Why you know about initiative mess just for rent control
is making it to the forefront again. Quick break, We've
(19:26):
got to We'll be right back, But Wall Street Watches next, bringing.
Speaker 1 (19:40):
The latest financial news straight to your radio. Every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
Time Now for Wall Street Watch a complete look at
what's moving markets. So far today right here on the
Financial Exchange Radio network.
Speaker 4 (20:01):
Not a lot change going on as investors wait tomorrow's
FED decision. However, things have turned positive here. The Dow
Jones is up one hundred and fifty points, or three
tenths of a percent. S and P five hundreds up
over sixteen points, or over two tenths of a percent.
The Nasdaq is up just under two tenths of a
percent right now. President Donald Trump said the US will
(20:23):
allow VIDIA to ship its H two hundred AI chips
to China and elsewhere. The US will get a twenty
five percent cut for the sales, which are only allowed
for approved customers. Vidia is currently up over three tenths
of excuse me, down over three tenths of a percent.
CVS is up over three percent after the company provided
twenty twenty six profit guidance that came above Wall Street
(20:46):
estimates and this year's projected earnings, marking a sign of
steady progress in its turnaround plan. Home Depot shares are
up just under two tenths of a percent after the
home improvement giant issued weaker than expected earnings growth guidance
for twenty twenty s And AutoZone shares are down over
six and a half percent after the automated parts retailer
(21:07):
reported worse than expected results for its first fiscal quarter.
AutoZone posted earnings of thirty one dollars and four cents
per share on revenue of four point six three billion.
Analyst polled expected a profit of thirty two dollars and
fifty one cents per share on revenue of four point
six four billion dollars. And finally, drone maker aero Vironment
(21:27):
is up two and a half percent after it was
awarded an eight hundred and seventy four million dollar contract
for the Army for unmanned aerial systems and counter UAS systems.
I am Ben Kitchen and that was Wall Street watching.
To pay off the trivia question from earlier, a question
was which famed film director founded Dreamwork Studio. Your answer
(21:50):
Steven Spielberg. He founded Dreamwork Studio in nineteen ninety four.
Today's winner is Ben in South Yarmouth. He will be
taking home a Financial Exchange Show T shirt trivia every
day here on the Financial Exchange See complete contest rules
at Financial Exchange Show dot com.
Speaker 3 (22:05):
And do you live in South Yarmouth?
Speaker 2 (22:07):
No, going a little bit off script here for a moment.
I was meeting with somebody the other day and married couple,
few year age difference, not significant, I think it's a
three year age difference, and husband hit sixty five, had
some health stuff going on, retired and wife was still working.
(22:28):
And then frankly got sick of her husband being retired
and she not being able to and she retired too,
and so not quite sixty five, and it led to
some unique challenges. Largely the biggest one where the heck,
am I going to get my health insurance? Because it
gets pretty expensive. Fortunately for them, for the last few
years it hasn't been a big issue because of the
(22:52):
Affordable Care Act and the additional subsidies that have been
going on since COVID. But now they're heading towards twenty
twenty six and they're looking at a pretty big increase
in premiums for a period of time here, and so
we're talking about positioning assets and things like that. But
when I think about most of the conversations I have
(23:12):
with married couples, it when it comes to financial playing,
it's all coming down to one thing, which is, given
that we're a married couple, there's a good chance we're
going to live a pretty long time, and how do
we protect each other, whether it's through insurance, whether it's
through investment planning, and how much more complexity is added
to the overall situation, and you know, it really runs
(23:35):
the game. But I'm also working with a couple in
their thirties and we were trying to plan out, like
what's the right amount of life insurance to have. You know,
they have one kid, but they're like, we're planning on
having more and we're healthy now, So what do we
do about these types of things. I'm trying to think
of the additional complexities. There are a few items that
I don't consider to be red flags, Like that's not
(23:56):
what I'm describing. But there's a few categories you can
fall into where you say, okay, it's really time to
engage a professional. One of them is that situation where
if you're trying to retire before sixty five, before you
get anywhere close to sixty five, there's a lot of
planning to be done, whether it comes from you know,
when you're gonna take Social Security, how you're going to
(24:18):
get health insurance, Like if your goal is to retire
before sixty five, start planning at fifty five, right, Start
playing at forty five if you can, But at the
very ly start playing at fifty five because there's going
to be a lot to do. The other one that
again not a red flag, but requires more planning. If
you're an unmarried couple, it's immensely more complicated. Sure, sure, right,
(24:40):
Like how many clients do you work with where it's
second marriage, kids from both sides. They're talking about getting married.
They're worried about the consequences. You know, what if my
new spouse goes into a nursing home. What if what
if I die and we're not married? In my retirement
account has to be turned into an inherited or something
(25:01):
along those lines, income.
Speaker 3 (25:02):
Loss from pension, social Security, those types of things are
definitely at the forefront and the planning piece. I couldn't
agree with you more. Oftentimes we're meeting with people who
are on the prespice of retirement, and if they fall
short on their planning, then they almost are turning to
us to saying, all right, I'm ready to go. But
(25:24):
if we had met three or four years prior, we
could have put in a plan to place, particularly on
the savings front, to be very aggressive because usually in
those later years of your career, you're making the most
money that you have, and that is likely the best
time that you have to save more. The kids are
likely out of the house or off the payroll and
cause tuitions, So that sixty to sixty five range you
mentioned can be a real significant time to increase your savings.
(25:47):
So better to do that knowing at fifty five or
sixty I'm about to turn it up and save a
lot during this period of time than just come in
at sixty five and say, hey, I'm ready to go.
Speaker 2 (25:56):
We have a brand new guide from the Armstrong Advisor
Group for the month of December. It's called Retirement Planning
for Spouses, and there's no way to capture everything that
goes into this for a married couple, but this guy
attempts to identify which areas you should be focusing on
if you're heading forwards retirement as a married couple, and
how to assess things like when's the appropriate thing to
(26:18):
take SOCCE security, how much insurance do I need to have?
What types of insurance do I need to have as
I'm heading to that later stage. If you would like
your free copy, you can call eight hundred three nine
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(26:38):
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Speaker 1 (26:43):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial tax into state planning advisors before making
any investment decisions. Armstrong may contact you to offer investment
advisory services.
Speaker 2 (27:00):
Four one k's are minting a generation of moderate millionaires.
That's what UBS is calling them. Any well, ubf ubs
UBF UBF has dubbed them the moderate millionaires, with assets
ranging from a million to five million dollars. And their
point about this term moderate millionaires, which I'm not sure
I like, but the term millionaire generally to me at least,
(27:24):
does bring images of Scrooge McDuck with his top hat
and diving into his piles of gold. And their point
is that given how the retirement systems have shifted in
the US, given how investments have performed over the last
few years, that you have this new group of people
who are generally pretty close to retirement but generally think
of themselves as firmly middle class, and are suddenly sitting
(27:49):
on more than a million dollars of retirement savings but
not really spending that money like previous generations of millionaires did.
Speaker 3 (27:57):
Well, it's the inflation piece, you know, that's a huge
part of it. That a million dollars today isn't what
it was ten twenty years ago. And I had a
couple a social gathering or two, I've had somebody ask
me off cuff, you know, hey, how much would someone
around this area need to retire? And this kind of
spins back to some of the stuff we do on
(28:18):
a day to day basis. But the answer, it's so hard, Mike,
to give that answer to somebody because someone who's pushing,
you know, g wagons and properties everywhere, the number is
a lot different than somebody who's you know, cruising a
little bit more affordability. But I would agree, in Massachusetts
or some of these Northeast states, a million dollars it
(28:39):
doesn't get you as far as it used to, for sure.
Speaker 2 (28:42):
By the way, that inflation piece is important because Scrooge
McDuck first made his appearance in December of nineteen forty seven,
so it's not exactly a new reference. I did not
think Scrooge McDuck went back that far. But I do.
Speaker 4 (28:55):
Remember this everyone because that is going to be our
trivia question.
Speaker 2 (28:58):
Huge and McDuck nineteen forty seven according to AI, So yeah,
having a million bucks in your four oh one k,
you're right, is not quite quite what it used to be.
But nonetheless there's you know, whether it's Fidelity or Vanguard,
they're all reporting more and more of their four oh
one k participants are at that threshold or higher.
Speaker 3 (29:19):
Now the market's gone up.
Speaker 2 (29:20):
Quick break when we come back. Stack Roulette is next.
Speaker 1 (29:26):
Here The Financial Exchange every day from eleven to noon
non Serious XM's Business Radio Channel one thirty two. Keep
it here for the latest business and financial news and
the trends on Wall Street. The Financial Exchange is now
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(29:48):
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Get cut up on anything and everything you might have missed.
This is the Financial Exchange Radio Network.
Speaker 4 (29:59):
This levee of the financial exchange is brought to you
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(30:21):
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Speaker 2 (30:53):
Boston Road Today. Deciding that this is the worst Christmas
song for US, I have to say it's probably up there.
It is a pretty terrible song. Paul McCartney, I don't
know why you went about this, but I'm not sure
it's the worst. I do like the description of this song. First,
they describe Grandma got run over by a reindeer as
(31:15):
the audio equivalent of drinking kurdled eggnog that's been leasd
with moonshine distilled in Jeff fox Worthy's bathtub. I don't
know which AI wrote that, but that, yeah, that's a
pretty good insult. I do like that. Uh, personally, Wham's
Last Christmas way worse than either of those two songs. Yes,
(31:36):
I'm just gonna throw that out there as worse than
all of them. Do you guys have any contenders? By
the way, you can text the show if you have
a contender for worst ever Christmas song six one, seven
three six two thirteen eighty five. I feel like this
time of year, we do all hear them in the
stores and just like something turns in my head a
little bit when I hear one of them that really
gets me upset. And uh, but yeah, I'm hearing it
(31:59):
constantly across all the stores, and those are two of
them that just I can't stand. In fact, we were
listening to Grandma got run over by a reindeer, and
my nine year old, who never listens to lyrics, like
listen to the lyrics and she's like, oh, oh god,
did they say that she? I think she like drank
something or too much or something, and then you know
(32:20):
Grandpa founder dead and that's you know why they believe
in Santa Claus. Now, I that is a pretty rough
one for a nine year old. That's a miracle. Anybody
else have any contenders for worse Christmas?
Speaker 3 (32:33):
I would have gone simply having a wonderful Christmas Time
Every year. I have the sam recurring thought in my
head when these songs kew up again, I'm like, this
is the best musical business model decision ever to have
if you can successfully make it into the rotation of
them like and Sync did one and my wife still
plays it to this day, the n Sync like Christmas
songs that they've done, and other artists have done this too.
(32:55):
Michael Buble has done a Christmas album, but like, if
you can get to be one of those big players,
none other than Murah Carrey is the absolute queen of
this and has made it a annual spiel of hers
to just try and take over the Christmas time airways.
She does have probably the best one out there.
Speaker 2 (33:11):
Yeah I've got it, saying Michael Bubla. There's a famous
image of give of him walking out of a cave
and you know, did someone say Christmas and he was
interviewed and somebody asked him about this, and he was like, guys,
we gotta stop. I have thirty friends that send that
same exact picture to me every single year the day
after Thanksgiving. So yeah, yeah, pretty good gig if you can,
(33:34):
you know, get one of the.
Speaker 4 (33:36):
We're missing an obvious one here. I think, hands down
the absolute worst of all of them. Christmas wrapping by
the waitresses.
Speaker 2 (33:44):
Oh, actually I put it into my rotation.
Speaker 3 (33:47):
Oh you like it?
Speaker 2 (33:48):
I like it? Yeah, Yeah, I'm gonna talk to you
from now on. Well, yeah, i'd say, how does it go?
Speaker 3 (33:55):
But I don't really want to hear either of you
guys sing.
Speaker 2 (33:57):
Yeah you don't anything by Alvin and the Chipmunk's terrible.
I start to cringe when I hear that, So I
really that one just distresses me a little bit. Yeah. Again,
if you have a least favorite Christmas song textas at
six one seven or I guess favorite will highlight the favorites.
(34:17):
But six one seven, three, six, two, thirteen eighty five,
what do you have for us? Or stack with that?
Speaker 3 (34:21):
Pol from Lamas to Avocado's Meta's shifting AI strategy is
causing internal confusion. I couldn't resist doing one more artificial intelligence.
Speaker 2 (34:32):
Story, especially to pick on Meta at the same.
Speaker 3 (34:34):
Well, that's kind of where I wanted to go with
this is when you look at the players in the
artificial intelligence game, which is fascinating me just because there
is so much a stake from a monetary and you know,
stock market perspective. Meta is often like that person in
high school that is maybe knocking out knocking the door
(34:55):
of all the cool parties, but not really being let in,
uh with open arms. Because it is trying to be clear.
MENA has benefited significantly or Facebook from artificial intelligence the
reels or the advertisements that you're served up on your Instagram,
and Facebook is a benefactor from just machine learning and
(35:16):
our official intelligence to putting the right ad in front
of you, and that's led to a lot of profitability
for them. However, when it comes to the large language
model stuff, they are barely mentioned. When it comes to
talking the big players at all. Tessa or Eon muss
Xai is one, or Groc that's one that's up there,
Anthropic and many others out there, but they are just
(35:37):
like a drunken sailor in terms of their spending and
just going after this problem. It's just like, I'm just
gonna throw all this money at this and maybe we'll
become a player in this. Avocados is supposed to be
their new large language model that's coming out. Lamas was
the previous one they're naming conventions for these are also
mind boggling. I guess you do remember them by how
(35:58):
obscure they are. But they have thrown own billions of
dollars at the problem, and I wonder that this fear
of missing out for them could cause further issues for
the company in just terms of what they're spending. They
still have such a profile business model. Instagram is still
an absolute giant out there. WhatsApp is a great business too.
But it's just funny to see them spin their.
Speaker 2 (36:20):
Wheels on the naming conventions. I'll just acknowledge that they're
not alone in this one. Google's new image generator is
called Nano Banana, So like, at least they're in good
company with naming their ais stupidly, which I feel like
is their way of not making them quite as scary. Sure,
(36:40):
you know, like if you're going to get attacked by
a future AI and it's called chat GPT five point three,
that's kind of scary where if it's nano banana, how
much like how that's what I would do too if
I was if I was inventing a world ending technology,
I would definitely name it something like avocado. But yeah,
(37:01):
the question is can Meta throw good money after a
good project. After sinking tens of billions if not more,
into their metaverse, which still open, produced nothing, And finally
they've taken a step back and said, yeah, we're going
to divert some of the money from that continued investment
(37:22):
into artificial intelligence. But yeah, that's I don't quite see
what the path is for Meta, because I don't think
anyone really likes using their products. They do because their
friends are on there, But I don't know what's going
to make me use a large language model from Facebook
versus Google's or anybody else's. But maybe they've got something
(37:44):
else going on if they if they can sell more
ads at a higher profit because of AI than anything
that I'm saying is pretty irrelevant. And clearly they are
not having any issues with getting lots of posts of
AI generated videos on their platform, because that's all that
I see.
Speaker 3 (38:00):
The Facebook post ones are crazy.
Speaker 2 (38:02):
Yeah, markets are open and remain in positive territory with
the Dow leading the way up three ten percent. Will
have a FED meeting tomorrow and a full market recap
and more. Then, have a great rest of your day, folks,
The Financial Exchange is produced by Money Matters Radio and
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(01:03):
This is the Financial Exchange with Mike Armstrong and Paul Lane.
Speaker 2 (01:11):
Good morning, Welcome back to the Financial Exchange. It's a
Tuesday here where markets are trying to stage to comeback.
We opened up a negative territory. We've got all three
major industries up, but not by a whole lot. Of
Dow currently leading the way up a quarter of a percent.
We'll have a full recap for you later. We're also
going to be joined by don't have my schedule in
(01:31):
front of me Alex Alex Gaily from Bank Rate in
the next segment, talking to us about the American housing
market and folks getting priced out of it. We had
a jobs released this morning at ten am. The Job
Openings Labor Turnover Survey, brought to you by the US
Bureau of Labor Statistics, found that the number of job
(01:52):
openings sat pretty steady at seven point seven million, a
very slight increase, whereas the number of hires and little
separations did not change a whole lot at five point
one million. Within the separations, the quits rate and layoffs
and discharges were a little changed as well, at two
point nine million and one point nine million, respectively. We
(02:13):
also had a late afternoon announcement on in Nvidia and
their ability to sell chips to China. These are not
the Blackwell, latest and greatest chips. These are the H
two hundreds. Apparently the Trump administration reaching a deal with China.
We debated how significant this is, and I guess the
culmination of that debate would be looking at Invidious stock
(02:35):
price today, which is not moving really at all. Did
get a little bump though yesterday afternoon around this announcement.
It looks like but this was under yeah starting is
that aftermarket trading it got a little bit of a
bump and then came right back down. So the investors
(02:55):
seeming it is up about two percent of the last
five days. But you know yesterday you got a bump
late afternoon right at the close, and then you know,
reopened about where it was during regular trading. So I
think investors taking the message here that there might be
a path for some new semiconductors to be sold to China.
But it is a long winding path with a lot
(03:16):
of potential roadblocks. And we're still not talking about the
most profitable chips that Nvidia has to sell. Home depot
stock falling ahead of their investor day that they have
and this is going to be one of many stories
that I think we'll be covering over the course, frankly,
not just of the next few months, but of the
next few years that speak to the housing market generally,
(03:39):
affordability specifically, and any company that is involved in the
rehab of or new construction of homes, because there's just
not a great solution to what we're dealing with in
the housing market. But let's start off with the with
the conjecture about Home Depots Investor Day and what we're
(04:00):
likely to hear there.
Speaker 3 (04:01):
Yeah, some recent updates from Home Depot that they're offering
cautious guidance for next year, basically stating that they don't
anticipate the housing market to rebound in the short term.
And you have that in dovetailing with some home builders
that we'll talk about a little bit too, that I
also have been getting beaten up pretty significantly from the
stock side of things, just sort of echoing the sentiments
(04:23):
that we've talked about in the program, where it's just been,
like you said, Mike, it's been a very dismal housing
market and none of the potential catalysts that had been
rumored have really come home to roost, whether it be
lower interest rates. There hasn't been a real significant change
there on the thirty year fixed mortgage side of things.
And also you just haven't seen a significant uptick in
(04:46):
transaction volume. And you've seen more listings out there, but
just not the appetite for them. And Home Depot's forecasts
kind of reflecting that sort of change, where they're seeing
that their sales growth is going to be slow and
compared to where it was in twenty four.
Speaker 2 (05:01):
So shares of Home Depot down about ten percent this year.
It's tough for me to imagine what is going to
turn this one around. You need higher volume of home transactions.
We're not seemingly getting it. The one glimmer of hope
that I think I can point to would be that
there is going to be some cash moving into the
overall financial system in twenty twenty six. We've got a
(05:24):
few different things, mainly to do with the Trump tax
cuts that will be coming into play in the March
April timeframe, right in time for the spring housing season.
You have the bigger tax cut for seniors. You have
the reduction of the salt stuff for folks in high
income tax states, and so a few of those things
(05:45):
are likely to result in bigger income tax refunds, some
of the biggest ones we've seen in years. I'm just
not sure how much home Depot ends up benefiting from
that compared to a company like Walmart or TJX or
some of these other companies that are lower ticket items
that might help you feel good without having to spend
ten thousand dollars on a bathroom rehab.
Speaker 3 (06:05):
This is probably a long shot probability, but potentially if
you were to see more rate cuts heading into twenty
twenty six, and I'm talking about a significant amount of them,
then maybe that brings down the barring costs on the
whole equi line of credit side of things and makes
it so that borring against existing equity in the house
is close to that, you know, four to five percent.
Speaker 2 (06:25):
A little bit more tenable.
Speaker 3 (06:26):
Yeah, I suppose that I'm grasping its stars.
Speaker 2 (06:29):
Yeah, yeah, I mean, one thing that would be a
lot of rate cuts. One thing that we don't have
any evidence of is the rate cuts that the Fed's
been doing affecting longer term interest rates and therefore buying mortgages.
The current average for a thirty year fixed rate mortgage,
according to Mortgage News daily sitting at six point three
six percent, and if we take a look here at
(06:50):
over the course of the last year or so, hold
on just a moment. Sorry, now we're gonna start playing
me off.
Speaker 3 (06:59):
We had had prediction going into this year as to
what mortgage range would be. I believe it's me and
Chuck on there was Mike did Mike? Did you hop
in this too? Were you we predicted the range? I
think I had the high of seven and change. Ben's
got it here.
Speaker 2 (07:16):
I don't know, but in either case, at the end
of August was last year, which is right before the
FED started cutting rates. End of August, last day of August,
the average thirty year fixed rate mortgage was six point
four to one percent. Since that point in time, the
FED has cut rates by a total of one and
a quarter percent. Three cuts last year or was it
(07:37):
four cuts last year?
Speaker 3 (07:39):
I think just three?
Speaker 2 (07:40):
No, it's double plus two, right, so full percentage point
last year plus another half percent this year. You've now
gone from six point four to one percent on the
thirty year fixed rate mortgage to six point three six
percent in spite of a big series of rate cuts.
Speaker 3 (07:55):
On the shorter end, which obviously just for listeners out
there doesn't impact the longer end. What were the range
that we had been Paul had.
Speaker 4 (08:01):
A low of five point eight five and high seven
to one, Chuck had five point two to seven point eight,
and Mike's I can't read the writing here had a low.
Speaker 3 (08:10):
Of six point five.
Speaker 2 (08:12):
Well, I'm screwed.
Speaker 3 (08:13):
I think I nailed that. What did the load did
it get?
Speaker 2 (08:16):
I mean you gave a range of one and a
half percentage points Paul, Yeah, you totally nailed it. Congratulations,
this is right. Let's take a quick break when we
come back. Alex Gaily from Bankraage joining us. The article
today priced out of seventy five percent of the market.
American's dream of home ownership has become a luxury. Alex
(08:37):
joins us. Next on the Financial Exchange.
Speaker 1 (08:40):
This is your home for the most comprehensive coverage of
the economy and the trends on Wall Street. This is
the Financial Exchange Radio Network. The Financial Exchange is now
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(09:00):
every day. The Financial Exchange is live on Serious XM's
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Radio Network.
Speaker 2 (09:16):
Joining us now is Alex Gaily from bank Rate talking
to us about their latest piece on home affordability in
the United States. Alex, thank thanks so much for joining us,
appreciate it.
Speaker 5 (09:26):
Thanks for having me here today.
Speaker 2 (09:28):
So we have folks on from bank Rate on a
fairly regular basis, and oftentimes it's about surveys that are
done of the American consumer asking them about affordability and
prices and spending plans and credit cards. This is a
little bit different. You guys analyzed dozens of metro markets
to try and figure out, you know, for the average family,
(09:49):
how affordable is housing Specifically, what was your methodology here
to determine affordability for these households.
Speaker 5 (09:58):
So we analyze primarily real dot com and Redfinn data
to figure out what share of homes are affordable to
the typical household and the thirty four largest US metros.
And we defined affordability by looking at the thirty percent
rule and that your housing costs typically should stay under
that threshold. At least that's been the historical definition and
(10:20):
widely popular measure for the real estate industry. So what
we really found is that nationally, seventy five percent of
homes are unaffordable to the typical household And then when
you zoom in more locally, only about a dozen of
the largest US metros have more than thirty percent of
listings that are affordable to the typical households in those areas.
(10:42):
So what this tells us is that really it validates
the frustration that many home aspiring homeowners have felt over
the last few years, which is that they want to
become homeowners, but they're increasingly feeling priced out. And it
shows us that homeownership has, in many ways in America's
largest city, become a luxury instead of this common middle
(11:06):
class milestone that historically it has been.
Speaker 2 (11:08):
So you mentioned thirty four large metro areas. I don't
need you to list them all, but where did you
find the worst problems of affordability? And some areas that
are I'm sure they're not what most people would define
as affordable, But where did you find the most affordability
across the country?
Speaker 5 (11:24):
I guess so in terms of the trends we saw regionally,
the coastal markets are largely the least affordable for typical
households in those areas, so we saw rich was no
surprise New York, Boston, Miami on the East coast, and
then on the west coast, La San Diego, Seattle, San Francisco.
(11:44):
These markets are where essentially the typical household is completely
price style of those markets, So you have to be
earning significantly more than that, you know, talking one hundred
and fifty thousand plus in a lot of these metro
areas to even think about getting your foot in the door.
And then when you go more inland, that's where we
see that there is still a path to homeownership. So
(12:07):
places like Saint Louis, Detroit, Pittsburgh, Birmingham, a lot of
metros in the South along the Russ Bell and even
in the Midwest. Although Midwest does offer affordability, it has
been lagging in terms of new construction, so it's a
little bit more bottleneck than the Midwest, but it does
have that affordability, which is what is attractive to a
(12:28):
lot of Americans right now who want to become homeowners.
Speaker 2 (12:30):
It seems to me that this affordability problem is well
obviously causing friction, obviously getting a lot of attention, but
I think also is resulting in you know, voters going
to the ballot voting based on these types of things
we've seen. Well, you know, housing affordability being a big
affordability generally being a big item that was debated during
(12:53):
the New York City mayoral election. Here in Massachusetts, there's
a ballot initiative going forward to propose rent control again
in Massachusetts. What do most economists view as the underlying
root cause and does anybody have what seems to be
a achievable solution to housing affordability today?
Speaker 5 (13:14):
The real fix to achieving more affordability in the housing
market is simply building more homes. But the problem with
that is that it takes time, and we haven't been
building homes at the rates we should have been since
the Great Recession. As of the latest data I've seen,
we're about at a four point seven million housing shortage
across the country, so we have a lot of catching
(13:35):
up to do to meet demand. And really the root
problem is the lack of supply, specifically affordable housing across
the country, but particularly on those coastal markets. But you know,
we spend a lot of time talking about how much
prices have grown for homes over the last five years,
they're up about fifty percent, wages have only been up
(13:57):
about twenty percent during that time period, and then you
also have these higher mortgage rates that are keeping a
lot of buyers on the sideline. So I think overall,
looking ahead, the forecast i've seen have been more optimistic
and that affordability will slowly get better, but we do
have a long road ahead. It's not going to be
a quick fix.
Speaker 2 (14:16):
I know this wasn't something that you guys specifically studied,
but if we're heading for a spring housing market where
buyers don't seem to have the money to be able
to buy homes and sellers seem to be fixated on
a price that was really available to them two or
three years ago, it doesn't seem to spell a good
news housing market a high volume of transaction housing market
(14:37):
come twenty twenty six, at least in my view, any
take on what realtors are saying about the upcoming housing
market in twenty twenty six, I think.
Speaker 5 (14:46):
This year could largely be categorized as stagnant. There has
been a stalemate between you know, there's really been a
standoff between buyers and sellers this year, and I think
we could continue to see some of that going into
twenty twenty six. The thing is that is really keeping
I think what a lot of housing economists deem is
optimistic is that it looks like interest rates are headed
(15:09):
towards dropping more and so that you know, inherently affects
mortgage rates in a couple different ways. And so housing
economists think that even if we just see a subtle
drop in mortgage rates, that that will create more demand
on the buyer side to get into the housing market.
And we also may see slower price growth as well
(15:31):
as well as the We have actually seen more supply
in the last few months, and so if we continue
to see a growth and supply, and of course this
varies from market to market, but generally if we start
to see more supply, then that's kind of why a
lot of housing economists are more optimistic going into twenty
twenty six than pessimistic.
Speaker 2 (15:51):
Alex Gaily is a data reporter and analyst at bank
Rade Joints. They talk about the affordability crisis in the
housing market and Alex, thanks so much for joint us.
Appreciate it. We'll talk to again soon.
Speaker 5 (16:01):
Thanks for having me.
Speaker 4 (16:03):
The Financial Exchange streams every day live on YouTube. Subscribe
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(16:25):
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(16:46):
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(17:06):
dot com.
Speaker 2 (17:08):
Just sticking with housing for a little bit here. I
had never heard of them, Maybe you had, Paul? Ever
heard of a New Jersey based homebuilder Hovnanian entreprene Enterprises.
Speaker 3 (17:16):
I thought I knew the group. Lennar and told Brothers
it was not familiar with this one.
Speaker 2 (17:21):
Now there was I In any case, the company posted
a loss of fifty one cents per share in the
fourth quarter. Okay, a company lost money a year prior.
They made twelve dollars eighty cents per share twelve seventy nine.
It's a pretty big shift in profitability over a course
of one year. Their shares fell twenty three percent last week.
It spilled over to other homebuilders as well. Dr Horton
(17:43):
Lenar Pulti Group told Brothers, all slipping pretty substantially in
concern for this this home builder here, And I keep
going back to this. I do not see a path
to fixing the home affordability situation in this country for
(18:03):
a number of years. It just is not because of
what she was talking about, what Alex was talking about here.
Even if you get a bunch of constituents all on
board with the idea of developing more housing, which we've
seen here in Massachusetts, they are not. They are not
on board but saying yeah, you can go ahead and
(18:24):
develop dense housing in this area because we want more
affordable homes. And I understand why. But even if they did,
it would take two or three years to get some
of that stuff online and really start to see prices reflected.
And in the meantime, I think the real danger that
people are not picking up on here is maybe you know,
(18:45):
some people would say I'm miscategorizing, but I think the
danger here is the longer home affordability becomes unattainable, I
think the more outlandish solutions to fix the problem are
going to come to the forefront. I'm talking about things
like rent control, talking about things like taxing the rich
to build housing. I'm talking about all of these different things,
(19:05):
fifty year mortgages, it spans the spans the gap. But
everyone is going to be focusing on this. And I
think the affordability situation specifically around housing is why we're
seeing things like Zoron Mumdani being elected in New York City.
Why you know about initiative mess just for rent control
is making it to the forefront again. Quick break, We've
(19:26):
got to We'll be right back, But Wall Street Watches next, bringing.
Speaker 1 (19:40):
The latest financial news straight to your radio. Every day.
It's the Financial Exchange on the Financial Exchange Radio Network.
Time Now for Wall Street Watch a complete look at
what's moving markets. So far today right here on the
Financial Exchange Radio network.
Speaker 4 (20:01):
Not a lot change going on as investors wait tomorrow's
FED decision. However, things have turned positive here. The Dow
Jones is up one hundred and fifty points, or three
tenths of a percent. S and P five hundreds up
over sixteen points, or over two tenths of a percent.
The Nasdaq is up just under two tenths of a
percent right now. President Donald Trump said the US will
(20:23):
allow VIDIA to ship its H two hundred AI chips
to China and elsewhere. The US will get a twenty
five percent cut for the sales, which are only allowed
for approved customers. Vidia is currently up over three tenths
of excuse me, down over three tenths of a percent.
CVS is up over three percent after the company provided
twenty twenty six profit guidance that came above Wall Street
(20:46):
estimates and this year's projected earnings, marking a sign of
steady progress in its turnaround plan. Home Depot shares are
up just under two tenths of a percent after the
home improvement giant issued weaker than expected earnings growth guidance
for twenty twenty s And AutoZone shares are down over
six and a half percent after the automated parts retailer
(21:07):
reported worse than expected results for its first fiscal quarter.
AutoZone posted earnings of thirty one dollars and four cents
per share on revenue of four point six three billion.
Analyst polled expected a profit of thirty two dollars and
fifty one cents per share on revenue of four point
six four billion dollars. And finally, drone maker aero Vironment
(21:27):
is up two and a half percent after it was
awarded an eight hundred and seventy four million dollar contract
for the Army for unmanned aerial systems and counter UAS systems.
I am Ben Kitchen and that was Wall Street watching.
To pay off the trivia question from earlier, a question
was which famed film director founded Dreamwork Studio. Your answer
(21:50):
Steven Spielberg. He founded Dreamwork Studio in nineteen ninety four.
Today's winner is Ben in South Yarmouth. He will be
taking home a Financial Exchange Show T shirt trivia every
day here on the Financial Exchange See complete contest rules
at Financial Exchange Show dot com.
Speaker 3 (22:05):
And do you live in South Yarmouth?
Speaker 2 (22:07):
No, going a little bit off script here for a moment.
I was meeting with somebody the other day and married couple,
few year age difference, not significant, I think it's a
three year age difference, and husband hit sixty five, had
some health stuff going on, retired and wife was still working.
(22:28):
And then frankly got sick of her husband being retired
and she not being able to and she retired too,
and so not quite sixty five, and it led to
some unique challenges. Largely the biggest one where the heck,
am I going to get my health insurance? Because it
gets pretty expensive. Fortunately for them, for the last few
years it hasn't been a big issue because of the
(22:52):
Affordable Care Act and the additional subsidies that have been
going on since COVID. But now they're heading towards twenty
twenty six and they're looking at a pretty big increase
in premiums for a period of time here, and so
we're talking about positioning assets and things like that. But
when I think about most of the conversations I have
(23:12):
with married couples, it when it comes to financial playing,
it's all coming down to one thing, which is, given
that we're a married couple, there's a good chance we're
going to live a pretty long time, and how do
we protect each other, whether it's through insurance, whether it's
through investment planning, and how much more complexity is added
to the overall situation, and you know, it really runs
(23:35):
the game. But I'm also working with a couple in
their thirties and we were trying to plan out, like
what's the right amount of life insurance to have. You know,
they have one kid, but they're like, we're planning on
having more and we're healthy now, So what do we
do about these types of things. I'm trying to think
of the additional complexities. There are a few items that
I don't consider to be red flags, Like that's not
(23:56):
what I'm describing. But there's a few categories you can
fall into where you say, okay, it's really time to
engage a professional. One of them is that situation where
if you're trying to retire before sixty five, before you
get anywhere close to sixty five, there's a lot of
planning to be done, whether it comes from you know,
when you're gonna take Social Security, how you're going to
(24:18):
get health insurance, Like if your goal is to retire
before sixty five, start planning at fifty five, right, Start
playing at forty five if you can, But at the
very ly start playing at fifty five because there's going
to be a lot to do. The other one that
again not a red flag, but requires more planning. If
you're an unmarried couple, it's immensely more complicated. Sure, sure, right,
(24:40):
Like how many clients do you work with where it's
second marriage, kids from both sides. They're talking about getting married.
They're worried about the consequences. You know, what if my
new spouse goes into a nursing home. What if what
if I die and we're not married? In my retirement
account has to be turned into an inherited or something
(25:01):
along those lines, income.
Speaker 3 (25:02):
Loss from pension, social Security, those types of things are
definitely at the forefront and the planning piece. I couldn't
agree with you more. Oftentimes we're meeting with people who
are on the prespice of retirement, and if they fall
short on their planning, then they almost are turning to
us to saying, all right, I'm ready to go. But
(25:24):
if we had met three or four years prior, we
could have put in a plan to place, particularly on
the savings front, to be very aggressive because usually in
those later years of your career, you're making the most
money that you have, and that is likely the best
time that you have to save more. The kids are
likely out of the house or off the payroll and
cause tuitions, So that sixty to sixty five range you
mentioned can be a real significant time to increase your savings.
(25:47):
So better to do that knowing at fifty five or
sixty I'm about to turn it up and save a
lot during this period of time than just come in
at sixty five and say, hey, I'm ready to go.
Speaker 2 (25:56):
We have a brand new guide from the Armstrong Advisor
Group for the month of December. It's called Retirement Planning
for Spouses, and there's no way to capture everything that
goes into this for a married couple, but this guy
attempts to identify which areas you should be focusing on
if you're heading forwards retirement as a married couple, and
how to assess things like when's the appropriate thing to
(26:18):
take SOCCE security, how much insurance do I need to have?
What types of insurance do I need to have as
I'm heading to that later stage. If you would like
your free copy, you can call eight hundred three nine
three for zero zero one. You can also request your
free copy of Retirement Planning for Spouses by going to
Armstrong Advisory dot com, but that number, once again is
(26:38):
eight hundred three nine three for zero zero one.
Speaker 1 (26:43):
The proceeding was paid for by Armstrong Advisory Group, a
registered investment advisor. Nothing in the ad or in any
Armstrong guide a specific financial, legal or tax advice. Consult
your own financial tax into state planning advisors before making
any investment decisions. Armstrong may contact you to offer investment
advisory services.
Speaker 2 (27:00):
Four one k's are minting a generation of moderate millionaires.
That's what UBS is calling them. Any well, ubf ubs
UBF UBF has dubbed them the moderate millionaires, with assets
ranging from a million to five million dollars. And their
point about this term moderate millionaires, which I'm not sure
I like, but the term millionaire generally to me at least,
(27:24):
does bring images of Scrooge McDuck with his top hat
and diving into his piles of gold. And their point
is that given how the retirement systems have shifted in
the US, given how investments have performed over the last
few years, that you have this new group of people
who are generally pretty close to retirement but generally think
of themselves as firmly middle class, and are suddenly sitting
(27:49):
on more than a million dollars of retirement savings but
not really spending that money like previous generations of millionaires did.
Speaker 3 (27:57):
Well, it's the inflation piece, you know, that's a huge
part of it. That a million dollars today isn't what
it was ten twenty years ago. And I had a
couple a social gathering or two, I've had somebody ask
me off cuff, you know, hey, how much would someone
around this area need to retire? And this kind of
spins back to some of the stuff we do on
(28:18):
a day to day basis. But the answer, it's so hard, Mike,
to give that answer to somebody because someone who's pushing,
you know, g wagons and properties everywhere, the number is
a lot different than somebody who's you know, cruising a
little bit more affordability. But I would agree, in Massachusetts
or some of these Northeast states, a million dollars it
(28:39):
doesn't get you as far as it used to, for sure.
Speaker 2 (28:42):
By the way, that inflation piece is important because Scrooge
McDuck first made his appearance in December of nineteen forty seven,
so it's not exactly a new reference. I did not
think Scrooge McDuck went back that far. But I do.
Speaker 4 (28:55):
Remember this everyone because that is going to be our
trivia question.
Speaker 2 (28:58):
Huge and McDuck nineteen forty seven according to AI, So yeah,
having a million bucks in your four oh one k,
you're right, is not quite quite what it used to be.
But nonetheless there's you know, whether it's Fidelity or Vanguard,
they're all reporting more and more of their four oh
one k participants are at that threshold or higher.
Speaker 3 (29:19):
Now the market's gone up.
Speaker 2 (29:20):
Quick break when we come back. Stack Roulette is next.
Speaker 1 (29:26):
Here The Financial Exchange every day from eleven to noon
non Serious XM's Business Radio Channel one thirty two. Keep
it here for the latest business and financial news and
the trends on Wall Street. The Financial Exchange is now
life on Serious XM's Business Radio channel one thirty two.
He's the Financial Exchange Radio Network. Find daily interviews and
(29:48):
full shows of the Financial Exchange on how are YouTube page.
Get cut up on anything and everything you might have missed.
This is the Financial Exchange Radio Network.
Speaker 4 (29:59):
This levee of the financial exchange is brought to you
by the US Virgin Islands Department of Tourism. There's still
time to book your holiday vacation at Saint Croix, Saint Thomas,
or Saint John enjoy one or all three. If you
act fast, you could be on Saint Croix to experience
their Crucians Christmas Festival, taking place this December through early January.
(30:21):
Discover the magic of this long standing tradition with incredible food,
music and entertainment. Or just go to soak up the sun,
stroll along white sand beaches and feel the rhythm of
the heartbeat of the Islands. The us v I is
America's Caribbean paradise. Plan your winter escape now at us
v I dot com. That's visit us v I dot com.
Speaker 2 (30:53):
Boston Road Today. Deciding that this is the worst Christmas
song for US, I have to say it's probably up there.
It is a pretty terrible song. Paul McCartney, I don't
know why you went about this, but I'm not sure
it's the worst. I do like the description of this song. First,
they describe Grandma got run over by a reindeer as
(31:15):
the audio equivalent of drinking kurdled eggnog that's been leasd
with moonshine distilled in Jeff fox Worthy's bathtub. I don't
know which AI wrote that, but that, yeah, that's a
pretty good insult. I do like that. Uh, personally, Wham's
Last Christmas way worse than either of those two songs. Yes,
(31:36):
I'm just gonna throw that out there as worse than
all of them. Do you guys have any contenders? By
the way, you can text the show if you have
a contender for worst ever Christmas song six one, seven
three six two thirteen eighty five. I feel like this
time of year, we do all hear them in the
stores and just like something turns in my head a
little bit when I hear one of them that really
gets me upset. And uh, but yeah, I'm hearing it
(31:59):
constantly across all the stores, and those are two of
them that just I can't stand. In fact, we were
listening to Grandma got run over by a reindeer, and
my nine year old, who never listens to lyrics, like
listen to the lyrics and she's like, oh, oh god,
did they say that she? I think she like drank
something or too much or something, and then you know
(32:20):
Grandpa founder dead and that's you know why they believe
in Santa Claus. Now, I that is a pretty rough
one for a nine year old. That's a miracle. Anybody
else have any contenders for worse Christmas?
Speaker 3 (32:33):
I would have gone simply having a wonderful Christmas Time
Every year. I have the sam recurring thought in my
head when these songs kew up again, I'm like, this
is the best musical business model decision ever to have
if you can successfully make it into the rotation of
them like and Sync did one and my wife still
plays it to this day, the n Sync like Christmas
songs that they've done, and other artists have done this too.
(32:55):
Michael Buble has done a Christmas album, but like, if
you can get to be one of those big players,
none other than Murah Carrey is the absolute queen of
this and has made it a annual spiel of hers
to just try and take over the Christmas time airways.
She does have probably the best one out there.
Speaker 2 (33:11):
Yeah I've got it, saying Michael Bubla. There's a famous
image of give of him walking out of a cave
and you know, did someone say Christmas and he was
interviewed and somebody asked him about this, and he was like, guys,
we gotta stop. I have thirty friends that send that
same exact picture to me every single year the day
after Thanksgiving. So yeah, yeah, pretty good gig if you can,
(33:34):
you know, get one of the.
Speaker 4 (33:36):
We're missing an obvious one here. I think, hands down
the absolute worst of all of them. Christmas wrapping by
the waitresses.
Speaker 2 (33:44):
Oh, actually I put it into my rotation.
Speaker 3 (33:47):
Oh you like it?
Speaker 2 (33:48):
I like it? Yeah, Yeah, I'm gonna talk to you
from now on. Well, yeah, i'd say, how does it go?
Speaker 3 (33:55):
But I don't really want to hear either of you
guys sing.
Speaker 2 (33:57):
Yeah you don't anything by Alvin and the Chipmunk's terrible.
I start to cringe when I hear that, So I
really that one just distresses me a little bit. Yeah. Again,
if you have a least favorite Christmas song textas at
six one seven or I guess favorite will highlight the favorites.
(34:17):
But six one seven, three, six, two, thirteen eighty five,
what do you have for us? Or stack with that?
Speaker 3 (34:21):
Pol from Lamas to Avocado's Meta's shifting AI strategy is
causing internal confusion. I couldn't resist doing one more artificial intelligence.
Speaker 2 (34:32):
Story, especially to pick on Meta at the same.
Speaker 3 (34:34):
Well, that's kind of where I wanted to go with
this is when you look at the players in the
artificial intelligence game, which is fascinating me just because there
is so much a stake from a monetary and you know,
stock market perspective. Meta is often like that person in
high school that is maybe knocking out knocking the door
(34:55):
of all the cool parties, but not really being let in,
uh with open arms. Because it is trying to be clear.
MENA has benefited significantly or Facebook from artificial intelligence the
reels or the advertisements that you're served up on your Instagram,
and Facebook is a benefactor from just machine learning and
(35:16):
our official intelligence to putting the right ad in front
of you, and that's led to a lot of profitability
for them. However, when it comes to the large language
model stuff, they are barely mentioned. When it comes to
talking the big players at all. Tessa or Eon muss
Xai is one, or Groc that's one that's up there,
Anthropic and many others out there, but they are just
(35:37):
like a drunken sailor in terms of their spending and
just going after this problem. It's just like, I'm just
gonna throw all this money at this and maybe we'll
become a player in this. Avocados is supposed to be
their new large language model that's coming out. Lamas was
the previous one they're naming conventions for these are also
mind boggling. I guess you do remember them by how
(35:58):
obscure they are. But they have thrown own billions of
dollars at the problem, and I wonder that this fear
of missing out for them could cause further issues for
the company in just terms of what they're spending. They
still have such a profile business model. Instagram is still
an absolute giant out there. WhatsApp is a great business too.
But it's just funny to see them spin their.
Speaker 2 (36:20):
Wheels on the naming conventions. I'll just acknowledge that they're
not alone in this one. Google's new image generator is
called Nano Banana, So like, at least they're in good
company with naming their ais stupidly, which I feel like
is their way of not making them quite as scary. Sure,
(36:40):
you know, like if you're going to get attacked by
a future AI and it's called chat GPT five point three,
that's kind of scary where if it's nano banana, how
much like how that's what I would do too if
I was if I was inventing a world ending technology,
I would definitely name it something like avocado. But yeah,
(37:01):
the question is can Meta throw good money after a
good project. After sinking tens of billions if not more,
into their metaverse, which still open, produced nothing, And finally
they've taken a step back and said, yeah, we're going
to divert some of the money from that continued investment
(37:22):
into artificial intelligence. But yeah, that's I don't quite see
what the path is for Meta, because I don't think
anyone really likes using their products. They do because their
friends are on there, But I don't know what's going
to make me use a large language model from Facebook
versus Google's or anybody else's. But maybe they've got something
(37:44):
else going on if they if they can sell more
ads at a higher profit because of AI than anything
that I'm saying is pretty irrelevant. And clearly they are
not having any issues with getting lots of posts of
AI generated videos on their platform, because that's all that
I see.
Speaker 3 (38:00):
The Facebook post ones are crazy.
Speaker 2 (38:02):
Yeah, markets are open and remain in positive territory with
the Dow leading the way up three ten percent. Will
have a FED meeting tomorrow and a full market recap
and more. Then, have a great rest of your day, folks,
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