May 4, 2026 • 38 mins
Housing pressure is building as higher rates and rising costs start to take a toll.
Chuck Zodda and Mike Armstrong break down early signs of stress in the housing market as mortgage rates rise and affordability remains stretched.
Also covered:
Chuck Zodda and Mike Armstrong break down early signs of stress in the housing market as mortgage rates rise and affordability remains stretched.
Also covered:
- Why rising foreclosures are increasing but not yet a crisis
- What a 5% 30-year Treasury yield means for mortgage rates
- How higher borrowing costs are reshaping housing demand
- The growing push to tax second homes and its potential impact
- Why rising oil prices could add new pressure to the economy
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Episode Transcript
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Speaker 1 (00:00):
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(00:20):
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(00:42):
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(01:05):
Chuck Zada and Mike Armstrong.
Speaker 2 (01:18):
It's Chuck, it is Mike, and it's Tucker two, all
three of us here. And as we kick things off today,
we've got stocks not really doing much of anything in
the aggregate right now.
Speaker 3 (01:33):
The Dow is off.
Speaker 2 (01:34):
Two hundred and six points, the S and P is
up to the Nasdaq composits up forty nine, So just
kind of treading water. Nothing too exciting going on in
stockworld bond world. We do have something interesting. The thirty
year treasury just cross five percent again and the tenures
up another four point two base points to four four
to two, and so this is going to put further
(01:57):
pressure on mortgage rates, which closed on Friday at six four,
probably getting back close to six fifty somewhere in that ballpark,
depending on how the rest of.
Speaker 3 (02:05):
The day goes. Here.
Speaker 2 (02:07):
The news on Horn moves a whole bunch of chatter
about different things from either side.
Speaker 3 (02:13):
It's been kind of a wild morning. Actually.
Speaker 2 (02:16):
At around six twenty, Iran's Fars News Network, which is
state affiliated media, said that a US destroyer had been
struck by two missiles. The United States denied that and
subsequently indicated that there were two destroyers now operating within
the Persian Gulf after transiting overnight and letting a couple.
Speaker 3 (02:37):
Of ships out.
Speaker 2 (02:39):
There also have been a couple of different civilian ships
that have been struck overnight, and as we sit right now,
the UAE has indicated that their missile defense systems are
active and locals are reporting explosions, but no one really
knows what's going on because we're not really getting a
ton of informations. So I think the big thing, the
(03:01):
strait largely remains closed. We'll see if transit picks up,
but to this point no meaningful uptick in transit.
Speaker 3 (03:08):
Did you just talk about South Korea? The South Korean
tanker that got hit.
Speaker 4 (03:13):
Yes, South Korean media has now confirmed it. So the
South Korean Foreign Ministry confirmed that a general cargo vessel
was anchored near the UAE and quote caught fire after
an explosion.
Speaker 2 (03:25):
And it was a UA tanker that was empty that
was struck as well overnight with two Iranian drones. So again,
this week is kind of a pivotal one. Things are
either gonna heat up militarily again or I think something
starts to you know, kind of ease meaningfully, just because
(03:46):
I don't think you can continue to have this ramp
up of rhetoric and you know, and poking and prodding
actions from each side without eventually something escalating further.
Speaker 3 (03:58):
And it's a very unstable equilibrium.
Speaker 2 (04:01):
And so it's either you got to figure some way
to get this thing moving or it feels like things
are going to escalate. Is kind of where this week
is right now, let's talk a little bit about the FED. Well,
actually I didn't go through the rest of markets. Yeah,
so let me finish wrapping things up there. Dollar index
is up point one nine ninety eight nineteen, gold is
off sixty seven to thirty an ounce to fift forty
(04:24):
five seventy seven, and crude oil West Texts Intermediate up
a dollar thirty five. Brent crewed up four dollars a barrel,
so you've got some renewed upward pressure on oil prices.
Triple A national average for gas is above four to
forty five a gallon. Now diesel is within seventeen cents
(04:44):
of the twenty twenty two high, and barring anything shocking,
diesel's got a pretty good chance of hitting that high
sometime in the next week to ten days.
Speaker 4 (04:53):
So last week, Chuck, we had j Powell's final press
conference as.
Speaker 3 (04:57):
Chairman of the Federal Reserve. We also got the news
from him that.
Speaker 4 (05:02):
He's going to be staying on in his role as governor,
which I did not think was likely even very recently.
Speaker 3 (05:11):
And they are facing this.
Speaker 4 (05:14):
Well, this problem with risk of higher inflation, and they've
been dealing with that problem of higher inflation since twenty
twenty two, never quite getting back to their two percent target.
With a new chair coming in, I guess I have
a multitude of questions here. I mean, one of which
is how high do oil prices need to get before
you start being more worried about a growth problem in
(05:35):
the US than you do an inflation problem. But two,
and this is the bigger one. Kevin worsh has pretty
clearly wanted to be on a path of lowering interest rates.
The Fed never has gotten back to their two percent target.
They keep saying that they have a target. Is it
even still meaningful anymore to have a two percent inflation
target at this point given they don't seem fundamentally serious
(05:57):
about getting.
Speaker 3 (05:58):
Back to it.
Speaker 2 (05:58):
Here's the thing I don't think I agree with you.
You can't kill the two percent inflation target before you
get there though I.
Speaker 4 (06:07):
Think you shouldn't, but I have no evidence that Kevin
Worsh is going to follow your thinking on that.
Speaker 2 (06:13):
It's one where And look, here's ultimately how this ends
up working is if with anyone to talk to anyone
who has lived in Brazil, talk to anyone who's lived
in Argentina, talk to anyone wh's lived in South Africa, Turkey,
places that have dealt with monetary messiness, policy procedure that
(06:34):
has gone awry. What they'll tell you is, look, ultimately,
if the central bank decides to start cutting or changing
policy more dubbishly while things are still too hot, it
has the opposite effect that you intend yeh, because it's
basically saying, Okay, we're gonna run the economy hot, and
the long end of the yield curve ten year bonds,
thirty year bonds, they blow out top side because the
(06:55):
bond markets is fine. You're not serious about this great,
We don't want to own the long term bonds. Because
if you think of it this way, if you buy
a long term bond in the US right now, a
thirty year treasury, the US government gives you five percent
a year for the next thirty years and you say,
remember the people who buy those and just hold them.
(07:15):
It's mostly insurance companies and things like that.
Speaker 3 (07:18):
Big institutions, not just insurance companies.
Speaker 2 (07:20):
But yeah, yeah, like pension plans, like there aren't very
many individuals who just are scouring, you know, the brokerage
sites for like, hey, what's the best thirty.
Speaker 3 (07:30):
Year treasury bond? And it's just not how it works.
Speaker 2 (07:34):
So you've got these liabilities that you're pricing out thirty
years into the future, and as an insurer, you're saying, Okay,
here's what inflation's gonna be, here's you know, the policies
that I have, Here's what I need to hedge for.
If the central bank says, hey, we don't care about
inflation in the short term, you, as that buyer, immediately say, well,
(07:55):
I got to get paid something else otherwise I might
be underwater in thirty years. And so yeah, five isn't
gonna cut it. You gotta pay me five and a
half yep in order to compensate me properly for that risk.
And so this is the thing where ultimately, I here's
the thing about you know, everyone's really skeptical that warsh
(08:15):
is going to do a good job. And I'm not everyone,
but like you're getting this church back that he's going
to be just a totally a flunky, a lackey, Like
there's all kinds of words that we can use for
the Trump administration. He may be, he may not. I
don't know, because he hasn't done anything yet. What I
do know is that Scott Bessen, in the year leading
up to him being appointed Treasury Secretary, talked all about, hey,
(08:38):
Janet Yelling's selling this mix of bonds, like how could
she do this?
Speaker 3 (08:42):
Blah blah blah. It's wrong.
Speaker 4 (08:44):
It's very critical of the members of the Bid administration
in order to get considered for the job of Treasury secretary.
Speaker 2 (08:50):
And Besson took the job and basically hasn't made a
shift in terms of bond isshuins from what Yellen was doing.
It's the exact same or within sniffing distance of it.
So part of this, I'm a big believer that, hey,
a lot of people, you know, when you're camp paigning
for any job, A lot of people and I'm not
saying this is right, but a lot of people today
like you say what you need to do in order
(09:11):
to get the job, and when you then get into
the seat, especially a seat like you know, chair of
the Federal Reserve. You understand the gravity of the situation.
And just like Scott bessen didn't just upend the entire
model of Hey, here's the issuance that we're gonna do
for US Treasury bonds. I suspect that Kevin warsh is
(09:32):
not going to want his legacy to be the dude
that you know, brought on the second peak in inflation
in the twenty twenties.
Speaker 3 (09:40):
I tend to agree one caveat that I'll throw out here.
Speaker 4 (09:44):
Uh, President Trump was not criticizing the intricacies of bond
issuance by the Biden administration, or at least not heavily.
H He has been for the last several years criticizing
the Federal Reserve directly and calling specific for lower interest rates.
And I view those two as different, Right, Scott Bessont
found something to criticize about the bid administration that he
(10:07):
took issue with.
Speaker 3 (10:08):
Here.
Speaker 4 (10:09):
Kevin Walsh has you know, stated publicly that he is
in agreement with the President about where interest rates should go.
And the President has been much more public about that
criticism than what best and flatched onto.
Speaker 3 (10:21):
So again fair, you know, we will have to wait
and see. I am with you.
Speaker 4 (10:27):
Judge people by their actions, not by their words, and
Worsh has not had time to take any actions to
this point. But I do very much fear the move
away from a two percent inflation target because already as
it is, when I ask people, I'm not talking about
trained economists. I'm talking about retirees and the general public
(10:50):
that I speak to. And I asked them, hey, you know,
if you had to bet, will inflation be hotter.
Speaker 3 (10:54):
Than the last decade or cooler than the last decade?
Speaker 4 (10:57):
The answer is almost universally hotter now probably not actually
thinking about the measurement of the last decade includes twenty
twenty two when we saw nine percent inflation. But when
you ask that question, it's hotter. I think inflation expectations
are substantially hotter than they were for the last decade,
and that can be a problem for the FED.
Speaker 2 (11:17):
Let's take a quick break. When we come back. I
got a couple of housing pieces I want to cover.
We've also got trivia next.
Speaker 1 (11:24):
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(11:45):
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Speaker 5 (11:49):
Time for trivia here on the Financial Exchange. On this day,
in nineteen seventy nine, the United Kingdom elected their first
ever female prime minister. She would go on to serve
three consecutive terms, becoming the longest serving prime minister in
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Speaker 3 (12:45):
A little bit of news here from the UAE.
Speaker 2 (12:49):
The UAE Ministry of Defense has now confirmed that they
detected four cruise missiles launched them from Iran and the
sounds heard by residents, three out of the four being intercepted,
while another one splashed down off the coast. This is
in turn, probably what's pressuring stocks to the tune of
about a half percent fall in the last five or
(13:09):
ten minutes.
Speaker 3 (13:10):
Now.
Speaker 4 (13:10):
Sorry to be clear, this was not a strike on
in a UAE flight vessel. This was a strike on
the United Air Emirates. It's untempted strike.
Speaker 2 (13:18):
It's unclear exactly where these were intercepted and what the
targets are. We don't know specifically, but it does appear
that they were heading towards the UAE the country, not
necessarily vessels.
Speaker 4 (13:32):
And I did say that they had put residents under
you know, strike warnings, so.
Speaker 2 (13:37):
That they did that earlier today, but that turned out
to not be a an actual attack. In this case,
it does appear that the UAE has confirmed that missiles
were fired at them from Iran.
Speaker 3 (13:52):
It's felt for the last.
Speaker 2 (13:53):
Week or so that the UA and Iran are not
in a good spot right now, is a nice.
Speaker 3 (13:59):
Way of putting it.
Speaker 2 (14:00):
Even if everything goes well and improves here over the
coming months. It would not surprise me if the two
of them have their own little affair over the next
few years, just because there's no love loss between the.
Speaker 3 (14:14):
Two of them.
Speaker 2 (14:14):
Right now, let's talk a little bit about housing again.
What will update you as we know more, but just
again something relevant and market moving there. First from the
Wall Street Journal, high housing costs are pushing foreclosures to
a six year high. Homes with foreclosure filings twenty six
percent in the first quarter.
Speaker 3 (14:34):
Here's the thing.
Speaker 2 (14:35):
Housing foreclosures are not a problem for the broad US
economy because they are coming off such a low level
that this is not something that is problematic in any way.
Speaker 3 (14:46):
Shape or form.
Speaker 2 (14:47):
It's not to say that certain families aren't having trouble
paying these higher housing costs. I understand that it's tough
for you know, families that are out there dealing with these,
but when we talk about foreclosures becoming a problem, it's
not something that has impacting the US economy in any way,
shape or formulat.
Speaker 4 (15:02):
So the last quarter that the Saint Louis FED has
data on was the fourth quarter, so we'll get an
update soon on this. But the rate of delinquency on
single family residential mortgages was one point seven to eight
percent in that fourth quarter if it hit. It was
about the same in the first quarter of last year.
So a twenty five percent jump on that right might
bring you to the low twos. We did not get
(15:25):
below two point three four percent delinquency rate on mortgages
at any point during the twenty ten decade. Yes, so
if we start pushing delinquency rates over three percent, we've
got a problem.
Speaker 3 (15:39):
They like, again, not a problem for the you.
Speaker 4 (15:43):
Know, the state of banks or anything like that in
my view, but you know that that is a meaningful
problem because we didn't really spend much time above three
percent anytime other than the Great Financial Crisis. But we
are not in problem territory with mortgages. So one don't
plan on getting a whole bunch of deals on foreclosed
homes and to don't worry about this in the context
(16:04):
the greater economy.
Speaker 3 (16:05):
No, I would agree.
Speaker 2 (16:07):
Another piece here that I do think is interesting for
a broader discussion. Taxes on second homes are springing up
across America, and so you've got different local governments that
are coming out and saying, hey, if you have homes
that are not primary residences. I don't speak French. What
(16:31):
does that even mean in French? I don't speak French.
Ped p I E d ar t e r r
e I. I don't know what it means in French.
Seem to be I'm guessing terror is something about like
land or earth, and ped is probably like usually that's
like foot in the Romance languages, so like foot of
the earth.
Speaker 5 (16:51):
I don't know, smaller second home or studio, foot.
Speaker 4 (16:56):
And mouths, foot to the earth, foot to earth or
foot on the ground. Okay, it's the literal translation, but
it refers to yes, an apartment in New York City
pretty much.
Speaker 3 (17:04):
Okay, so yeah, so you've got you got New York City.
Speaker 2 (17:09):
New York City is planning on taxing an additional property
tax for second homes worth five million or more.
Speaker 4 (17:17):
Rhode Island is considering a Taylor Swift tax on homes
over one million dollars, and New Hampshire recently voted down,
but it did make it to a vote a tax
on second homes worth over half a million dollars. So
many different places are testing this stuff out.
Speaker 3 (17:32):
Guys, this is dumb.
Speaker 2 (17:36):
If you think housing is too expensive for the people
in your jurisdiction to buy it, build more. That's the
like again, if you want to tax it. Finally, here's
the impact that it'll have. It will make that house
more affordable because in order for people to be able
to buy it and pay the taxes, the headline price
will have to come down. Yeah, like that, that is
(17:57):
something that will happen.
Speaker 4 (17:59):
So, Chuck, you owned home in Summerville. Yes, and this
is exactly like. This is not a new idea. I
owned one too in Summerville. You got around a thirty
percent property tax discount.
Speaker 2 (18:10):
It was a flat value. It was a two hundred
and fifty thousand abatement on the valuation.
Speaker 3 (18:14):
Was it. Yeah, I don't recall it.
Speaker 4 (18:16):
But anyway, for living in your home in Somerville, for
being for making that your primary residence, you got, you
know what, worked out to be a pretty substantial property
tax cut for doing so. So plenty of places have
tested this out. That would be another way of getting
at the exact same thing, you know, saying, hey, primary residences,
you do this. You know New York is calling it
your second home tax. It's not a new concept to
(18:38):
build more houses, but it's not going to fix the
housing problem.
Speaker 2 (18:40):
Build you want cheaper housing, build more housing. You want
evidence of this, look at Austin, Texas during the big
you know twenty twenty one twenty two relocation frenzy. Austin
Texas said, well, it didn't say it because the city
can't speak, but the people in Austin, Texas said, hey,
we got to build way more housing, and they did,
and rents have been falling ever since because oh gee,
(19:04):
when you actually supply the needed housing on the market,
rents end up falling.
Speaker 3 (19:08):
I don't one difference here.
Speaker 4 (19:10):
I don't see this as a proposal to make housing
more affordable.
Speaker 3 (19:14):
Which is why it's well, no, I think it's mainly
this will No.
Speaker 4 (19:17):
I think it's mainly a hey that we want to
tax the rich and we need to, you know, figure
out how to do that, and so this is our
way of doing that, rather than hey, this is going.
Speaker 3 (19:25):
To solve our housing affordability problems. Take a quick break.
I want to discuss this more when we return.
Speaker 1 (19:40):
Bringing the latest financial news straight to your radio every day,
it's the Financial Exchange on the Financial Exchange Radio Network.
Tell you out whoa street watch treking, the stocks, the
data and the headlines driving markets so far today right
here on the financial.
Speaker 5 (19:58):
Exchange turned lower, with oil prices jumping higher as a
result of increased military tensions with the strata for moves,
specifically with the developing situation involving.
Speaker 3 (20:12):
Iran and the UAE.
Speaker 5 (20:13):
More than that coming up here right now, the Dow
is down eight tenths of a percent or four one
hundred and one points, SMP five hundred down over a
third of a percent, NASDAC down about a third of
a percent as well. Russell two thousand is up about
a tenth of percent, and Your Treasure reeled up five
basis points at four point four to three six percent,
and oil jumping nearly four percent higher training at one
(20:36):
hundred and five dollars a barrel. Aside from around the
big development over the weekend came from game Stop after
CEO Ryan Cohen made an unsolicited offer to buy eBay
for about fifty six billion dollars. Cohen told The Wall
Street Journal that putting his video game retailer and eBay
under one roof could create opportunities to cut costs and
(20:58):
improve earnings. eBay up by four percent while game Stop
is down by about six percent. Me Myles shares in
Norwegian Cruise Line dropping eight percent after the company cut
its outlook, citing higher fuel prices and also said consumers
are rethinking travel plans. Elsewhere, Tyson Food posted better than
expected quarterly results but said soaring cattle prices weight on
(21:19):
its results. And after today's closing bell, we'll see earnings
from Paramount Sky Dance and Pallenteer. I'm Tucker Silvan. That
is Wall Street Watch. On the previous segment, we asked
you the trivia question, who is the UK's first female
prime Minister? That would be Margaret Thatcher in Our winner
today was George from Wall Fame ass taking on the
Financial Exchange Show T shirt. Congrats to George and we
(21:40):
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complete contest rules at Financial Exchange Show dot com.
Speaker 2 (21:47):
A little bit earlier in the show, we indicated a
confirmation from the UAE Ministry of Defense that air defenses
had been activated as they had four cruise missiles from
Iran that were attacking them and three of the four
had been intercepted the fourth had splashed down in the sea.
(22:09):
A second post from the UAE Ministry of Defense now
that the UAE is engaging with additional missile attacks, including
drones and ballistic missiles and cruise missiles from Iran. Also
indications that oil facilities near the Gulf of Oman port
(22:34):
of fuji Era are now.
Speaker 3 (22:38):
Apparently on fire.
Speaker 2 (22:39):
It doesn't it's not clear if it was from debris
or if something got through.
Speaker 3 (22:45):
But again, you've got.
Speaker 2 (22:46):
A little bit of an escalation that appears to be
happening here, and we'll see where this goes In response,
tucking it at oils up ten year treasury now up
six bases points on the day, and the thirty year
five point three to five point one nine percent, So
the thirty year breaching that five percent level UH for
the first time in a while here, and again everyone's
(23:11):
been pretty itchy in the UH, in the region for the.
Speaker 3 (23:14):
Last couple of weeks.
Speaker 2 (23:16):
We'll see if this is UH, you know, something that
kind of flares out and you know, goes away over
the next twenty four to thirty six hours, or if
this flares up instead UH and becomes UH, you know,
kind of a reignition of the conflict. It's it's again
we're reporting this as we get information coming in. No
(23:37):
one really knows a Ton right now, just because the
fog of war is pretty thick.
Speaker 3 (23:42):
Uh, when we're when we're looking.
Speaker 2 (23:44):
At this, getting back to one final point that I
want to make on the second home, uh changes in
tax rates. You know Miken mentioned, Hey, this doesn't seem
to be about trying to make housing cheaper. It seems
to be about trying to tax the rich to bring
in additional tax revenue. Which also is another thing that
I get at, which is, Okay, ultimately you are trying
(24:07):
to you're trying to deal with these symptoms of a
problem and not the actual cause, and in doing so,
you're being highly inefficient. And look, if the rich people
decide okay, fine, like we're just gonna not go there. Great,
you're not gonna get the tax revenue that you want,
then oh yeah. I was not trying to voice the
abilm that I think it's a good idea to go
(24:29):
and do so. But I think clearly that's been the
push from what we've got the new proposed or did
that pass, the California Wealth tax, no idea. So there's
the California wealth tax, there is the New York City
second home tax, there's the Rhode Island proposal, and I
view again, they're all floated with a lot of different ideas,
(24:52):
but I think the clear trend that I've seen has
been a pivot away from oh yeah, we're trying to
make housing more affordable, which you know Massachusetts is gonna
vote on, for instance, a rent control bill, which is
clearly about trying to do that. We'll have the opposite effect, by.
Speaker 4 (25:05):
The way, versus what I'm seeing here, which is our
budgets are a mess. We need to raise revenue. Let's
go get it from the wealthiest in New York.
Speaker 2 (25:15):
Which will work for like three years until they're like, okay, fine,
we'll move New York. Quite honestly, New York City, you
can pull it off. Yes, there's only one New York City.
Speaker 4 (25:25):
Yeah, and you know the people that own those second
places are like, well I moved to Florida to avoid
all of the income taxes.
Speaker 2 (25:32):
I'll just pay it on the property. Well, there's only
one New York City. If you want what New York
City has to offer, that's it. As someone who's a
proud New Englander, there's a lot of beach out there.
Speaker 3 (25:46):
Okay.
Speaker 2 (25:47):
So if Rhode Island says, okay, we're doing this Okay, fine,
then you're gonna go up to Maine. And then if
Maine decides, okay, we're gonna do this, fine, then you're
gonna go down to Delaware. And if Delaware says it great,
you'll go to Like there's a lot of beach out there,
there's only one New York City.
Speaker 4 (26:03):
Always comes down to how onerous we're talking about. But yeah,
whether it's the Massachusetts Millionaire's tax or any of these
other things, what you're talking about is taxing the super wealthy.
And what the super wealthy have been I won't say
always telling you, but pretty consistently telling you is we
can find other states to live in and not dramatically
reshape our lifestyle. Whether it's Jeff Bezos and you know
(26:25):
relocation of.
Speaker 3 (26:28):
All these days.
Speaker 4 (26:29):
I think Florida, but you know he had his headquarters
in Washington State and relocated. Or who's the Google founder
who's been making a big thing out of the California
wealth tex I don't know, he wasn't the founder. In
either case, many of them are saying, look, I'll just
move to Texas. I'll move somewhere else and I might
(26:50):
keep a property there and you can tax that all
you want, but I'm not going to succumb to these things.
And yeah, it's it's not working great and even the
biggest geographic states, and I worry about what it would
mean for some of the smaller ones like Rhode Island.
Speaker 3 (27:03):
Larry Page might have been Brent. It was Brent. That
a big thing of it.
Speaker 2 (27:09):
Sorry, isn't it great that one of the founders of
Google had the last name Page.
Speaker 1 (27:14):
M M.
Speaker 2 (27:15):
You know that's like if that's like if Ford had
been founded by like Jimmy Engine.
Speaker 3 (27:20):
Folks.
Speaker 4 (27:21):
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(27:44):
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(28:40):
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Speaker 3 (28:42):
Right.
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Speaker 2 (29:37):
Let's see what do we want to cover here? Five
money lessons from readers in the trenches of elder parent care.
This piece from the New York Times.
Speaker 3 (29:45):
Mike, Yeah, so.
Speaker 4 (29:46):
Last year, about eleven four hundred Americans turned sixty five
on any given day.
Speaker 3 (29:53):
It's a lot.
Speaker 4 (29:56):
Gen xers are starting to experience this firsthand. Yeah, Millennials
will be the next to start dealing with their parents,
you know, getting to retirement or already there and running
into all sorts of complicated issues. I think a few
things that I will just generally say, having worked with
(30:16):
that generation and older generations for over a decade now, One,
your parents are generally.
Speaker 3 (30:23):
Not prepared for future health issues.
Speaker 4 (30:26):
No, financially and just emotionally, they are not quite facing
those things very.
Speaker 3 (30:33):
Transparently or clearly. Two.
Speaker 4 (30:37):
Long term care, it's not going to get cheaper in
their lifetimes. It's not going to get more affordable in
their lifetimes. Generally you could see improvements, you know, thirty
forty years from now, but in their lifetime, I do
not believe long term care is going to get cheaper.
And Three, based on my experience, you probably don't know
what they would want for their long term care scenario
(30:58):
if you needed to navigate. Those have been my conclusions,
again from act asking people about this quite a bit
over the last ten years.
Speaker 3 (31:06):
Is nobody likes to talk about it.
Speaker 4 (31:08):
Everybody's unprepared for it, and when it happens, it's oftentimes
in unmitigated mess or disaster where the rest of the
family is trying to pick it up. And the New
York Times article, you know, goes and interviews several different families,
all of whom are having either good or bad experiences
with it, but several of them are kids trying to
figure this out from across the country, oftentimes financially contributing
(31:31):
to their parents' long term care because no conversations were had,
no real planning.
Speaker 3 (31:37):
Was done, And it's a.
Speaker 4 (31:42):
It's been an issue for generations, but because the size
of the baby boomer generation, it's about to impact a
lot more people.
Speaker 2 (31:49):
Yeah, it's something where until you live that experience day
in and day out, nothing prepared like, you can't prepare
for it.
Speaker 3 (32:00):
Honestly, you can try, but until.
Speaker 2 (32:03):
You experience it's it's too theoretical for you.
Speaker 4 (32:07):
The only the only suggestion I have for the gen
xers out there who are getting ready for it is
ask a lot of questions. Ask them of your parents'
financial advisor, ask them of your parents yourself if they
will give you the information, but ask about what the
plan is because, like I said, the vast majority of
people unprepared for it. And two stats that I think
most people don't understand. Average life expectancy is not relevant
(32:28):
when you're talking about living people in their sixties. No,
the life expectancy for a sixty five year old woman
is eighty seven years old. For a man it's eighty four.
And the chances that a sixty five year old woman
reaches age ninety is now forty percent. It's thirty percent
for men. We're talking about a lot of people that
live to ninety to one hundred years old over the
(32:49):
course of the next twenty years, and their financial situations
are not prepared for that reality.
Speaker 3 (32:55):
To take a quick break, when we return, we've got
stack Roulette.
Speaker 1 (33:00):
From markets to money to business and financial news. Watch
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(33:21):
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Speaker 5 (33:42):
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Speaker 3 (34:19):
Mike, what do you got for stack Roulette? For me?
Speaker 4 (34:22):
Let's talk a little bit about gambling sites that are
continue to disguise themselves as futures commodities traders. So Polymarket
and Calci are the two big ones out there, but
they have mirrored the growth that you have seen on
online sports gambling. And the Wallstreet Journal had a pretty
interesting piece for those that aren't already very aware of
(34:44):
what's going on there. They interview a John Peterson who's
now in a homeless shelter after, you know, wasn't in
great financial shape before turned two thousand dollars into forty
one thousand dollars before losing it all on one, you know,
as gamblers do one final bet on these platforms, now
living in a homeless shelter, but a few pieces that
(35:05):
they found. The Wall Street Journal did about these sites
that you know, I think are enlightening and interesting and
important to better understand. One, on poly Market, sixty seven
percent of profits go to just zero point one percent
of accounts, meaning less than two thousand accounts total net
a total of nearly half.
Speaker 3 (35:25):
A billion dollars.
Speaker 4 (35:28):
They also, again, what I think is most important here
is they are not regulated like gambling sites. In fact,
recently Polymarket was running a pay my rent advertisement where oh,
you know, basically like, hey, no longer have the money
to pay your rent, maybe you can make some on
poly market to be able to afford that, to which
I ask, would any state in the country allow a casino?
(35:51):
Can you imagine the Mohegan Sun running an advertisement like, hey,
running out of money to pay your rent, come on down,
maybe you can make it up on.
Speaker 3 (35:59):
Craps, because that's what this is.
Speaker 4 (36:02):
Yes, And my concern is that, hey, it's not regulated
anywhere like it. By the way, they don't run that
ad anymore, but they but they did, and two more
and more, it seems to me that these what are
very clearly akin to gambling platforms are being advertised as
(36:23):
one legal gambling and two investing in some way, and
they are neither correct, and that I think in lies
the problem. And I do worry about you know, Robin
Hood and others who are beginning to place these platforms
on their brokerage websites really muddying the waters even further
(36:43):
between what is gambling and what is investing.
Speaker 3 (36:45):
I've kind of had it with them at this point. Yeah,
you know, like, yeah.
Speaker 2 (36:51):
People, everyone is out there is like, oh, well, it's great.
You can now if you like have an idea, you
can put your money where you're mouth is. Maybe I
don't want to. Maybe I just want to have a
conversation about something. I don't need to bet on everything.
Speaker 4 (37:05):
And it is so pervasive. I was talking to I
was at a reunion over the weekend and it was
you know, classes from several different age groups, and yeah,
of course all of the recent college grads were talking
about all of their bets on the basketball game and
like every playoff game out there, and all the money
that they were losing.
Speaker 3 (37:25):
And it's which is such.
Speaker 4 (37:27):
A part of the lifestyle that is just not for
all of the people that were in my age EMO, and.
Speaker 2 (37:31):
Quite honestly, it's a boring part of the lifestyle. I'll
pass judgment as someone who you know does actually go
to casinos and gamble. I know that no one wants
to hear about the bad beats that I got on
a back jackhand.
Speaker 3 (37:46):
Right because it's not interesting. It's not interesting. I'd rather
hear about your dream, So like, stop.
Speaker 2 (37:52):
Telling me about well, I bet on this, and this
is how we're I don't care. Like if the most
interesting thing that happened to you today is that you
like put a bet on how many points Larry Bird
would score whatever, the answer was zero.
Speaker 3 (38:11):
He didn't score any yesterday.
Speaker 2 (38:13):
We're gonna take a quick break for the rest of
the day and we'll be back tomorrow. And if you
didn't like our show today, we're gonna try harder, we promise.
The Financial Exchange is produced by Money Matters Radio and
is hosted by employees of the Armstrong Advisory Group, a
registered investment advisor. All opinions expressed are solely those of
the hosts. Do not reflect the opinions of Armstrong Advisory
or anyone else. Investments can lose money. This program does
not offer any specific financial or investment advice. Please consult
your own financial, tax, and estate planning advisors before making
(00:20):
any investment decisions. Armstrong Advisory and the advertisers heard on
this program do not endorse each other or their services.
Armstrong and Money Matters Radio do not compensate each other
for referrals and are not affiliated. This is the Financial
Exchange with Chuck Zada and Mike Armstrong, Your exclusive look
at business and financial news affecting your day, your city,
(00:42):
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making a donation today. This is the Financial Exchange with
(01:05):
Chuck Zada and Mike Armstrong.
Speaker 2 (01:18):
It's Chuck, it is Mike, and it's Tucker two, all
three of us here. And as we kick things off today,
we've got stocks not really doing much of anything in
the aggregate right now.
Speaker 3 (01:33):
The Dow is off.
Speaker 2 (01:34):
Two hundred and six points, the S and P is
up to the Nasdaq composits up forty nine, So just
kind of treading water. Nothing too exciting going on in
stockworld bond world. We do have something interesting. The thirty
year treasury just cross five percent again and the tenures
up another four point two base points to four four
to two, and so this is going to put further
(01:57):
pressure on mortgage rates, which closed on Friday at six four,
probably getting back close to six fifty somewhere in that ballpark,
depending on how the rest of.
Speaker 3 (02:05):
The day goes. Here.
Speaker 2 (02:07):
The news on Horn moves a whole bunch of chatter
about different things from either side.
Speaker 3 (02:13):
It's been kind of a wild morning. Actually.
Speaker 2 (02:16):
At around six twenty, Iran's Fars News Network, which is
state affiliated media, said that a US destroyer had been
struck by two missiles. The United States denied that and
subsequently indicated that there were two destroyers now operating within
the Persian Gulf after transiting overnight and letting a couple.
Speaker 3 (02:37):
Of ships out.
Speaker 2 (02:39):
There also have been a couple of different civilian ships
that have been struck overnight, and as we sit right now,
the UAE has indicated that their missile defense systems are
active and locals are reporting explosions, but no one really
knows what's going on because we're not really getting a
ton of informations. So I think the big thing, the
(03:01):
strait largely remains closed. We'll see if transit picks up,
but to this point no meaningful uptick in transit.
Speaker 3 (03:08):
Did you just talk about South Korea? The South Korean
tanker that got hit.
Speaker 4 (03:13):
Yes, South Korean media has now confirmed it. So the
South Korean Foreign Ministry confirmed that a general cargo vessel
was anchored near the UAE and quote caught fire after
an explosion.
Speaker 2 (03:25):
And it was a UA tanker that was empty that
was struck as well overnight with two Iranian drones. So again,
this week is kind of a pivotal one. Things are
either gonna heat up militarily again or I think something
starts to you know, kind of ease meaningfully, just because
(03:46):
I don't think you can continue to have this ramp
up of rhetoric and you know, and poking and prodding
actions from each side without eventually something escalating further.
Speaker 3 (03:58):
And it's a very unstable equilibrium.
Speaker 2 (04:01):
And so it's either you got to figure some way
to get this thing moving or it feels like things
are going to escalate. Is kind of where this week
is right now, let's talk a little bit about the FED. Well,
actually I didn't go through the rest of markets. Yeah,
so let me finish wrapping things up there. Dollar index
is up point one nine ninety eight nineteen, gold is
off sixty seven to thirty an ounce to fift forty
(04:24):
five seventy seven, and crude oil West Texts Intermediate up
a dollar thirty five. Brent crewed up four dollars a barrel,
so you've got some renewed upward pressure on oil prices.
Triple A national average for gas is above four to
forty five a gallon. Now diesel is within seventeen cents
(04:44):
of the twenty twenty two high, and barring anything shocking,
diesel's got a pretty good chance of hitting that high
sometime in the next week to ten days.
Speaker 4 (04:53):
So last week, Chuck, we had j Powell's final press
conference as.
Speaker 3 (04:57):
Chairman of the Federal Reserve. We also got the news
from him that.
Speaker 4 (05:02):
He's going to be staying on in his role as governor,
which I did not think was likely even very recently.
Speaker 3 (05:11):
And they are facing this.
Speaker 4 (05:14):
Well, this problem with risk of higher inflation, and they've
been dealing with that problem of higher inflation since twenty
twenty two, never quite getting back to their two percent target.
With a new chair coming in, I guess I have
a multitude of questions here. I mean, one of which
is how high do oil prices need to get before
you start being more worried about a growth problem in
(05:35):
the US than you do an inflation problem. But two,
and this is the bigger one. Kevin worsh has pretty
clearly wanted to be on a path of lowering interest rates.
The Fed never has gotten back to their two percent target.
They keep saying that they have a target. Is it
even still meaningful anymore to have a two percent inflation
target at this point given they don't seem fundamentally serious
(05:57):
about getting.
Speaker 3 (05:58):
Back to it.
Speaker 2 (05:58):
Here's the thing I don't think I agree with you.
You can't kill the two percent inflation target before you
get there though I.
Speaker 4 (06:07):
Think you shouldn't, but I have no evidence that Kevin
Worsh is going to follow your thinking on that.
Speaker 2 (06:13):
It's one where And look, here's ultimately how this ends
up working is if with anyone to talk to anyone
who has lived in Brazil, talk to anyone who's lived
in Argentina, talk to anyone wh's lived in South Africa, Turkey,
places that have dealt with monetary messiness, policy procedure that
(06:34):
has gone awry. What they'll tell you is, look, ultimately,
if the central bank decides to start cutting or changing
policy more dubbishly while things are still too hot, it
has the opposite effect that you intend yeh, because it's
basically saying, Okay, we're gonna run the economy hot, and
the long end of the yield curve ten year bonds,
thirty year bonds, they blow out top side because the
(06:55):
bond markets is fine. You're not serious about this great,
We don't want to own the long term bonds. Because
if you think of it this way, if you buy
a long term bond in the US right now, a
thirty year treasury, the US government gives you five percent
a year for the next thirty years and you say,
remember the people who buy those and just hold them.
(07:15):
It's mostly insurance companies and things like that.
Speaker 3 (07:18):
Big institutions, not just insurance companies.
Speaker 2 (07:20):
But yeah, yeah, like pension plans, like there aren't very
many individuals who just are scouring, you know, the brokerage
sites for like, hey, what's the best thirty.
Speaker 3 (07:30):
Year treasury bond? And it's just not how it works.
Speaker 2 (07:34):
So you've got these liabilities that you're pricing out thirty
years into the future, and as an insurer, you're saying, Okay,
here's what inflation's gonna be, here's you know, the policies
that I have, Here's what I need to hedge for.
If the central bank says, hey, we don't care about
inflation in the short term, you, as that buyer, immediately say, well,
(07:55):
I got to get paid something else otherwise I might
be underwater in thirty years. And so yeah, five isn't
gonna cut it. You gotta pay me five and a
half yep in order to compensate me properly for that risk.
And so this is the thing where ultimately, I here's
the thing about you know, everyone's really skeptical that warsh
(08:15):
is going to do a good job. And I'm not everyone,
but like you're getting this church back that he's going
to be just a totally a flunky, a lackey, Like
there's all kinds of words that we can use for
the Trump administration. He may be, he may not. I
don't know, because he hasn't done anything yet. What I
do know is that Scott Bessen, in the year leading
up to him being appointed Treasury Secretary, talked all about, hey,
(08:38):
Janet Yelling's selling this mix of bonds, like how could
she do this?
Speaker 3 (08:42):
Blah blah blah. It's wrong.
Speaker 4 (08:44):
It's very critical of the members of the Bid administration
in order to get considered for the job of Treasury secretary.
Speaker 2 (08:50):
And Besson took the job and basically hasn't made a
shift in terms of bond isshuins from what Yellen was doing.
It's the exact same or within sniffing distance of it.
So part of this, I'm a big believer that, hey,
a lot of people, you know, when you're camp paigning
for any job, A lot of people and I'm not
saying this is right, but a lot of people today
like you say what you need to do in order
(09:11):
to get the job, and when you then get into
the seat, especially a seat like you know, chair of
the Federal Reserve. You understand the gravity of the situation.
And just like Scott bessen didn't just upend the entire
model of Hey, here's the issuance that we're gonna do
for US Treasury bonds. I suspect that Kevin warsh is
(09:32):
not going to want his legacy to be the dude
that you know, brought on the second peak in inflation
in the twenty twenties.
Speaker 3 (09:40):
I tend to agree one caveat that I'll throw out here.
Speaker 4 (09:44):
Uh, President Trump was not criticizing the intricacies of bond
issuance by the Biden administration, or at least not heavily.
H He has been for the last several years criticizing
the Federal Reserve directly and calling specific for lower interest rates.
And I view those two as different, Right, Scott Bessont
found something to criticize about the bid administration that he
(10:07):
took issue with.
Speaker 3 (10:08):
Here.
Speaker 4 (10:09):
Kevin Walsh has you know, stated publicly that he is
in agreement with the President about where interest rates should go.
And the President has been much more public about that
criticism than what best and flatched onto.
Speaker 3 (10:21):
So again fair, you know, we will have to wait
and see. I am with you.
Speaker 4 (10:27):
Judge people by their actions, not by their words, and
Worsh has not had time to take any actions to
this point. But I do very much fear the move
away from a two percent inflation target because already as
it is, when I ask people, I'm not talking about
trained economists. I'm talking about retirees and the general public
(10:50):
that I speak to. And I asked them, hey, you know,
if you had to bet, will inflation be hotter.
Speaker 3 (10:54):
Than the last decade or cooler than the last decade?
Speaker 4 (10:57):
The answer is almost universally hotter now probably not actually
thinking about the measurement of the last decade includes twenty
twenty two when we saw nine percent inflation. But when
you ask that question, it's hotter. I think inflation expectations
are substantially hotter than they were for the last decade,
and that can be a problem for the FED.
Speaker 2 (11:17):
Let's take a quick break. When we come back. I
got a couple of housing pieces I want to cover.
We've also got trivia next.
Speaker 1 (11:24):
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(11:45):
Financial Exchange Radio Network.
Speaker 5 (11:49):
Time for trivia here on the Financial Exchange. On this day,
in nineteen seventy nine, the United Kingdom elected their first
ever female prime minister. She would go on to serve
three consecutive terms, becoming the longest serving prime minister in
the UK for the twentieth century. So our trivia question
today is simply who was the UK's first female prime Minister?
(12:15):
Once again? Who is the UK's first female prime Minister?
Be the second person today to text us at six
one seven three six two thirteen eighty five with the
correct answer along with keyword trivia. And when a Financial
Exchange Show t shirt once again the second correct response
to Texas to the number six one seven three six
(12:36):
two thirteen eighty five with correct answer along with keyword trivia,
We'll win that T shirt. See complete contest rules at
Financial Exchange Show dot com.
Speaker 3 (12:45):
A little bit of news here from the UAE.
Speaker 2 (12:49):
The UAE Ministry of Defense has now confirmed that they
detected four cruise missiles launched them from Iran and the
sounds heard by residents, three out of the four being intercepted,
while another one splashed down off the coast. This is
in turn, probably what's pressuring stocks to the tune of
about a half percent fall in the last five or
(13:09):
ten minutes.
Speaker 3 (13:10):
Now.
Speaker 4 (13:10):
Sorry to be clear, this was not a strike on
in a UAE flight vessel. This was a strike on
the United Air Emirates. It's untempted strike.
Speaker 2 (13:18):
It's unclear exactly where these were intercepted and what the
targets are. We don't know specifically, but it does appear
that they were heading towards the UAE the country, not
necessarily vessels.
Speaker 4 (13:32):
And I did say that they had put residents under
you know, strike warnings, so.
Speaker 2 (13:37):
That they did that earlier today, but that turned out
to not be a an actual attack. In this case,
it does appear that the UAE has confirmed that missiles
were fired at them from Iran.
Speaker 3 (13:52):
It's felt for the last.
Speaker 2 (13:53):
Week or so that the UA and Iran are not
in a good spot right now, is a nice.
Speaker 3 (13:59):
Way of putting it.
Speaker 2 (14:00):
Even if everything goes well and improves here over the
coming months. It would not surprise me if the two
of them have their own little affair over the next
few years, just because there's no love loss between the.
Speaker 3 (14:14):
Two of them.
Speaker 2 (14:14):
Right now, let's talk a little bit about housing again.
What will update you as we know more, but just
again something relevant and market moving there. First from the
Wall Street Journal, high housing costs are pushing foreclosures to
a six year high. Homes with foreclosure filings twenty six
percent in the first quarter.
Speaker 3 (14:34):
Here's the thing.
Speaker 2 (14:35):
Housing foreclosures are not a problem for the broad US
economy because they are coming off such a low level
that this is not something that is problematic in any way.
Speaker 3 (14:46):
Shape or form.
Speaker 2 (14:47):
It's not to say that certain families aren't having trouble
paying these higher housing costs. I understand that it's tough
for you know, families that are out there dealing with these,
but when we talk about foreclosures becoming a problem, it's
not something that has impacting the US economy in any way,
shape or formulat.
Speaker 4 (15:02):
So the last quarter that the Saint Louis FED has
data on was the fourth quarter, so we'll get an
update soon on this. But the rate of delinquency on
single family residential mortgages was one point seven to eight
percent in that fourth quarter if it hit. It was
about the same in the first quarter of last year.
So a twenty five percent jump on that right might
bring you to the low twos. We did not get
(15:25):
below two point three four percent delinquency rate on mortgages
at any point during the twenty ten decade. Yes, so
if we start pushing delinquency rates over three percent, we've
got a problem.
Speaker 3 (15:39):
They like, again, not a problem for the you.
Speaker 4 (15:43):
Know, the state of banks or anything like that in
my view, but you know that that is a meaningful
problem because we didn't really spend much time above three
percent anytime other than the Great Financial Crisis. But we
are not in problem territory with mortgages. So one don't
plan on getting a whole bunch of deals on foreclosed
homes and to don't worry about this in the context
(16:04):
the greater economy.
Speaker 3 (16:05):
No, I would agree.
Speaker 2 (16:07):
Another piece here that I do think is interesting for
a broader discussion. Taxes on second homes are springing up
across America, and so you've got different local governments that
are coming out and saying, hey, if you have homes
that are not primary residences. I don't speak French. What
(16:31):
does that even mean in French? I don't speak French.
Ped p I E d ar t e r r
e I. I don't know what it means in French.
Seem to be I'm guessing terror is something about like
land or earth, and ped is probably like usually that's
like foot in the Romance languages, so like foot of
the earth.
Speaker 5 (16:51):
I don't know, smaller second home or studio, foot.
Speaker 4 (16:56):
And mouths, foot to the earth, foot to earth or
foot on the ground. Okay, it's the literal translation, but
it refers to yes, an apartment in New York City
pretty much.
Speaker 3 (17:04):
Okay, so yeah, so you've got you got New York City.
Speaker 2 (17:09):
New York City is planning on taxing an additional property
tax for second homes worth five million or more.
Speaker 4 (17:17):
Rhode Island is considering a Taylor Swift tax on homes
over one million dollars, and New Hampshire recently voted down,
but it did make it to a vote a tax
on second homes worth over half a million dollars. So
many different places are testing this stuff out.
Speaker 3 (17:32):
Guys, this is dumb.
Speaker 2 (17:36):
If you think housing is too expensive for the people
in your jurisdiction to buy it, build more. That's the
like again, if you want to tax it. Finally, here's
the impact that it'll have. It will make that house
more affordable because in order for people to be able
to buy it and pay the taxes, the headline price
will have to come down. Yeah, like that, that is
(17:57):
something that will happen.
Speaker 4 (17:59):
So, Chuck, you owned home in Summerville. Yes, and this
is exactly like. This is not a new idea. I
owned one too in Summerville. You got around a thirty
percent property tax discount.
Speaker 2 (18:10):
It was a flat value. It was a two hundred
and fifty thousand abatement on the valuation.
Speaker 3 (18:14):
Was it. Yeah, I don't recall it.
Speaker 4 (18:16):
But anyway, for living in your home in Somerville, for
being for making that your primary residence, you got, you
know what, worked out to be a pretty substantial property
tax cut for doing so. So plenty of places have
tested this out. That would be another way of getting
at the exact same thing, you know, saying, hey, primary residences,
you do this. You know New York is calling it
your second home tax. It's not a new concept to
(18:38):
build more houses, but it's not going to fix the
housing problem.
Speaker 2 (18:40):
Build you want cheaper housing, build more housing. You want
evidence of this, look at Austin, Texas during the big
you know twenty twenty one twenty two relocation frenzy. Austin
Texas said, well, it didn't say it because the city
can't speak, but the people in Austin, Texas said, hey,
we got to build way more housing, and they did,
and rents have been falling ever since because oh gee,
(19:04):
when you actually supply the needed housing on the market,
rents end up falling.
Speaker 3 (19:08):
I don't one difference here.
Speaker 4 (19:10):
I don't see this as a proposal to make housing
more affordable.
Speaker 3 (19:14):
Which is why it's well, no, I think it's mainly
this will No.
Speaker 4 (19:17):
I think it's mainly a hey that we want to
tax the rich and we need to, you know, figure
out how to do that, and so this is our
way of doing that, rather than hey, this is going.
Speaker 3 (19:25):
To solve our housing affordability problems. Take a quick break.
I want to discuss this more when we return.
Speaker 1 (19:40):
Bringing the latest financial news straight to your radio every day,
it's the Financial Exchange on the Financial Exchange Radio Network.
Tell you out whoa street watch treking, the stocks, the
data and the headlines driving markets so far today right
here on the financial.
Speaker 5 (19:58):
Exchange turned lower, with oil prices jumping higher as a
result of increased military tensions with the strata for moves,
specifically with the developing situation involving.
Speaker 3 (20:12):
Iran and the UAE.
Speaker 5 (20:13):
More than that coming up here right now, the Dow
is down eight tenths of a percent or four one
hundred and one points, SMP five hundred down over a
third of a percent, NASDAC down about a third of
a percent as well. Russell two thousand is up about
a tenth of percent, and Your Treasure reeled up five
basis points at four point four to three six percent,
and oil jumping nearly four percent higher training at one
(20:36):
hundred and five dollars a barrel. Aside from around the
big development over the weekend came from game Stop after
CEO Ryan Cohen made an unsolicited offer to buy eBay
for about fifty six billion dollars. Cohen told The Wall
Street Journal that putting his video game retailer and eBay
under one roof could create opportunities to cut costs and
(20:58):
improve earnings. eBay up by four percent while game Stop
is down by about six percent. Me Myles shares in
Norwegian Cruise Line dropping eight percent after the company cut
its outlook, citing higher fuel prices and also said consumers
are rethinking travel plans. Elsewhere, Tyson Food posted better than
expected quarterly results but said soaring cattle prices weight on
(21:19):
its results. And after today's closing bell, we'll see earnings
from Paramount Sky Dance and Pallenteer. I'm Tucker Silvan. That
is Wall Street Watch. On the previous segment, we asked
you the trivia question, who is the UK's first female
prime Minister? That would be Margaret Thatcher in Our winner
today was George from Wall Fame ass taking on the
Financial Exchange Show T shirt. Congrats to George and we
(21:40):
play trivia every day here on the Financial Exchange See
complete contest rules at Financial Exchange Show dot com.
Speaker 2 (21:47):
A little bit earlier in the show, we indicated a
confirmation from the UAE Ministry of Defense that air defenses
had been activated as they had four cruise missiles from
Iran that were attacking them and three of the four
had been intercepted the fourth had splashed down in the sea.
(22:09):
A second post from the UAE Ministry of Defense now
that the UAE is engaging with additional missile attacks, including
drones and ballistic missiles and cruise missiles from Iran. Also
indications that oil facilities near the Gulf of Oman port
(22:34):
of fuji Era are now.
Speaker 3 (22:38):
Apparently on fire.
Speaker 2 (22:39):
It doesn't it's not clear if it was from debris
or if something got through.
Speaker 3 (22:45):
But again, you've got.
Speaker 2 (22:46):
A little bit of an escalation that appears to be
happening here, and we'll see where this goes In response,
tucking it at oils up ten year treasury now up
six bases points on the day, and the thirty year
five point three to five point one nine percent, So
the thirty year breaching that five percent level UH for
the first time in a while here, and again everyone's
(23:11):
been pretty itchy in the UH, in the region for the.
Speaker 3 (23:14):
Last couple of weeks.
Speaker 2 (23:16):
We'll see if this is UH, you know, something that
kind of flares out and you know, goes away over
the next twenty four to thirty six hours, or if
this flares up instead UH and becomes UH, you know,
kind of a reignition of the conflict. It's it's again
we're reporting this as we get information coming in. No
(23:37):
one really knows a Ton right now, just because the
fog of war is pretty thick.
Speaker 3 (23:42):
Uh, when we're when we're looking.
Speaker 2 (23:44):
At this, getting back to one final point that I
want to make on the second home, uh changes in
tax rates. You know Miken mentioned, Hey, this doesn't seem
to be about trying to make housing cheaper. It seems
to be about trying to tax the rich to bring
in additional tax revenue. Which also is another thing that
I get at, which is, Okay, ultimately you are trying
(24:07):
to you're trying to deal with these symptoms of a
problem and not the actual cause, and in doing so,
you're being highly inefficient. And look, if the rich people
decide okay, fine, like we're just gonna not go there. Great,
you're not gonna get the tax revenue that you want,
then oh yeah. I was not trying to voice the
abilm that I think it's a good idea to go
(24:29):
and do so. But I think clearly that's been the
push from what we've got the new proposed or did
that pass, the California Wealth tax, no idea. So there's
the California wealth tax, there is the New York City
second home tax, there's the Rhode Island proposal, and I
view again, they're all floated with a lot of different ideas,
(24:52):
but I think the clear trend that I've seen has
been a pivot away from oh yeah, we're trying to
make housing more affordable, which you know Massachusetts is gonna
vote on, for instance, a rent control bill, which is
clearly about trying to do that. We'll have the opposite effect, by.
Speaker 4 (25:05):
The way, versus what I'm seeing here, which is our
budgets are a mess. We need to raise revenue. Let's
go get it from the wealthiest in New York.
Speaker 2 (25:15):
Which will work for like three years until they're like, okay, fine,
we'll move New York. Quite honestly, New York City, you
can pull it off. Yes, there's only one New York City.
Speaker 4 (25:25):
Yeah, and you know the people that own those second
places are like, well I moved to Florida to avoid
all of the income taxes.
Speaker 2 (25:32):
I'll just pay it on the property. Well, there's only
one New York City. If you want what New York
City has to offer, that's it. As someone who's a
proud New Englander, there's a lot of beach out there.
Speaker 3 (25:46):
Okay.
Speaker 2 (25:47):
So if Rhode Island says, okay, we're doing this Okay, fine,
then you're gonna go up to Maine. And then if
Maine decides, okay, we're gonna do this, fine, then you're
gonna go down to Delaware. And if Delaware says it great,
you'll go to Like there's a lot of beach out there,
there's only one New York City.
Speaker 4 (26:03):
Always comes down to how onerous we're talking about. But yeah,
whether it's the Massachusetts Millionaire's tax or any of these
other things, what you're talking about is taxing the super wealthy.
And what the super wealthy have been I won't say
always telling you, but pretty consistently telling you is we
can find other states to live in and not dramatically
reshape our lifestyle. Whether it's Jeff Bezos and you know
(26:25):
relocation of.
Speaker 3 (26:28):
All these days.
Speaker 4 (26:29):
I think Florida, but you know he had his headquarters
in Washington State and relocated. Or who's the Google founder
who's been making a big thing out of the California
wealth tex I don't know, he wasn't the founder. In
either case, many of them are saying, look, I'll just
move to Texas. I'll move somewhere else and I might
(26:50):
keep a property there and you can tax that all
you want, but I'm not going to succumb to these things.
And yeah, it's it's not working great and even the
biggest geographic states, and I worry about what it would
mean for some of the smaller ones like Rhode Island.
Speaker 3 (27:03):
Larry Page might have been Brent. It was Brent. That
a big thing of it.
Speaker 2 (27:09):
Sorry, isn't it great that one of the founders of
Google had the last name Page.
Speaker 1 (27:14):
M M.
Speaker 2 (27:15):
You know that's like if that's like if Ford had
been founded by like Jimmy Engine.
Speaker 3 (27:20):
Folks.
Speaker 4 (27:21):
Brand new guide from the Armstrong Advisor Group for the
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(27:44):
If you have a loved one, for instance, who's got
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You've played this out yourself before, and it can be
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If you you have job hopped, and maybe you've got
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(28:06):
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Speaker 3 (28:16):
Now imagine for a moment that you.
Speaker 4 (28:18):
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there are a lot of third rails and things that
(28:40):
can happen if you do it incorrectly.
Speaker 3 (28:42):
Right.
Speaker 4 (28:43):
If you take a distribution out of your retirement account
and don't do it right, you could owe taxes. You
could give up on a bunch of advantages that the
IRS gives you by keeping that retirement account where it is.
Speaker 3 (28:53):
So you have to be knowledge about it.
Speaker 4 (28:55):
You have to understand what the upsides are and the
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Speaker 1 (29:21):
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Speaker 2 (29:37):
Let's see what do we want to cover here? Five
money lessons from readers in the trenches of elder parent care.
This piece from the New York Times.
Speaker 3 (29:45):
Mike, Yeah, so.
Speaker 4 (29:46):
Last year, about eleven four hundred Americans turned sixty five
on any given day.
Speaker 3 (29:53):
It's a lot.
Speaker 4 (29:56):
Gen xers are starting to experience this firsthand. Yeah, Millennials
will be the next to start dealing with their parents,
you know, getting to retirement or already there and running
into all sorts of complicated issues. I think a few
things that I will just generally say, having worked with
(30:16):
that generation and older generations for over a decade now, One,
your parents are generally.
Speaker 3 (30:23):
Not prepared for future health issues.
Speaker 4 (30:26):
No, financially and just emotionally, they are not quite facing
those things very.
Speaker 3 (30:33):
Transparently or clearly. Two.
Speaker 4 (30:37):
Long term care, it's not going to get cheaper in
their lifetimes. It's not going to get more affordable in
their lifetimes. Generally you could see improvements, you know, thirty
forty years from now, but in their lifetime, I do
not believe long term care is going to get cheaper.
And Three, based on my experience, you probably don't know
what they would want for their long term care scenario
(30:58):
if you needed to navigate. Those have been my conclusions,
again from act asking people about this quite a bit
over the last ten years.
Speaker 3 (31:06):
Is nobody likes to talk about it.
Speaker 4 (31:08):
Everybody's unprepared for it, and when it happens, it's oftentimes
in unmitigated mess or disaster where the rest of the
family is trying to pick it up. And the New
York Times article, you know, goes and interviews several different families,
all of whom are having either good or bad experiences
with it, but several of them are kids trying to
figure this out from across the country, oftentimes financially contributing
(31:31):
to their parents' long term care because no conversations were had,
no real planning.
Speaker 3 (31:37):
Was done, And it's a.
Speaker 4 (31:42):
It's been an issue for generations, but because the size
of the baby boomer generation, it's about to impact a
lot more people.
Speaker 2 (31:49):
Yeah, it's something where until you live that experience day
in and day out, nothing prepared like, you can't prepare
for it.
Speaker 3 (32:00):
Honestly, you can try, but until.
Speaker 2 (32:03):
You experience it's it's too theoretical for you.
Speaker 4 (32:07):
The only the only suggestion I have for the gen
xers out there who are getting ready for it is
ask a lot of questions. Ask them of your parents'
financial advisor, ask them of your parents yourself if they
will give you the information, but ask about what the
plan is because, like I said, the vast majority of
people unprepared for it. And two stats that I think
most people don't understand. Average life expectancy is not relevant
(32:28):
when you're talking about living people in their sixties. No,
the life expectancy for a sixty five year old woman
is eighty seven years old. For a man it's eighty four.
And the chances that a sixty five year old woman
reaches age ninety is now forty percent. It's thirty percent
for men. We're talking about a lot of people that
live to ninety to one hundred years old over the
(32:49):
course of the next twenty years, and their financial situations
are not prepared for that reality.
Speaker 3 (32:55):
To take a quick break, when we return, we've got
stack Roulette.
Speaker 1 (33:00):
From markets to money to business and financial news. Watch
The Financial Exchange every day on YouTube. Hit that subscribe
button and keep up to date on the market news
you need to know. This is the Financial Exchange. The
Financial Exchange is life on Series XM's Business radio channel
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(33:21):
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one thirty two. This is the Financial Exchange Radio Network.
Speaker 5 (33:42):
The Financial Exchange is a proud partner of the Disabled
American Veterans Department of Massachusetts. Registered today for this year's
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(34:05):
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dot Boston.
Speaker 3 (34:19):
Mike, what do you got for stack Roulette? For me?
Speaker 4 (34:22):
Let's talk a little bit about gambling sites that are
continue to disguise themselves as futures commodities traders. So Polymarket
and Calci are the two big ones out there, but
they have mirrored the growth that you have seen on
online sports gambling. And the Wallstreet Journal had a pretty
interesting piece for those that aren't already very aware of
(34:44):
what's going on there. They interview a John Peterson who's
now in a homeless shelter after, you know, wasn't in
great financial shape before turned two thousand dollars into forty
one thousand dollars before losing it all on one, you know,
as gamblers do one final bet on these platforms, now
living in a homeless shelter, but a few pieces that
(35:05):
they found. The Wall Street Journal did about these sites
that you know, I think are enlightening and interesting and
important to better understand. One, on poly Market, sixty seven
percent of profits go to just zero point one percent
of accounts, meaning less than two thousand accounts total net
a total of nearly half.
Speaker 3 (35:25):
A billion dollars.
Speaker 4 (35:28):
They also, again, what I think is most important here
is they are not regulated like gambling sites. In fact,
recently Polymarket was running a pay my rent advertisement where oh,
you know, basically like, hey, no longer have the money
to pay your rent, maybe you can make some on
poly market to be able to afford that, to which
I ask, would any state in the country allow a casino?
(35:51):
Can you imagine the Mohegan Sun running an advertisement like, hey,
running out of money to pay your rent, come on down,
maybe you can make it up on.
Speaker 3 (35:59):
Craps, because that's what this is.
Speaker 4 (36:02):
Yes, And my concern is that, hey, it's not regulated
anywhere like it. By the way, they don't run that
ad anymore, but they but they did, and two more
and more, it seems to me that these what are
very clearly akin to gambling platforms are being advertised as
(36:23):
one legal gambling and two investing in some way, and
they are neither correct, and that I think in lies
the problem. And I do worry about you know, Robin
Hood and others who are beginning to place these platforms
on their brokerage websites really muddying the waters even further
(36:43):
between what is gambling and what is investing.
Speaker 3 (36:45):
I've kind of had it with them at this point. Yeah,
you know, like, yeah.
Speaker 2 (36:51):
People, everyone is out there is like, oh, well, it's great.
You can now if you like have an idea, you
can put your money where you're mouth is. Maybe I
don't want to. Maybe I just want to have a
conversation about something. I don't need to bet on everything.
Speaker 4 (37:05):
And it is so pervasive. I was talking to I
was at a reunion over the weekend and it was
you know, classes from several different age groups, and yeah,
of course all of the recent college grads were talking
about all of their bets on the basketball game and
like every playoff game out there, and all the money
that they were losing.
Speaker 3 (37:25):
And it's which is such.
Speaker 4 (37:27):
A part of the lifestyle that is just not for
all of the people that were in my age EMO, and.
Speaker 2 (37:31):
Quite honestly, it's a boring part of the lifestyle. I'll
pass judgment as someone who you know does actually go
to casinos and gamble. I know that no one wants
to hear about the bad beats that I got on
a back jackhand.
Speaker 3 (37:46):
Right because it's not interesting. It's not interesting. I'd rather
hear about your dream, So like, stop.
Speaker 2 (37:52):
Telling me about well, I bet on this, and this
is how we're I don't care. Like if the most
interesting thing that happened to you today is that you
like put a bet on how many points Larry Bird
would score whatever, the answer was zero.
Speaker 3 (38:11):
He didn't score any yesterday.
Speaker 2 (38:13):
We're gonna take a quick break for the rest of
the day and we'll be back tomorrow. And if you
didn't like our show today, we're gonna try harder, we promise.
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