September 18, 2025 • 38 mins
Chuck Zodda and Mike Armstrong discuss the recent $5B investment by Nvidia into Intel. Chuck wonders how long till Nvidia just buys up Intel altogether. Huawei unveils AI chip roadmap to challenge Nvidia's lead. Congress has no good excuse to keep trading stocks. Start practicing retirement now. It'll make the switch that much easier. Home Insurance as you know it is doomed. You're not ready.
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Episode Transcript
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Speaker 1 (00:00):
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(00:20):
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Armstrong and Money Matters Radio do not compensate each other
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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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Speaker 2 (00:55):
Help us support our.
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Great American heroes by visiting dav five K DOC Boston
and making a donation today. This is the Financial Exchange
with Chuck Zadath and Mike Armstrow, Chuck.
Speaker 2 (01:10):
Mike Kentucker with you here. Day after the FED meeting
in which the Federal Reserve cut the short term FED
funds rate by a quarter percent, we've got a broad
rally taking place in equity markets. All three major US
indices are in the green. The Dow Jones Industrial Average
up one hundred and one points about a quarter percent,
SP five hundred about thirty seven points or half a percent,
(01:33):
and the Nasdaq is currently up two hundred and forty
points about one percent. So remind me if you've heard
this story before. Tech is kind of leading the way
for the stock market, and thank you for you know,
your time and attention. It's just it's it's what we're
seeing with this market. It just continues to be a
tech driven market right now today, coming out of the
(01:56):
semiconductor space, which was not in a good spot yesterday
on some negative news for Nvidia. But we've got some
other Invidia related news that we're gonna get to in
just a second once we finished going through markets. Ten
year treasury selling off very modestly, up four point six
basis points to four point one to two percent. We've
got oil today, let's see oil's basically flat, up twelve
(02:19):
cents a barrel on West Texas Intermediate to sixty four seventeen.
And we've got gold today selling off on some renewed
dollar strength. This has gold currently down forty four to
thirty and ounce to thirty six seventy three and fifty cents.
Gold obviously has been on a tear the last few weeks,
so little consolidation not entirely unexpected, and we'll see where
(02:44):
it goes from here. Also one other interesting data point,
Mike on the the weekly jobless claim stuff. Please, so
the initial claims came in back in line with where
you want to see. They dropped from two hundred and
sixty four thousand to two hundred and thirty as we
kind of suspected they would come down because of a
couple reporting anomalies last week. We've got a new reporting
(03:07):
anomaly this week, though, Michael, oh good, it's not on
the initial claim side, it's on the continuing claim side.
And we're gonna hop on the old covered wagon and
travel down to North Carolina. I don't know why you
do that. It's more kind of going out.
Speaker 3 (03:21):
West that's pretty directly south.
Speaker 2 (03:23):
Yeah, well, we can hop on, you know, a nice
little plane and head down to North Carolina. How's that
seem more twenty first century? Thank you? That does seem better.
If we were going to Oregon, we would hop in
the covered wagon. Yeah, correct, Yeah, no, we can't agree there.
So North Carolina last week they reported twenty thousand, five
hundred and thirty five continuing unemployment claims. This week, two hundred.
Speaker 3 (03:47):
And five seems off.
Speaker 2 (03:49):
The lowest they've ever had prior to this was around
twelve thousand, so it's pretty unlikely that they have just
two hundred people on continuing claims. So the continuing claims
data for next week is likely to be revised up
pretty significantly, just because I don't think North Carolinas suddenly
had ninety nine percent of the people on unemployment go
(04:11):
off unemployment. It's never happened before in a single week.
Speaker 3 (04:16):
So does that look at this stuff before that?
Speaker 2 (04:19):
No idea. Do you think someone from the BLS would
just call North Carolina like whoever you know set this
in and be like George, Billy, Billy, did your claims
really decrease by ninety nine percent this week? Oh? No,
they did it? Okay, y, why don't you send us
your new claims then and we'll get this processed. You know,
it just seems to me like maybe there should be
(04:40):
a little communication there. Yeah, but hey, who, I don't
I to say that, maybe you know, you would give
it a critical eye and be like, maybe that didn't happen.
Let's talk about something that did happen though. Uh, Intel
is getting five billion dollars from in Video. I'll quote
here from Bloomberg and Video agreed to invest five billion
in Intel Corporation, and so the two will co develop
(05:02):
chips for PCs and data Center's a surprise move to
help prop up an ailing arts rival that sent Intel
shares soaring.
Speaker 3 (05:09):
What do you think, Chuck, vote of confidence or tagging
along with the US government here? Remember that the US
government just made an investment in Intel, what a month
and a half ago?
Speaker 2 (05:19):
Can it be both? Yeah?
Speaker 3 (05:22):
You know, I don't know that I would represent a
whole bunch of confidence out of this investment, though it seems.
Speaker 2 (05:28):
I don't know.
Speaker 3 (05:29):
It's hard to read into it. I suppose you don't
just throw money away. But if you're looking to get
on the government's good side, I can see why you
might want to do this as in video.
Speaker 2 (05:39):
Well, here's the thing. In video. It's pretty clear to
me that in Video CEO Jensen Wang as a pretty
close relationship with President Trump. Seems like it they've been
in pretty close contact since late spring, and so I
think that there's a pretty close relationship there. It's hard
for me to imagine a that this deal doesn't happen.
(06:00):
That's some communication with the executive branch. But b it's
also clear to me that in Vidio doesn't just throw
five billion dollars around for no reason. You know, they
must think there's something there that they can get as well. Now,
exactly how this is going to take shape is still
an open question because basically what's being outlined here and
(06:23):
Video's gonna buy shares an Intel stock in order to
you know, process the investment, and Intel will then use
in Video's graphics technology and up upcoming PC chips and
also provide its processors for data centers built around in
video hardware. I don't know why that is a market, Like,
is anyone building data centers right now being like, hey,
(06:45):
this would be much better if we bought some Intel
chips to It would seem to me if they thought
that they would already be doing it. They didn't offer
a timeline for when these first parts would go on sale,
and says that the announcement doesn't affect their individual future plans.
So I'll tell you the place that my head did
go to immediately after seeing this. How long do you
(07:08):
think it is until Nvidia buys out Intel entirely?
Speaker 3 (07:16):
I don't, okay, So, I mean it's only one hundred
and forty six billion dollar company now, even with the
giant jump that they've seen, the stock is up by
fifty six percent right now. Yes, I take your point,
But does anyone does in video really want to manufacture chips?
This is exactly how Intel got to where they are
in the first place.
Speaker 2 (07:37):
Here's just hear me out on this. Because my wheels
got turning as soon as I saw this. I'm like, okay,
Like in Video is gonna want the whole thing at
some point. This is like an entry into where they're going.
If in Video were able to make their own chips,
they need a couple things. There's a couple of things
that need to happen. Obviously. The first is they need
(07:59):
someone with know how to make chips. Intel for all
of its flaws and foibles and this, and that they
can make chips, they might not be the best ones
right now, SIPs.
Speaker 3 (08:09):
They can technically do so, but have failed to make
anything that people want to buy for the lays and
grace technology now for the better part of a decade
a while.
Speaker 2 (08:18):
But maybe this partnership starts to get them on track
in terms of just you know, hey, here's what we're
trying to design. Can you help us, you know, with
manufacturing this and that? I don't know. The other piece is,
if there's one major risk that Nvidia has right now,
it's they are dependent on one supplier, Taiwan Semiconductor, who
(08:39):
the stuff that they're buying from them is manufactured entirely
outside of the United States in Taiwan, in an area
that's directly threatened by the Chinese government.
Speaker 3 (08:50):
All true.
Speaker 2 (08:52):
So if one is nervous about China doing two things,
a kind of crack down on anything semiconductor related that's
being purchased from the US, which it seems like they're
starting to, and be the potential for any Chinese military
action towards Taiwan. If you can have facilities in the
(09:13):
United States that can make your chips it's if you're
a five trillion dollar company or a four trillion dollar company.
Speaker 3 (09:21):
Nice to have an insurance policy.
Speaker 2 (09:22):
One hundred billion dollar insurance policy for having some production
capacity out of the US might be worth it.
Speaker 3 (09:29):
All agreed, But I am also no semiconductor manufacturing expert.
Let's see this thing front of it. So are you
a decade before they have that capability?
Speaker 2 (09:40):
More? Like, I genuinely don't know if you start telling
me it's a day less than a decade?
Speaker 3 (09:45):
Yeah, yeah, you.
Speaker 2 (09:47):
Know, like it's it's every day counts. Is I guess
the point that I'm making And I don't know. I
I just think there's some like that, there's something there
in my my opinion, and I just wonder if if
in Nvidia is seeing the same thing. I don't know. Yeah,
(10:08):
I'm just it's probably easier and cheaper to do it
this way than for Nvidia to start from scratch on
their own, I guess, is what I'm getting at.
Speaker 3 (10:16):
Yeah, I'm not sure if that means they need to
own Intel, but we'll see.
Speaker 2 (10:22):
I don't know. This could be one that's like completely
off the board, Tucker, can you put this on the
board for call it? By end? Of twenty seven. Give
me a two year window.
Speaker 4 (10:31):
On this end of twenty seven.
Speaker 2 (10:33):
Yeah, what kind of odds am I getting on that?
Well check predicted. Okay, uh yeah, let's put that on
the board for end of twenty seven. But I don't
know that. Like I saw it, and I'm like, ooh,
this is a first step, like it's it felt that
way to me at least. Yeah.
Speaker 3 (10:51):
I like our way of promoting gambling versus the NFLS
and I don't actually bet any money on it. We
don't actually bet any money on it. And the things
that we bet on only you and I are interested in.
Speaker 2 (11:03):
There's no market for this, Like we'll will in video
bye Intel by the end of twenty seven. Yeah, we've
got one person who's wagering nothing. His name's Chuck.
Speaker 4 (11:12):
Tune in two years.
Speaker 2 (11:13):
Yeah, when we get to the January first, twenty eighth show,
it's gonna be straight fire. Let's take a quick break here.
When we come back, we'll do a little bit of trivia.
Do we want to talk Huawei, Michael, Yeah, we do. Okay,
let's do a little bit of Huawei when we return.
Speaker 1 (11:33):
Find daily interviews and full shows of the Financial Exchange
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(11:56):
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Radio Network.
Speaker 4 (12:09):
This segment of The Financial Exchange is brought to you
by the US Virgin Islands Department of Tourism. Looking for
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Speaker 2 (12:46):
Time for trivia.
Speaker 4 (12:47):
You're in the Financial Exchange, and today is Lance Armstrong's
fifty fourth birthday. Armstrong gained fame for his performances at
the Tour de France after beating cancer trivia question today,
how many Tour de France titles does Lance Armstrong currently have?
Once again, how many Tour de France titles does Lance
(13:08):
Armstrong currently have? H Be the first person today to
text us at six one seven three six two thirteen
eighty five with the correct answer, and you win a
Financial Exchange showed t shirt. Once again, the first correct
response to text us to the number six one seven
three six to two thirteen eighty five will win that
T shirt. See complete contest rules at Financial exchine show
(13:31):
dot com.
Speaker 3 (13:32):
Tour de France. Yeah, Tour de France.
Speaker 2 (13:36):
Tour de France Listen Armstrong is one of those titles
when I actually watched the thing, you know, I mean,
I like, back then, I thought it was like really cool.
It probably still is, but I gotta admit he was
the only reason that I was watching him back then. Sure,
let's talk a little bit about uh Huawei, so uh
Bloomberg report here, Huawei unveils ai chip roadmap to challenge
(13:57):
in Nvidia's lead. We talked about this little bit yesterday,
so earlier this summer we correctly called it, and we're
proud to toot our own horn on this that, Hey,
the most interesting thing would be the US grants export
licenses to Nvidia to send their chips to China, and
China says we're not interested, which is exactly what they
said yesterday. The thing we then speculated about yesterday is, hey,
(14:21):
what if, you know, China tries to do what they
always try to do, which is, hey, you know what,
let's just make so much of this stuff at such
a cheap cost that we can then sell it everywhere
and put competitors out of business because we can just
do it cheaper than everyone else.
Speaker 3 (14:36):
They've done with solar panels, they're trying to do it
with cars, and this sure is a pretty good roadmap.
Speaker 2 (14:41):
For it, and this year seems like they're trying to
do it now. These are going to be models that
are rolled out in twenty twenty eight, and I'm sorry's
twenty seven and twenty eight, so there's you know, a
year and a half to two years before these are
coming out. But the question that I posed yesterday that
i'll continue to pose today is Okay, you have a
pretty convincing case for me at least that domestically Microsoft
(15:04):
and open AI and Meta and Google probably not going
to be interested in these chips. Is that a fair assessment, Mic?
I think so. In Europe, I think it's going to
be more of a question. But Europe is successfully fended
off Huawei inside of telecom systems previously, and so I
think that they could do so here, even though their
(15:26):
track record is bad at best. Just look at you know,
Chinese evs overrunning European manufacturers right now. Right The one
that really interests me is what happens with the you know,
the Gulf States and and and basically any OPEC country
that has committed to buy a lot of Nvidia chips
right now, because it's pretty clear to me that the
(15:49):
trade that you know, these countries see if you're you know,
the UAE, just as an example, you say, okay, we'll
buy you know, all this stuff instead up a big
data center here and we can run it in. That'll
be great in and of itself, but obviously they also
want you know, defense contracts and things like that. They
want US weapons clearly, like we've seen how the deals
(16:10):
have unfolded so the question for me is if China
were to go to the UAE and you know who,
like whoever they want to go to and say, hey, look,
I know you're supposed to buy you know, X billion
dollars of in Nvidia chips. We'll give you the same
performance at twenty percent of the cost, and we'll buy
(16:32):
even more oil from you, because the US can't commit
to buying more oil right now, Like the US is
like we're you know, we're not buying more. We're not
the future customer for the Gulf States. And so I
think that's the interesting thing that I think I'll watch
over the next year or so, is hey, what do
(16:52):
we see in terms of potential chip commitments from those
countries saying yeah, we're okay doing that and being China's
ecosystem on this stuff. I'm just curious to see if
it plays out that way, because this is not a
case where here's the thing, like China can't go to
a lot of other countries. There aren't many countries that
actually have enough money to buy these and like sizeable
(17:15):
quantities like you can't go to It's not gonna be
like the Belton Road initiative. China can't go to Cameroon
and be like, hey, do you want to buy billions
of dollars of our chips, because Cameroon's gonna be like,
what do we use these for? Here? Yeah, it's like
we're not gonna be a big data center hub. Like,
it's just not what we're set up to do.
Speaker 3 (17:32):
Europe Middle East. So the question then about these I
think clearly China probably has the capability to manufacture a
ton of them. The questions aren't they any good?
Speaker 2 (17:46):
Right?
Speaker 3 (17:47):
Because like the entire theory that we've been running on
here Chuck is, yeah, maybe they will just produce chips
that aren't that good. But because they have such incredible
power generation capability in China, then it won't matter because
they can they can just build more and more of them,
and they'll be able to get around the fact that
they're not terribly efficient. That's not the case in Germany,
(18:07):
it's not the case in Spain. If you want to
start up a data center in Spain and run your
AI models on Chinese chips, good luck finding the power,
good luck finding electricity for it. And so that's the
question is are they good enough to sell to customers
outside of China, where yeah, you can just you know,
wipe out an entire city and put up a nuclear
power plant, because who's going to question you?
Speaker 2 (18:29):
Piece from Bloomberg, opinion from the full editorial board. Congress
has no good excuse to keep trading.
Speaker 3 (18:35):
Stocks, nor have they for the last thirty years, but
hasn't stopped them. No, they once again make a compelling
argument that congress people senators should not be able to
trade stocks, and once again it'll be completely ignored and
they will continue to insider trade without having to call
it insider trading.
Speaker 2 (18:54):
Yeah, it's this should be one of the simplest things
to do. But obviously Congress is kind of failing to
self police on the issue. And that's why you have
two different exchange traded funds that are now tracking the
trades of Nancy Pelosi and Ted Cruz. Yeah, so.
Speaker 3 (19:14):
I guess we'll just continue to tolerate this. We shouldn't.
Everyone should be upset about this, because both Democrats and
Republicans do it over and over again.
Speaker 2 (19:25):
Disgusting. Let's take a quick break here. Stocks remain broadly
positive as we head towards the bottom of the hour.
We got the trivia answer and Wall Street.
Speaker 1 (19:33):
Watch next, bringing the latest financial news straight.
Speaker 2 (19:41):
To your radio.
Speaker 1 (19:42):
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 (19:57):
Markets in rally mode after the FED reduced interest rates
by a quarter of a percent at the conclusion of
their meeting yesterday afternoon. AI and Chip gin Nvidia also
remains in the spotlight with more news around them at
the moment. The Dow is up three tenths of one percent,
or one hundred and fifty four points higher, SMP five
hundred is up seven tenths of one percent or forty
(20:20):
six points, Nasdaq up one point two percent or two
hundred and sixty five points, Russell two thousand up nearly
one and a half percent, Tenure Treas reeled up three
basis points and is now at four point one point
one four percent, and crude oil down seven tens of
one percent, rating its sixty three dollars and sixty one cents.
(20:41):
A barrel of the big tech news on the day
revolves around in Vidia and Intel after in Video said
it would invest five billion dollars in struggling chip maker
Intel to co develop data center and PC products. After
shedding three percent yesterday in video, stock is rebounding three
percent today, while Intel shares are surging twenty eight percent. Meanwhile,
(21:04):
some breaking news this hour we where the FTC and
seven States sued Live Nation and Ticketmaster for failing to
enforce its own purchase limits, which allowed resellers to buy
up large numbers of passes for popular events. Live Nation
shares are down by two percent on that news. Elsewhere
(21:24):
shares and Nova nor Disk jumping six percent after the
drug maker said late stage trial of its once daily
obesity pill showed significant weight reduction in line with its
we Go Vi injectable weight loss drug. PayPal and Alphabet
announced it with team up on online shopping, laying out
plans to combine PayPal's payment infrastructure with the Google's AI expertise.
(21:50):
Both PayPal and Alphabet are up about one percent. Darden
down by seven excuse me, nine percent after the olive
garden owner raised its annual outlook but hosted adjusting earnings
below forecasts. And after today's closing bell, we'll see earnings
from FedEx and Lenar. I'm Tucker Silva and that is
Wall Street Watch. And in the previous segment, we asked
(22:13):
you the trivia question, how many Tour de France titles
does Lance Armstrong currently have? That would be zero, yeah.
Speaker 2 (22:23):
Zero.
Speaker 4 (22:23):
While Armstrong did win seven Tour de France races, he
was stripped of all his titles due to the use
of performance enhancing drugs. Edward from Bill Recer Mass is
our winner today, taking home a Financial Exchange Show t shirt.
Congrats to ed and we play trivia every day here
in the Financial Exchange See complete contest rules at Financial
(22:44):
Exchange Show dot com.
Speaker 3 (22:45):
I feel like our trivia is slowly switching to riddles.
I think it's Tour de France.
Speaker 2 (22:51):
Shut up.
Speaker 3 (22:55):
From Tucker on this one.
Speaker 2 (22:57):
Fantastic, Mike. Do you want to talk about what other
gen zers should include social Security in their retirement planning
or how to start practicing retirement?
Speaker 3 (23:07):
I like the idea of practicing retirement. Can I practice retirement?
Speaker 2 (23:10):
Yeah? Why don't you just go right now?
Speaker 3 (23:11):
Yeah, I'll talk to you guys later. So realistically, no,
really realistically for a moment here, Chuck, have you, I'm
sure you have. I do frequently see people retire and
then just utterly fail at that retirement. It's usually not
because of their overall planning or lack thereof, but I
(23:34):
think people just have this oftentimes wrong view of what
retirement's going to be, Like, how do you see it?
Most often when I see people screw it up? Like,
let me be clear, like eight times out of ten,
I think people do it really well. They you know,
find a lot of enjoyment and retirement. They are doing
(23:56):
things that they didn't have time to do, They're restarting
passions that had previously. But when I see people screwed up,
it's usually because they end a job, either involuntarily or
because they just hated the job, and then they have
no idea what to do with themselves.
Speaker 2 (24:15):
Yeah. Yeah, it's a lot of times, I would say
amost all the time when people talk about planning for retirement,
they're so focused on can I that they don't really
focus on, well, how do I actually do it? And
should I? Yes? And so what does this get at
in terms of the idea of practicing retire Like what
(24:36):
do we mean by practice retirements?
Speaker 3 (24:38):
Well, the case that they lay out, which is a
compelling one, but most employers won't let you do it,
is try and kind of slowly practice your retirement activities
before you get there. Like most of us that are
heading towards retirement don't have young kids at home anymore,
and so hey, I really want to get into I'm
(24:58):
gonna go with the most unique one. I No client
of mine really want to retire and spend more of
his time building bird houses. Love it awesome activity? Uh,
try it out.
Speaker 2 (25:09):
Have you watched Listers? By the way, do.
Speaker 3 (25:11):
It for five hours on a weekend and see if
you actually enjoy it would be the answer. No, I
haven't watched Listers. What's Listers?
Speaker 2 (25:17):
It's a like two hour documentary on these guys who
decided to go on an extreme bird watching tour for
a year. Extreme like doing like nutty things to go
watch birds. Okay, I know you'd be like extreme bird watching.
What's that? If you watch it, you'll get it. And
then they wrote a book basically about all the birds
that they saw, but it's it's a bird watching book
(25:38):
for late people got it so that the reviews that
you see on Amazon are like, not the book I
would pick in order to find birds, but entertaining nonetheless.
Speaker 3 (25:47):
So the you know, awesome result, the result that I've
seen people really get the best out of is when
an employer actually allows you to cut back your hours,
right like, hey, yeah, I'm going to three week and
I'm phasing into retirement.
Speaker 2 (26:02):
Now.
Speaker 3 (26:03):
Again, that's a pretty unique situation. I will fully admit
that most employers aren't terribly okay with it. But like,
you know, if you can drive a compelling argument, hey
I'm going to drop my health insurance and you can
cut my wages, but I want to try out this
retirement thing and go to three days a week, Like
what a perfect solution for figuring out what it is
that you're going to do. So that's the idea of
(26:23):
practicing retirement. And if it doesn't really work in that
specific way, then there's other ways to do it, such
as dedicating you know, I guess the most important thing
is actually having a reason to get up in the
morning and do retirement every day, right, Like, what is
it that I'm going to fill my time with? But
(26:44):
in look to have the luxury of practicing that, to
have the luxury of knowing that, hey, I can step
out and drop my health insurance and move back to
a few days a week, you do have to start
with the financial side of planning for retirement as well,
and if you would like to learn a little bit
more about how Armstrong Advisory Group thinks about those stages
(27:06):
of planning for retirement, we'd encourage you to come to
one of our live seminars happening next month. I've talked
to you a little bit about these before, but it's
gonna be a combination of both a live broadcast of
this show, the Financial Exchange, followed by meet and greet
and seminar with the Armstrong Advisor Group. We're gonna buy
you lunch and meet you at either the Showcase Super
(27:27):
Lucks and Chestnut Hill on October sixteenth or the Margaritaville
Resort on Cape Cod on October ninth, so two separate
events that you can sign up for. Space is always
limited for these folks and we do sell out, so
we need you to call and book your appointment before
you show up. Once again, the first one live broadcast
of The Financial Exchange, followed by lunch with aag October
(27:51):
ninth on the Margaritaville Resort on Cape Cod and then
follow by that we're gonna be doing the Showcase Super
Lucks Chestnut Hill on October sixteenth and sign up at
Armstrong Advisory dot com or by just calling us at
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a really good time. You get to see the actual show,
meet that guy Tucker. Will you be there in person
(28:13):
or do you have to stay here to be determined?
To be determined whether or not you get to meet
Tucker at these events, but we would love to have you.
It's always a really fun time and I think a
lot of people get a lot out of it. So
join us. October ninth, October sixteenth, Armstrong Advisory dot com.
Speaker 1 (28:27):
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Speaker 2 (28:43):
Mike, we got to talk about this home insurance piece. Yeah,
it's title, and this is something we've been harping on
for the last year, and again I still don't think
people are quite prepared for this. And the title says
that home insurance, as you know it is doomed, you're
not ready and I know that that, Mike. How often
do we are we like, you know, doomers on the
show where we're like, the world's gonna end, everything's gonna
(29:05):
be bad.
Speaker 3 (29:05):
Like, no, we don't say that, but we criticize the
articles that do say it.
Speaker 2 (29:10):
This one's underplaying it in my opinion.
Speaker 3 (29:12):
When you have the CEO of the largest reinsurer out there,
reinsurance companies are insurance companies that ensure insurance companies coming
out and saying we are starting to reach the limits
of traditional insurance.
Speaker 2 (29:28):
Yes, that's like, that's a shot across the bow. Correct.
So just as like the data that we have here,
home insurance costs in the United States have risen twenty
percent in the past two years. They're set for another
eight percent gain nationally this year. And when you look
at it, the states that have high home insurance rates,
(29:48):
they are the exact ones that you'd expect Florida, Louisiana, Oklahoma, Colorado, Texas.
They're ones with lots of natural disasters because that's usually
what causes the most widespread damage. It's you know home
you know, fires and things like that. Sure that happens,
but it's kind of predictable. You know, there's a fairly
fixed rate of those across the country. You don't have
hurricanes in Vermont, same way that you don't have you know,
(30:12):
earthquakes in North Carolina that cause you know, any meaningful
widespread damage, So you can kind of predict where the
damage is going to be. So Louisiana as an example,
right now, this year, the average home insurance costs there
is eleven thousand dollars a year. That's expected to rise
by another three thousand this year. So you're talking a
(30:32):
twenty five percent premium bump for Louisiana this year. And
as someone who spent last weekend in Louisiana, I can
tell you it's a really low and flat state and
I understand exactly why this is happening.
Speaker 3 (30:46):
It's also a relatively poor state where people are not
going to be able to ensure these things.
Speaker 2 (30:50):
And this is the problem is what this is going
to mean is that even in a world in which
interest rates may come down, insurance costs, property taxes, and
utilities are going to be a major headwind against the
housing market for the foreseeable future.
Speaker 3 (31:09):
Here's my biggest problem with this overall situation is we
are not doing anything at the state or federal level
to address this head on, and so what everyone should
be listening to and what can you do? I well,
I worry about what will be done, which seems to
be really like, here's how I see this playing out,
(31:31):
Chuck is, more and more insurance companies try to raise prices,
more and more states prevent them from doing so. More
and more states go and set up the Florida and
California model, which is, if your insurance company drops you,
the state will ensure you again. And where I think
we will ultimately lead to is someday one of those
(31:52):
companies will go belly up, and then we at the
federal level, we you know, all taxpayers will have to decide, Okay,
are we bailing out state insurance? Is that made bad decisions?
Speaker 2 (32:01):
Yep?
Speaker 3 (32:02):
That's like I don't have an answer for how you
deal with this at the insurance company level other than
raising premiums.
Speaker 2 (32:08):
I don't think you can stop that.
Speaker 3 (32:10):
What I worry about is that we in Massachusetts, we
in Vermont, in Maine, you know, across the country are
gonna be left hold in the bag for when Florida's
state insure finally goes belly up based on a huge
hurricane sure and that's that's how it involves all of us.
Speaker 2 (32:24):
Yeah, the FARTA insurance market does appear to be stabilized somewhat. Yeah,
and that does.
Speaker 3 (32:29):
Insurances are coming back. They finally got rid of some
of the fraud. They've allowed premium increases. You have people
dropping off the state run insurance. So I'm seeing signs
of encouragement.
Speaker 2 (32:39):
But it's stabilizing at an average cost of like fifteen
fifteen five hundred a year, which is up from you know,
seven thousand a year a few years back. Yeah, so
that like this is unfortunately the stuff that you need
to do in order to stabilize these things is the
insurance costs likely have to go up. I mean Louisiana
just as an example, the average cost of a home
(33:02):
in Louisiana, not that different from the broader US, is
about five hundred thousand for homes that were sold this year.
If you're paying fourteen thousand for insurance, you're talking about
almost three percent of the homes cost in any given
year is going to the insurance policy. And that has
an impact because hey, one thousand dollars a month being
(33:23):
added to your monthly mortgage payment. It's probably increasing your
monthly payment by fifty percent. It's a huge thing that
you got to account for, and it's going to happen
in more and more states because this is this is
a widespread issue that is going to continue to grow.
Quick break here when we come back Stack Roulette.
Speaker 1 (33:41):
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Here The Financial Exchange every day from eleven to noon,
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Speaker 2 (34:19):
What do you got for me? For stock Ruler, Chuck?
Speaker 3 (34:21):
It is h apple picking season and New England has
taken home some accolades for the best orchards and corn
mazes out there. In fact, according to USA Today, they
went and ranked for me the top ten apple orchards
in the country, along with the top ten corn mazes,
which I love a little bit of each of those
this time of year. Number one corn maze up in Maine,
(34:44):
Levant Levint, Maine, Levant, Maine. I don't know how you
pronounce it. Tree Wargi Family Orchards taken home the number
one spot there. The corn maze covers over four acres. Oh,
it's a whale. Yeah it's a whale. And then Baby
Wheel Lineman Orchards in Middlefield, Connecticut, taking home the number
(35:04):
one orchard across the country according to USA Today. And
then you know several other New England orchards rounding out
the top ten on there.
Speaker 2 (35:12):
So good job.
Speaker 3 (35:13):
And quite honestly, Midwest, what are you doing not having
the top number one corn maze in the country, Like
you know, I'm not even really seeing. Kentucky is like
number five, honestly.
Speaker 2 (35:28):
Not a corn maze fan. Too creepy for me, oh
to like, it's I just I it creeps me out.
Speaker 3 (35:38):
Yeah, I'm not with you there, But I can understand
why you would say that.
Speaker 2 (35:42):
It'll be being my height and everything that corn is
awfully intimidating. Yep, yep. So I want to talk a
little bit about Meta's announcement yesterday of these new smart glasses,
they really will. Yeah, when when you can't get the
product to work during your demo, Gosh, it sure seems
really intuitive for us all to be wearing these. So
the best description that I saw yesterday was congrats to
(36:05):
Meta on you know, pushing everyone to use the Apple
eyeglasses three years from now. And this is like the
thread is, hey, even if this becomes a thing, which
you know, Zuckerberg's trying to talk about, Hey, like everyone's
gonna be wearing these because I get it. They want
to control the hardware so they don't get bopped on
the head like Apple did to them a few years ago.
(36:28):
But ultimately, there are a few different problems that Meta has.
The first is, no one wants to buy their hardware
in any form factor. Let's be honest. They've tried a
lot of different things. They've tried glasses before, they've tried
artificial you know, virtual reality stuff. They've tried the home
pod type device, things like that, the in home devices
(36:50):
and things like that. I don't think there's any evidence
that people want to buy Meta hardware. They're just really
hooked on the social media aspect of it. The second
piece is. I think a lot of users, particularly Apple users,
like continuity within the ecosystem, meaning, hey, even if wearable
(37:10):
glasses become a big thing wearable glasses. All glasses are wearable,
aren't they, even if you know were technology. Even if
smart glasses become a thing, the Apple consumer is likely
to opt for the Apple product even if it's not
the best thing out there, because that's what Apple consumers do.
I say this as a proud Apple consumer. I keep
(37:33):
buying new iPhones why because it's already there now. I
stretch them out as long as possible, like five years
or so if I can, But I don't want to
like reinvent myself at this point. So yeah, Zuck's trying
to sell these things. I also don't know how much
of a market there is for smart glasses. At eight
hundred dollars, it's a pretty high price point.
Speaker 3 (37:55):
The only market for any of this type of stuff
is in the gaming industry, and I am just shocked
that we do not have a good gaming VR headset
that people are mass buying and producing right now.
Speaker 2 (38:07):
So it's yeah, I thought this was interesting. Let's take
a quick break for the rest of the day. Back
at it tomorrow that we're gonna finish off the week
on the Financial Exchange
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with Chuck Zadath and Mike Armstrow, Chuck.
Speaker 2 (01:10):
Mike Kentucker with you here. Day after the FED meeting
in which the Federal Reserve cut the short term FED
funds rate by a quarter percent, we've got a broad
rally taking place in equity markets. All three major US
indices are in the green. The Dow Jones Industrial Average
up one hundred and one points about a quarter percent,
SP five hundred about thirty seven points or half a percent,
(01:33):
and the Nasdaq is currently up two hundred and forty
points about one percent. So remind me if you've heard
this story before. Tech is kind of leading the way
for the stock market, and thank you for you know,
your time and attention. It's just it's it's what we're
seeing with this market. It just continues to be a
tech driven market right now today, coming out of the
(01:56):
semiconductor space, which was not in a good spot yesterday
on some negative news for Nvidia. But we've got some
other Invidia related news that we're gonna get to in
just a second once we finished going through markets. Ten
year treasury selling off very modestly, up four point six
basis points to four point one to two percent. We've
got oil today, let's see oil's basically flat, up twelve
(02:19):
cents a barrel on West Texas Intermediate to sixty four seventeen.
And we've got gold today selling off on some renewed
dollar strength. This has gold currently down forty four to
thirty and ounce to thirty six seventy three and fifty cents.
Gold obviously has been on a tear the last few weeks,
so little consolidation not entirely unexpected, and we'll see where
(02:44):
it goes from here. Also one other interesting data point,
Mike on the the weekly jobless claim stuff. Please, so
the initial claims came in back in line with where
you want to see. They dropped from two hundred and
sixty four thousand to two hundred and thirty as we
kind of suspected they would come down because of a
couple reporting anomalies last week. We've got a new reporting
(03:07):
anomaly this week, though, Michael, oh good, it's not on
the initial claim side, it's on the continuing claim side.
And we're gonna hop on the old covered wagon and
travel down to North Carolina. I don't know why you
do that. It's more kind of going out.
Speaker 3 (03:21):
West that's pretty directly south.
Speaker 2 (03:23):
Yeah, well, we can hop on, you know, a nice
little plane and head down to North Carolina. How's that
seem more twenty first century? Thank you? That does seem better.
If we were going to Oregon, we would hop in
the covered wagon. Yeah, correct, Yeah, no, we can't agree there.
So North Carolina last week they reported twenty thousand, five
hundred and thirty five continuing unemployment claims. This week, two hundred.
Speaker 3 (03:47):
And five seems off.
Speaker 2 (03:49):
The lowest they've ever had prior to this was around
twelve thousand, so it's pretty unlikely that they have just
two hundred people on continuing claims. So the continuing claims
data for next week is likely to be revised up
pretty significantly, just because I don't think North Carolinas suddenly
had ninety nine percent of the people on unemployment go
(04:11):
off unemployment. It's never happened before in a single week.
Speaker 3 (04:16):
So does that look at this stuff before that?
Speaker 2 (04:19):
No idea. Do you think someone from the BLS would
just call North Carolina like whoever you know set this
in and be like George, Billy, Billy, did your claims
really decrease by ninety nine percent this week? Oh? No,
they did it? Okay, y, why don't you send us
your new claims then and we'll get this processed. You know,
it just seems to me like maybe there should be
(04:40):
a little communication there. Yeah, but hey, who, I don't
I to say that, maybe you know, you would give
it a critical eye and be like, maybe that didn't happen.
Let's talk about something that did happen though. Uh, Intel
is getting five billion dollars from in Video. I'll quote
here from Bloomberg and Video agreed to invest five billion
in Intel Corporation, and so the two will co develop
(05:02):
chips for PCs and data Center's a surprise move to
help prop up an ailing arts rival that sent Intel
shares soaring.
Speaker 3 (05:09):
What do you think, Chuck, vote of confidence or tagging
along with the US government here? Remember that the US
government just made an investment in Intel, what a month
and a half ago?
Speaker 2 (05:19):
Can it be both? Yeah?
Speaker 3 (05:22):
You know, I don't know that I would represent a
whole bunch of confidence out of this investment, though it seems.
Speaker 2 (05:28):
I don't know.
Speaker 3 (05:29):
It's hard to read into it. I suppose you don't
just throw money away. But if you're looking to get
on the government's good side, I can see why you
might want to do this as in video.
Speaker 2 (05:39):
Well, here's the thing. In video. It's pretty clear to
me that in Video CEO Jensen Wang as a pretty
close relationship with President Trump. Seems like it they've been
in pretty close contact since late spring, and so I
think that there's a pretty close relationship there. It's hard
for me to imagine a that this deal doesn't happen.
(06:00):
That's some communication with the executive branch. But b it's
also clear to me that in Vidio doesn't just throw
five billion dollars around for no reason. You know, they
must think there's something there that they can get as well. Now,
exactly how this is going to take shape is still
an open question because basically what's being outlined here and
(06:23):
Video's gonna buy shares an Intel stock in order to
you know, process the investment, and Intel will then use
in Video's graphics technology and up upcoming PC chips and
also provide its processors for data centers built around in
video hardware. I don't know why that is a market, Like,
is anyone building data centers right now being like, hey,
(06:45):
this would be much better if we bought some Intel
chips to It would seem to me if they thought
that they would already be doing it. They didn't offer
a timeline for when these first parts would go on sale,
and says that the announcement doesn't affect their individual future plans.
So I'll tell you the place that my head did
go to immediately after seeing this. How long do you
(07:08):
think it is until Nvidia buys out Intel entirely?
Speaker 3 (07:16):
I don't, okay, So, I mean it's only one hundred
and forty six billion dollar company now, even with the
giant jump that they've seen, the stock is up by
fifty six percent right now. Yes, I take your point,
But does anyone does in video really want to manufacture chips?
This is exactly how Intel got to where they are
in the first place.
Speaker 2 (07:37):
Here's just hear me out on this. Because my wheels
got turning as soon as I saw this. I'm like, okay,
Like in Video is gonna want the whole thing at
some point. This is like an entry into where they're going.
If in Video were able to make their own chips,
they need a couple things. There's a couple of things
that need to happen. Obviously. The first is they need
(07:59):
someone with know how to make chips. Intel for all
of its flaws and foibles and this, and that they
can make chips, they might not be the best ones
right now, SIPs.
Speaker 3 (08:09):
They can technically do so, but have failed to make
anything that people want to buy for the lays and
grace technology now for the better part of a decade
a while.
Speaker 2 (08:18):
But maybe this partnership starts to get them on track
in terms of just you know, hey, here's what we're
trying to design. Can you help us, you know, with
manufacturing this and that? I don't know. The other piece is,
if there's one major risk that Nvidia has right now,
it's they are dependent on one supplier, Taiwan Semiconductor, who
(08:39):
the stuff that they're buying from them is manufactured entirely
outside of the United States in Taiwan, in an area
that's directly threatened by the Chinese government.
Speaker 3 (08:50):
All true.
Speaker 2 (08:52):
So if one is nervous about China doing two things,
a kind of crack down on anything semiconductor related that's
being purchased from the US, which it seems like they're
starting to, and be the potential for any Chinese military
action towards Taiwan. If you can have facilities in the
(09:13):
United States that can make your chips it's if you're
a five trillion dollar company or a four trillion dollar company.
Speaker 3 (09:21):
Nice to have an insurance policy.
Speaker 2 (09:22):
One hundred billion dollar insurance policy for having some production
capacity out of the US might be worth it.
Speaker 3 (09:29):
All agreed, But I am also no semiconductor manufacturing expert.
Let's see this thing front of it. So are you
a decade before they have that capability?
Speaker 2 (09:40):
More? Like, I genuinely don't know if you start telling
me it's a day less than a decade?
Speaker 3 (09:45):
Yeah, yeah, you.
Speaker 2 (09:47):
Know, like it's it's every day counts. Is I guess
the point that I'm making And I don't know. I
I just think there's some like that, there's something there
in my my opinion, and I just wonder if if
in Nvidia is seeing the same thing. I don't know. Yeah,
(10:08):
I'm just it's probably easier and cheaper to do it
this way than for Nvidia to start from scratch on
their own, I guess, is what I'm getting at.
Speaker 3 (10:16):
Yeah, I'm not sure if that means they need to
own Intel, but we'll see.
Speaker 2 (10:22):
I don't know. This could be one that's like completely
off the board, Tucker, can you put this on the
board for call it? By end? Of twenty seven. Give
me a two year window.
Speaker 4 (10:31):
On this end of twenty seven.
Speaker 2 (10:33):
Yeah, what kind of odds am I getting on that?
Well check predicted. Okay, uh yeah, let's put that on
the board for end of twenty seven. But I don't
know that. Like I saw it, and I'm like, ooh,
this is a first step, like it's it felt that
way to me at least. Yeah.
Speaker 3 (10:51):
I like our way of promoting gambling versus the NFLS
and I don't actually bet any money on it. We
don't actually bet any money on it. And the things
that we bet on only you and I are interested in.
Speaker 2 (11:03):
There's no market for this, Like we'll will in video
bye Intel by the end of twenty seven. Yeah, we've
got one person who's wagering nothing. His name's Chuck.
Speaker 4 (11:12):
Tune in two years.
Speaker 2 (11:13):
Yeah, when we get to the January first, twenty eighth show,
it's gonna be straight fire. Let's take a quick break here.
When we come back, we'll do a little bit of trivia.
Do we want to talk Huawei, Michael, Yeah, we do. Okay,
let's do a little bit of Huawei when we return.
Speaker 1 (11:33):
Find daily interviews and full shows of the Financial Exchange
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This is the Financial Exchange Radio Network. The Financial Exchange
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(11:56):
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Speaker 4 (12:09):
This segment of The Financial Exchange is brought to you
by the US Virgin Islands Department of Tourism. Looking for
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Speaker 2 (12:46):
Time for trivia.
Speaker 4 (12:47):
You're in the Financial Exchange, and today is Lance Armstrong's
fifty fourth birthday. Armstrong gained fame for his performances at
the Tour de France after beating cancer trivia question today,
how many Tour de France titles does Lance Armstrong currently have?
Once again, how many Tour de France titles does Lance
(13:08):
Armstrong currently have? H Be the first person today to
text us at six one seven three six two thirteen
eighty five with the correct answer, and you win a
Financial Exchange showed t shirt. Once again, the first correct
response to text us to the number six one seven
three six to two thirteen eighty five will win that
T shirt. See complete contest rules at Financial exchine show
(13:31):
dot com.
Speaker 3 (13:32):
Tour de France. Yeah, Tour de France.
Speaker 2 (13:36):
Tour de France Listen Armstrong is one of those titles
when I actually watched the thing, you know, I mean,
I like, back then, I thought it was like really cool.
It probably still is, but I gotta admit he was
the only reason that I was watching him back then. Sure,
let's talk a little bit about uh Huawei, so uh
Bloomberg report here, Huawei unveils ai chip roadmap to challenge
(13:57):
in Nvidia's lead. We talked about this little bit yesterday,
so earlier this summer we correctly called it, and we're
proud to toot our own horn on this that, Hey,
the most interesting thing would be the US grants export
licenses to Nvidia to send their chips to China, and
China says we're not interested, which is exactly what they
said yesterday. The thing we then speculated about yesterday is, hey,
(14:21):
what if, you know, China tries to do what they
always try to do, which is, hey, you know what,
let's just make so much of this stuff at such
a cheap cost that we can then sell it everywhere
and put competitors out of business because we can just
do it cheaper than everyone else.
Speaker 3 (14:36):
They've done with solar panels, they're trying to do it
with cars, and this sure is a pretty good roadmap.
Speaker 2 (14:41):
For it, and this year seems like they're trying to
do it now. These are going to be models that
are rolled out in twenty twenty eight, and I'm sorry's
twenty seven and twenty eight, so there's you know, a
year and a half to two years before these are
coming out. But the question that I posed yesterday that
i'll continue to pose today is Okay, you have a
pretty convincing case for me at least that domestically Microsoft
(15:04):
and open AI and Meta and Google probably not going
to be interested in these chips. Is that a fair assessment, Mic?
I think so. In Europe, I think it's going to
be more of a question. But Europe is successfully fended
off Huawei inside of telecom systems previously, and so I
think that they could do so here, even though their
(15:26):
track record is bad at best. Just look at you know,
Chinese evs overrunning European manufacturers right now. Right The one
that really interests me is what happens with the you know,
the Gulf States and and and basically any OPEC country
that has committed to buy a lot of Nvidia chips
right now, because it's pretty clear to me that the
(15:49):
trade that you know, these countries see if you're you know,
the UAE, just as an example, you say, okay, we'll
buy you know, all this stuff instead up a big
data center here and we can run it in. That'll
be great in and of itself, but obviously they also
want you know, defense contracts and things like that. They
want US weapons clearly, like we've seen how the deals
(16:10):
have unfolded so the question for me is if China
were to go to the UAE and you know who,
like whoever they want to go to and say, hey, look,
I know you're supposed to buy you know, X billion
dollars of in Nvidia chips. We'll give you the same
performance at twenty percent of the cost, and we'll buy
(16:32):
even more oil from you, because the US can't commit
to buying more oil right now, Like the US is
like we're you know, we're not buying more. We're not
the future customer for the Gulf States. And so I
think that's the interesting thing that I think I'll watch
over the next year or so, is hey, what do
(16:52):
we see in terms of potential chip commitments from those
countries saying yeah, we're okay doing that and being China's
ecosystem on this stuff. I'm just curious to see if
it plays out that way, because this is not a
case where here's the thing, like China can't go to
a lot of other countries. There aren't many countries that
actually have enough money to buy these and like sizeable
(17:15):
quantities like you can't go to It's not gonna be
like the Belton Road initiative. China can't go to Cameroon
and be like, hey, do you want to buy billions
of dollars of our chips, because Cameroon's gonna be like,
what do we use these for? Here? Yeah, it's like
we're not gonna be a big data center hub. Like,
it's just not what we're set up to do.
Speaker 3 (17:32):
Europe Middle East. So the question then about these I
think clearly China probably has the capability to manufacture a
ton of them. The questions aren't they any good?
Speaker 2 (17:46):
Right?
Speaker 3 (17:47):
Because like the entire theory that we've been running on
here Chuck is, yeah, maybe they will just produce chips
that aren't that good. But because they have such incredible
power generation capability in China, then it won't matter because
they can they can just build more and more of them,
and they'll be able to get around the fact that
they're not terribly efficient. That's not the case in Germany,
(18:07):
it's not the case in Spain. If you want to
start up a data center in Spain and run your
AI models on Chinese chips, good luck finding the power,
good luck finding electricity for it. And so that's the
question is are they good enough to sell to customers
outside of China, where yeah, you can just you know,
wipe out an entire city and put up a nuclear
power plant, because who's going to question you?
Speaker 2 (18:29):
Piece from Bloomberg, opinion from the full editorial board. Congress
has no good excuse to keep trading.
Speaker 3 (18:35):
Stocks, nor have they for the last thirty years, but
hasn't stopped them. No, they once again make a compelling
argument that congress people senators should not be able to
trade stocks, and once again it'll be completely ignored and
they will continue to insider trade without having to call
it insider trading.
Speaker 2 (18:54):
Yeah, it's this should be one of the simplest things
to do. But obviously Congress is kind of failing to
self police on the issue. And that's why you have
two different exchange traded funds that are now tracking the
trades of Nancy Pelosi and Ted Cruz. Yeah, so.
Speaker 3 (19:14):
I guess we'll just continue to tolerate this. We shouldn't.
Everyone should be upset about this, because both Democrats and
Republicans do it over and over again.
Speaker 2 (19:25):
Disgusting. Let's take a quick break here. Stocks remain broadly
positive as we head towards the bottom of the hour.
We got the trivia answer and Wall Street.
Speaker 1 (19:33):
Watch next, bringing the latest financial news straight.
Speaker 2 (19:41):
To your radio.
Speaker 1 (19:42):
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 (19:57):
Markets in rally mode after the FED reduced interest rates
by a quarter of a percent at the conclusion of
their meeting yesterday afternoon. AI and Chip gin Nvidia also
remains in the spotlight with more news around them at
the moment. The Dow is up three tenths of one percent,
or one hundred and fifty four points higher, SMP five
hundred is up seven tenths of one percent or forty
(20:20):
six points, Nasdaq up one point two percent or two
hundred and sixty five points, Russell two thousand up nearly
one and a half percent, Tenure Treas reeled up three
basis points and is now at four point one point
one four percent, and crude oil down seven tens of
one percent, rating its sixty three dollars and sixty one cents.
(20:41):
A barrel of the big tech news on the day
revolves around in Vidia and Intel after in Video said
it would invest five billion dollars in struggling chip maker
Intel to co develop data center and PC products. After
shedding three percent yesterday in video, stock is rebounding three
percent today, while Intel shares are surging twenty eight percent. Meanwhile,
(21:04):
some breaking news this hour we where the FTC and
seven States sued Live Nation and Ticketmaster for failing to
enforce its own purchase limits, which allowed resellers to buy
up large numbers of passes for popular events. Live Nation
shares are down by two percent on that news. Elsewhere
(21:24):
shares and Nova nor Disk jumping six percent after the
drug maker said late stage trial of its once daily
obesity pill showed significant weight reduction in line with its
we Go Vi injectable weight loss drug. PayPal and Alphabet
announced it with team up on online shopping, laying out
plans to combine PayPal's payment infrastructure with the Google's AI expertise.
(21:50):
Both PayPal and Alphabet are up about one percent. Darden
down by seven excuse me, nine percent after the olive
garden owner raised its annual outlook but hosted adjusting earnings
below forecasts. And after today's closing bell, we'll see earnings
from FedEx and Lenar. I'm Tucker Silva and that is
Wall Street Watch. And in the previous segment, we asked
(22:13):
you the trivia question, how many Tour de France titles
does Lance Armstrong currently have? That would be zero, yeah.
Speaker 2 (22:23):
Zero.
Speaker 4 (22:23):
While Armstrong did win seven Tour de France races, he
was stripped of all his titles due to the use
of performance enhancing drugs. Edward from Bill Recer Mass is
our winner today, taking home a Financial Exchange Show t shirt.
Congrats to ed and we play trivia every day here
in the Financial Exchange See complete contest rules at Financial
(22:44):
Exchange Show dot com.
Speaker 3 (22:45):
I feel like our trivia is slowly switching to riddles.
I think it's Tour de France.
Speaker 2 (22:51):
Shut up.
Speaker 3 (22:55):
From Tucker on this one.
Speaker 2 (22:57):
Fantastic, Mike. Do you want to talk about what other
gen zers should include social Security in their retirement planning
or how to start practicing retirement?
Speaker 3 (23:07):
I like the idea of practicing retirement. Can I practice retirement?
Speaker 2 (23:10):
Yeah? Why don't you just go right now?
Speaker 3 (23:11):
Yeah, I'll talk to you guys later. So realistically, no,
really realistically for a moment here, Chuck, have you, I'm
sure you have. I do frequently see people retire and
then just utterly fail at that retirement. It's usually not
because of their overall planning or lack thereof, but I
(23:34):
think people just have this oftentimes wrong view of what
retirement's going to be, Like, how do you see it?
Most often when I see people screw it up? Like,
let me be clear, like eight times out of ten,
I think people do it really well. They you know,
find a lot of enjoyment and retirement. They are doing
(23:56):
things that they didn't have time to do, They're restarting
passions that had previously. But when I see people screwed up,
it's usually because they end a job, either involuntarily or
because they just hated the job, and then they have
no idea what to do with themselves.
Speaker 2 (24:15):
Yeah. Yeah, it's a lot of times, I would say
amost all the time when people talk about planning for retirement,
they're so focused on can I that they don't really
focus on, well, how do I actually do it? And
should I? Yes? And so what does this get at
in terms of the idea of practicing retire Like what
(24:36):
do we mean by practice retirements?
Speaker 3 (24:38):
Well, the case that they lay out, which is a
compelling one, but most employers won't let you do it,
is try and kind of slowly practice your retirement activities
before you get there. Like most of us that are
heading towards retirement don't have young kids at home anymore,
and so hey, I really want to get into I'm
(24:58):
gonna go with the most unique one. I No client
of mine really want to retire and spend more of
his time building bird houses. Love it awesome activity? Uh,
try it out.
Speaker 2 (25:09):
Have you watched Listers? By the way, do.
Speaker 3 (25:11):
It for five hours on a weekend and see if
you actually enjoy it would be the answer. No, I
haven't watched Listers. What's Listers?
Speaker 2 (25:17):
It's a like two hour documentary on these guys who
decided to go on an extreme bird watching tour for
a year. Extreme like doing like nutty things to go
watch birds. Okay, I know you'd be like extreme bird watching.
What's that? If you watch it, you'll get it. And
then they wrote a book basically about all the birds
that they saw, but it's it's a bird watching book
(25:38):
for late people got it so that the reviews that
you see on Amazon are like, not the book I
would pick in order to find birds, but entertaining nonetheless.
Speaker 3 (25:47):
So the you know, awesome result, the result that I've
seen people really get the best out of is when
an employer actually allows you to cut back your hours,
right like, hey, yeah, I'm going to three week and
I'm phasing into retirement.
Speaker 2 (26:02):
Now.
Speaker 3 (26:03):
Again, that's a pretty unique situation. I will fully admit
that most employers aren't terribly okay with it. But like,
you know, if you can drive a compelling argument, hey
I'm going to drop my health insurance and you can
cut my wages, but I want to try out this
retirement thing and go to three days a week, Like
what a perfect solution for figuring out what it is
that you're going to do. So that's the idea of
(26:23):
practicing retirement. And if it doesn't really work in that
specific way, then there's other ways to do it, such
as dedicating you know, I guess the most important thing
is actually having a reason to get up in the
morning and do retirement every day, right, Like, what is
it that I'm going to fill my time with? But
(26:44):
in look to have the luxury of practicing that, to
have the luxury of knowing that, hey, I can step
out and drop my health insurance and move back to
a few days a week, you do have to start
with the financial side of planning for retirement as well,
and if you would like to learn a little bit
more about how Armstrong Advisory Group thinks about those stages
(27:06):
of planning for retirement, we'd encourage you to come to
one of our live seminars happening next month. I've talked
to you a little bit about these before, but it's
gonna be a combination of both a live broadcast of
this show, the Financial Exchange, followed by meet and greet
and seminar with the Armstrong Advisor Group. We're gonna buy
you lunch and meet you at either the Showcase Super
(27:27):
Lucks and Chestnut Hill on October sixteenth or the Margaritaville
Resort on Cape Cod on October ninth, so two separate
events that you can sign up for. Space is always
limited for these folks and we do sell out, so
we need you to call and book your appointment before
you show up. Once again, the first one live broadcast
of The Financial Exchange, followed by lunch with aag October
(27:51):
ninth on the Margaritaville Resort on Cape Cod and then
follow by that we're gonna be doing the Showcase Super
Lucks Chestnut Hill on October sixteenth and sign up at
Armstrong Advisory dot com or by just calling us at
eight hundred three nine three four zero zero one. It's
a really good time. You get to see the actual show,
meet that guy Tucker. Will you be there in person
(28:13):
or do you have to stay here to be determined?
To be determined whether or not you get to meet
Tucker at these events, but we would love to have you.
It's always a really fun time and I think a
lot of people get a lot out of it. So
join us. October ninth, October sixteenth, Armstrong Advisory dot com.
Speaker 1 (28:27):
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 make contact you to offer investment
advisory services.
Speaker 2 (28:43):
Mike, we got to talk about this home insurance piece. Yeah,
it's title, and this is something we've been harping on
for the last year, and again I still don't think
people are quite prepared for this. And the title says
that home insurance, as you know it is doomed, you're
not ready and I know that that, Mike. How often
do we are we like, you know, doomers on the
show where we're like, the world's gonna end, everything's gonna
(29:05):
be bad.
Speaker 3 (29:05):
Like, no, we don't say that, but we criticize the
articles that do say it.
Speaker 2 (29:10):
This one's underplaying it in my opinion.
Speaker 3 (29:12):
When you have the CEO of the largest reinsurer out there,
reinsurance companies are insurance companies that ensure insurance companies coming
out and saying we are starting to reach the limits
of traditional insurance.
Speaker 2 (29:28):
Yes, that's like, that's a shot across the bow. Correct.
So just as like the data that we have here,
home insurance costs in the United States have risen twenty
percent in the past two years. They're set for another
eight percent gain nationally this year. And when you look
at it, the states that have high home insurance rates,
(29:48):
they are the exact ones that you'd expect Florida, Louisiana, Oklahoma, Colorado, Texas.
They're ones with lots of natural disasters because that's usually
what causes the most widespread damage. It's you know home
you know, fires and things like that. Sure that happens,
but it's kind of predictable. You know, there's a fairly
fixed rate of those across the country. You don't have
hurricanes in Vermont, same way that you don't have you know,
(30:12):
earthquakes in North Carolina that cause you know, any meaningful
widespread damage, So you can kind of predict where the
damage is going to be. So Louisiana as an example,
right now, this year, the average home insurance costs there
is eleven thousand dollars a year. That's expected to rise
by another three thousand this year. So you're talking a
(30:32):
twenty five percent premium bump for Louisiana this year. And
as someone who spent last weekend in Louisiana, I can
tell you it's a really low and flat state and
I understand exactly why this is happening.
Speaker 3 (30:46):
It's also a relatively poor state where people are not
going to be able to ensure these things.
Speaker 2 (30:50):
And this is the problem is what this is going
to mean is that even in a world in which
interest rates may come down, insurance costs, property taxes, and
utilities are going to be a major headwind against the
housing market for the foreseeable future.
Speaker 3 (31:09):
Here's my biggest problem with this overall situation is we
are not doing anything at the state or federal level
to address this head on, and so what everyone should
be listening to and what can you do? I well,
I worry about what will be done, which seems to
be really like, here's how I see this playing out,
(31:31):
Chuck is, more and more insurance companies try to raise prices,
more and more states prevent them from doing so. More
and more states go and set up the Florida and
California model, which is, if your insurance company drops you,
the state will ensure you again. And where I think
we will ultimately lead to is someday one of those
(31:52):
companies will go belly up, and then we at the
federal level, we you know, all taxpayers will have to decide, Okay,
are we bailing out state insurance? Is that made bad decisions?
Speaker 2 (32:01):
Yep?
Speaker 3 (32:02):
That's like I don't have an answer for how you
deal with this at the insurance company level other than
raising premiums.
Speaker 2 (32:08):
I don't think you can stop that.
Speaker 3 (32:10):
What I worry about is that we in Massachusetts, we
in Vermont, in Maine, you know, across the country are
gonna be left hold in the bag for when Florida's
state insure finally goes belly up based on a huge
hurricane sure and that's that's how it involves all of us.
Speaker 2 (32:24):
Yeah, the FARTA insurance market does appear to be stabilized somewhat. Yeah,
and that does.
Speaker 3 (32:29):
Insurances are coming back. They finally got rid of some
of the fraud. They've allowed premium increases. You have people
dropping off the state run insurance. So I'm seeing signs
of encouragement.
Speaker 2 (32:39):
But it's stabilizing at an average cost of like fifteen
fifteen five hundred a year, which is up from you know,
seven thousand a year a few years back. Yeah, so
that like this is unfortunately the stuff that you need
to do in order to stabilize these things is the
insurance costs likely have to go up. I mean Louisiana
just as an example, the average cost of a home
(33:02):
in Louisiana, not that different from the broader US, is
about five hundred thousand for homes that were sold this year.
If you're paying fourteen thousand for insurance, you're talking about
almost three percent of the homes cost in any given
year is going to the insurance policy. And that has
an impact because hey, one thousand dollars a month being
(33:23):
added to your monthly mortgage payment. It's probably increasing your
monthly payment by fifty percent. It's a huge thing that
you got to account for, and it's going to happen
in more and more states because this is this is
a widespread issue that is going to continue to grow.
Quick break here when we come back Stack Roulette.
Speaker 1 (33:41):
The Financial Exchange Show podcast drops every day on Apple, Spotify,
and iHeartRadio. Hit that subscribe button then leave us a
five star review. You're listening to the Financial Exchange Radio Network.
Here The Financial Exchange every day from eleven to noon,
Non Serious XM's Business Radio Channel one. Keep it here
(34:01):
for the latest business and financial news and the trends
on Wall Street. The Financial Exchange is now live on
Series XM's Business Radio Channel one thirty two. Thanks, he's
the Financial Exchange Radio Network, Mike.
Speaker 2 (34:19):
What do you got for me? For stock Ruler, Chuck?
Speaker 3 (34:21):
It is h apple picking season and New England has
taken home some accolades for the best orchards and corn
mazes out there. In fact, according to USA Today, they
went and ranked for me the top ten apple orchards
in the country, along with the top ten corn mazes,
which I love a little bit of each of those
this time of year. Number one corn maze up in Maine,
(34:44):
Levant Levint, Maine, Levant, Maine. I don't know how you
pronounce it. Tree Wargi Family Orchards taken home the number
one spot there. The corn maze covers over four acres. Oh,
it's a whale. Yeah it's a whale. And then Baby
Wheel Lineman Orchards in Middlefield, Connecticut, taking home the number
(35:04):
one orchard across the country according to USA Today. And
then you know several other New England orchards rounding out
the top ten on there.
Speaker 2 (35:12):
So good job.
Speaker 3 (35:13):
And quite honestly, Midwest, what are you doing not having
the top number one corn maze in the country, Like
you know, I'm not even really seeing. Kentucky is like
number five, honestly.
Speaker 2 (35:28):
Not a corn maze fan. Too creepy for me, oh
to like, it's I just I it creeps me out.
Speaker 3 (35:38):
Yeah, I'm not with you there, But I can understand
why you would say that.
Speaker 2 (35:42):
It'll be being my height and everything that corn is
awfully intimidating. Yep, yep. So I want to talk a
little bit about Meta's announcement yesterday of these new smart glasses,
they really will. Yeah, when when you can't get the
product to work during your demo, Gosh, it sure seems
really intuitive for us all to be wearing these. So
the best description that I saw yesterday was congrats to
(36:05):
Meta on you know, pushing everyone to use the Apple
eyeglasses three years from now. And this is like the
thread is, hey, even if this becomes a thing, which
you know, Zuckerberg's trying to talk about, Hey, like everyone's
gonna be wearing these because I get it. They want
to control the hardware so they don't get bopped on
the head like Apple did to them a few years ago.
(36:28):
But ultimately, there are a few different problems that Meta has.
The first is, no one wants to buy their hardware
in any form factor. Let's be honest. They've tried a
lot of different things. They've tried glasses before, they've tried
artificial you know, virtual reality stuff. They've tried the home
pod type device, things like that, the in home devices
(36:50):
and things like that. I don't think there's any evidence
that people want to buy Meta hardware. They're just really
hooked on the social media aspect of it. The second
piece is. I think a lot of users, particularly Apple users,
like continuity within the ecosystem, meaning, hey, even if wearable
(37:10):
glasses become a big thing wearable glasses. All glasses are wearable,
aren't they, even if you know were technology. Even if
smart glasses become a thing, the Apple consumer is likely
to opt for the Apple product even if it's not
the best thing out there, because that's what Apple consumers do.
I say this as a proud Apple consumer. I keep
(37:33):
buying new iPhones why because it's already there now. I
stretch them out as long as possible, like five years
or so if I can, But I don't want to
like reinvent myself at this point. So yeah, Zuck's trying
to sell these things. I also don't know how much
of a market there is for smart glasses. At eight
hundred dollars, it's a pretty high price point.
Speaker 3 (37:55):
The only market for any of this type of stuff
is in the gaming industry, and I am just shocked
that we do not have a good gaming VR headset
that people are mass buying and producing right now.
Speaker 2 (38:07):
So it's yeah, I thought this was interesting. Let's take
a quick break for the rest of the day. Back
at it tomorrow that we're gonna finish off the week
on the Financial Exchange
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